Big Data: The Conversational Game-Changer

Oct 01, 2012 11:32 PM  By

No matter where you go in the marketing world, you can’t escape the words “big data.” Some marketing insiders are predicting that it will be a sure-fire way to increase profits, while others believe it will provide that much sought after 360-degree view of a customer.

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Right now, only the largest or most data-friendly companies seem to be involved in serious planning for or the implementation stages of big data. But most retailers agree that the promise of big data will be worth the chase, and that big data will make it easier to communicate with their customers in their preferred channels of communication.

For Rod Ford, senior vice president and general manager, specialty retail, Merkle Inc., big data is the “holy grail” because it is revealing so many previous unknowns. With big data technology, marketers now have the tools to identify every visitor to an ecommerce site, as well as the ability to see exactly which mouse click got them there.

This new tactic is also allowing marketers to deploy their messages in a much more personalized manner.

Glenda Lehman Ervin, vice president of marketing at Lehman’s, a family-owned retail store that specializes in old-fashioned, non-electric merchandise, says her company will begin using big data next year in order to create much more personalized relationships with customers.

“How can we compete against the Amazon’s and the Walmart’s? The way we can do that is by creating a connection with our clients,” Ervin says. “We will be able to contact people where they want, when they want.”

Because of Lehman’s diverse clientele, which includes missionaries working in developing countries, homesteaders, environmentalists, second-home owners and hunters, the challenge is to reach out to all these people in ways that create intimacy and meaning.

Breaking Down the Silos, and Tag Assessment

There are three foundational components that any marketer must address when getting involved with big data. The first thing a company must do when creating a best practices plan using big data is to remove the roadblocks and silos within the company and to make sure everyone is on the same page.
Mabelle Artz, senior manager, digital marketing, Hewlett-Packard, said in a recent Forrester Research case study, HP Deploys a DMP to Harness Audience Data, that HP realized that many company sectors were making individualized decisions about tag management. That had created inconsistent tagging throughout the company, resulting in an “incomplete picture of holistic user behavior.”

BlueKai, according to the Forrester report, helped Hewlett-Packard create “universal tag management (including security and privacy controls), holistic data collection and normalization, segmentation capabilities, and the ability to plug into key digital channels such as display … ” and that all “would allow for improvements in insight and targeting.”

Once the internal silos are broken down and your site is appropriately tagged, the company will have a much more fluid approach to how big data should be used for marketing purposes.

Get Yourself a Data Management Platform

The second component is that companies need the technology to recognize and manage the data that is collected offline and online.

The best way to do this, according to Bruce Biegel, managing director of the Winterberry Group, who spoke in July at a Merit Direct Co-Op, “lies in a data management platform where data sets can be managed and prepared for marketing deployment.”

In other words, a data management platform takes all the data that you have captured about customers and prospective customers and feeds it into an engine that can help simplify marketing execution and deployment. Users of a data management platform, by creating data segments, can improve advertising effectiveness, enhance relevance and improve audience targeting.

What does Lehman’s hope to get out of big data? “The one word answer,” says Ervin, “would be segmentation. We want to contact people when they want, where they want. And in order to do that, [the data] has to be automated to sort out what makes sense and what doesn’t.”

Ervin adds that Lehman’s is expected to launch its new big data initiative in March 2013, once it gets a full software integration with Dynamics AX. The software, she says, will be able to house all of its data in one place, allowing for the segmentation of customers by what they purchase, the geographic location, and how they can be directed to the store or to the site. This will help the marketing team deploy messages geared toward their shopping habits, whether it’s pushing them to the site, the catalog or to the Ohio store.

Create Personalized Marketing Pieces

The second foundational component coincides with what Biegel said about marketing execution. Merkle Inc.’s Ford calls this the “conversational marketing” technology that allows marketers “to load these attributes into an engine to allow these conversations to take place.”

These conversations can take any shape you, or your shoppers, want. It can be through emails, an SMS message, a Facebook posting, a tweet or a catalog—the possibilities are endless. “All I am really trying to do is push [the customer] down this customer journey that will bring him closer and closer to my brand,” Ford says.

Adult novelty retailer Adam and Eve knows all too well the importance of creating a personalized marketing piece, given the highly private products it sells. Glenn Mersereau, Internet marketing director and head of ecommerce at Adam and Eve, says, “Our market consists of a lot of different types of people who are looking for a lot of different things, and our standpoint is to look into how big data integration can help us make smarter marketing decisions.”

Although Adam and Eve is in the very early stages of moving toward big data, Mersereau says that being able to create a tailored message should ultimately “increase the lifetime reactivation and rebuy rates for the customers we do not know about.”

And, he adds, “The key thing I think a lot of companies need to think about is that there is a lot of hype around big data … you don’t just flip a switch. It does take time to plan this out, to plan out expectations. You’re not going to conquer the world overnight.”

Big Data Means Big Investments

Many believe that simply incorporating big data into your marketing plan will increase your profits, but that is possible only if the incorporation is done correctly. When deciding to move into the big data space, companies must understand that quite a lot of time and money will be required to see it through, says Arthur Sweetser, chief marketing officer, 89 Degrees.

Not only will big data call for additional resources from employees, but the software alone could cost anywhere from “$250,000 to seven-figures,” depending on the company’s need, Sweetser estimates.

“The first thing that someone must know is that this is not an insignificant investment,” says Sweetser. “You need the talent, the technology and the practice to make this work.”

Jim Wheaton, co-founder and principal of the Wheaton Group and of B2BMarketing.com, said in an email that integration of big data will improve sales, just as any data integration project has in the past: “If you fail…you should refocus your efforts on your resume because the project is likely to be a flop,” Wheaton wrote.