We live in an age were “data is king”. A term which is bandied around many a boardroom and although it has become overused it still encapsulates exactly the role that data plays in business today. So how does the concept of big data fit into this landscape? And how should marketers be using big data to drive their marketing activity?
The definition of big data varies depending on your point of reference. The mass media tend to generalise the term to mean simply ‘data analytics’ with inferences of Orwellian infringements on our privacy. The Wikipedia entry stipulates that big data is “an all-encompassing term for any collection of data sets so large and complex that it becomes difficult to process using on-hand data management tools or traditional data processing applications”. But big data is so much more than a whole lot of data so large in volume that it becomes tricky to manage.
An SBS documentary which aired in January this year, called “The Age of Big Data” explored the impact that big data is having on business, the consumer and our everyday lives. The documentary looked into “predictive policing”, one example of how big data is revolutionising the way police departments operate. Predictive policing, as the name suggests, predicts criminal activity before it happens. An algorithm which draws on years or even decades of crime reports, predicts where and when specific types of crimes will strike next. This information is communicated to police patrol cars to ensure that they’re in the right place at the right time, preventing crimes before they even happen.
So how does this relate to marketing? It means that similar algorithms can be used to predict customer behaviour. The idea of knowing how your customers will behave even before they do is a compelling one. Haven’t marketers been working towards such a level of understanding of our customers for decades? And surely you can’t demonstrate better understanding than to know what they’ll do before they do it? Well, not necessarily. In many instances big data is overkill and not providing marketers will meaningful customer insights. Big data may be used to predict when a customer will buy their next product but it’s less likely big data will reveal why the customer is making a purchase. In other words, big data doesn’t allow marketers to “walk in their customers shoes” and understand the motivation behind their actions. Instead, it provides marketers with the data on where they’ll (likely) walk to and when. Suddenly, big data doesn’t seem quite the marketer’s utopia it’s often purported to be.
That’s where small data comes in. In its most simplistic form small data is your customer’s individual data. Whereas big data is the culmination of all your customers’ data into one big ‘engine’ that spits out insights. But the insights that are truly valuable to marketers are at an individual customer level. For example, data from, our customer’s “digital footprint’. Small data provides marketers with insights into how consumers are living their lives, how they’re engaging with brands and what products and services they are interested in or buying. Trusty Wikipedia sums this up by saying “The term “big data” is about machines and “small data” is about people.”
And so as the initial hype of big data dies down, it’s small data that’s emerging as mainstream because small data provides the real customer insights that marketers need. Being in the business of data, it’s my belief that gathering and cultivating this small data (within the constraints of the Australian Privacy Principles) should be every marketer’s priority.
That’s not to say that big data and small data can’t work together for the most intelligent insights. But we’ll leave that one for another blog…
