What Executives Need to Know About Big Data
For the last three to five years, “Big Data” has been spoken about at such length, there is no doubt that the mention of it now results in a few eye-rolls. Big Data is the “hottest new trend,” the “next big thing” – you’ve heard it all before.
Today, we ask you, “Have you actually used Big Data to effectively make sense of your business and industry?” We at Meltwater dare to breathe new life into the overused, but still-important buzzword. With the increasing developments in Artificial Intelligence and Machine Learning, the true value of Big Data is only beginning to be realised.
It’s no surprise that the huge volume of information available at our fingertips is a challenge to control, and most executives can acknowledge its importance. The analysis of the data is becoming more and more important in order to differentiate between the relevant and the redundant data.
Where Did You Come From, Where Did You Go
Examining some highlights in the history of data usage and collection shows us two important things. The first is that it did not come out of nowhere; as the storage of data evolved and the amount of accessible information increased, so the term “Big Data” was coined.
The second thing we learn is that this cycle is always re-inventing itself. In the 24th century BC, when the first abacus was invented, it was revolutionary and disruptive in the same way that generating, storing and analysing Big Data is today. In fact, the above graph is misleading – it implies that 2017 is the end of the evolution of data.
So, what makes Big Data so important and, to some, intimidating? And what, as an executive, do you need to know about it? Here, we break down the buzzword.
1. How Big Data Relates to Your Business
Often, we rush to find the definitions of terms without understanding their implications and how they relates to us. To start the conversation, here are two definitions we like, each with different emphases:
- Big data is a collection of data from traditional and digital sources inside and outside your company that represents a source for ongoing discovery and analysis.
- Big data is an evolving term that describes any voluminous amount of structured, semi-structured and unstructured data that has the potential to be mined for information.
But aside from any one definition, what is most important to understand about Big Data is the impact it can have. The promise of Big Data is that it enables businesses to reveal meaningful, but previously unknown, connections in human behaviour and identity. These insights can have massive implications for understanding your consumer and market but are often challenging to identify or arrive at. This leads us to the second most important aspect you need to know: How Big Data is Analysed By Your Business.
2. How Big Data is Analysed By Your Business
How these volumes of information are analysed is crucial.
Big Data can provide insights to executives that allow them to understand why, for instance, you lose clients from a specific region over a certain season, or why people of a certain demographic are going crazy for a specific product.
An example from one company leveraging the full power of Big Data to gain a competitive advantage is Netflix. A completely data-driven company; nothing they do is “because viewers might like it” or even because the plot is given the green light. In fact, almost every decision they make is based solely on what the analysed data illustrates. For example, House of Cards, their debut project as a production company, saw Netflix draw on Big Data to inform the very colour coordination of the series cover imagery.
From December of 2015 to December 2016, Netflix’s data-driven marketing strategy saw subscribers jump from 75 to 94 million. Much like many online businesses, the world’s leading internet television network has an advantage over traditional television counterparts because of their access to precise viewer behaviors on-demand. Netflix knows for each show, at the most basic level, what the “drop-off” rate was, how many viewers watched the entire series, where they stopped watching or how quickly they finished it.
When the Data showed that the less users watch, the more likely they are to cancel, Netflix introduced post-play (which automatically plays the following episode unless viewers opt out) and personalisation algorithms that accurately predict what users will want to watch next – 75% of activity on Netflix is based on these recommendations.
However, with 16,3 Zettabytes (trillion gigabytes) of data being produced online every year, how do you find the needle that’s relevant to you in such an enormous haystack?
3. How to Analyse Only the Most Important Data
The reality of the situation is that most businesses simply don’t have the human resources to effectively make sense of Big Data in the time-frame society demands.
Manually sorting through the overwhelming amount of data that is available to organisations could take months. The volume, velocity, variety and value of data is growing exponentially, and to illustrate just how much of it is being processed, we looked at the amount of online search queries made daily. On Google alone, 40 000 search queries are processed every second, translating to 3,5 billion searches per day (visualise these incredible numbers here). In five years’ time, that statistic may be laughed at, but today it’s quite remarkable.
The challenge for businesses is therefore not deciding on whether to do Big Data, but trying to possibly make sense of it all once they have. With Meltwater Executive Alerts‘ cutting edge machine learning however, you’re only informed about the most critical insights about you, your competitors, and your industry, across a variety of different data points – so you are always the first to know.
So, the question isn’t whether Big Data is here to stay. The question is, Are you ready?