Loyalty 3.0: Big Data

Does Big Data scare you?

I think some would say, “yes” and others would ask “what are you talking about?”

So, for those who would ask what I am talking about, I will explain it in the best way that I know after reading Paharia’s book.

Big Data has a three-part definition. It is a large amount of data. It is collected passively from digital interactions. It is collected with great variety at a high velocity.

Before there was Big Data, there was Traditional Data. This is the title for what we call ‘asking for your name/phone number/email/address/simple interests.’ This is something that is very common for businesses to ask of consumers and information that consumers willingly hand over sometimes just to get a deal.

The difference between this kind of data and Big Data is that Big Data happens without us really knowing about it happening. We willingly tell store representatives/cashiers our phone number or email to get receipts or coupons, but most average people do not notice the data collection of their IP Addresses, Clickstreams, GPS Locations, etc.

Big Data is easily defined by the 3 V’s. These V’s are Volume, Variety, and Velocity. There is a large volume of data being collected. This data is saved in kilobytes and terabytes. The data is collected in real-time, and this data is a wide variety of structured and unstructured data.

Structured and unstructured data is something that also makes Big Data different. Structured data is basically data that makes sense. It is collected and can be used and organized easily. It is the kind of data that you can put into rows and columns and accounts for roughly 20% of data collected today. On the other hand, unstructured data is data that is not easily organized, cannot be contained into rows and columns, and is actually roughly 80% of the data that is collected. It is, for example, images, audio, video, files, emails, and spreadsheets.

In an article by Niebel (2019), he said that this “data which has become available to firms is often not collected intentionally, but in a heterogeneous and unstructured way. The ability to analyze such data, extract insights and appropriate value from it represents a key challenge to firms”(para.1). This large amount of unstructured data is sometimes so much that it is hard to analyze and control. These sorts of data require a large sum of storage to keep.

But where is all of this storage contained, you may ask?

Big data is not really streamlined to one source. Paharia mentions that it is unlikely to be in one place or owned by one person. And it is growing, seemingly doubling in data every 1.2 years.

This data is useful though. At least for companies. It allows companies to answer the questions of: “what you do, where you do it, when you do it, and what you like”(Paharia). It is beneficial to companies because it gives better customer insight, improves operations, gives more insightful market intelligence, gives agile supply chain management, brings data-driven innovation, and shows smarter recommendations and targeting.

So Big Data collects a lot of information, all the time. It also gives this information to a lot of companies. But is it successful at its job?

Yes, so it seems. The Big Data industry is predicted to reach a value of $103 Billion by 2027. 97% of companies are now saying that they are or are planning to start investing in AI and Big Data. So businesses seem to think this is the real deal, and it is when it comes to successfully knowing this about your customers. I think that it is an interesting concept because it is definitely good for business. It makes targeting your audience way more direct. But, it is ethical?

I think that sometimes when looking at Big Data, it is important to keep your eyes on the big picture. I think it important to have multiple experiences on every issue, but this one in particular. Yes, Big Data is helpful to a marketer, like me, because it gives direct access to information regarding potential clientele for my business. I can connect more personally and relevantly, at a lower cost to me. Ans I can hopefully, and most likely, increase sales for my business. But, does this mean that I am manipulating my consumers by stealing their information for my company’s personal gain? Is this ethical? Should we as consumers be scared of Big Data?

I think Big Data is big and confusing, but I also appreciate the convenience it gives me. It knows what I want to buy, and what I’m interested in, and it lets me know where to buy things, sometimes with the best deal.

But, has it gone too far? Are you scared?

Paharia, R. (2013). Loyalty 3.0 How Big Data and Gamification are Revolutionizing Customer and Employee Engagement. McGraw Hill Education

Niebel, T., Rasel, F. & Viete, S. (2019). BIG data — BIG gains? Understanding the link between big data analytics and innovation. Economics of Innovation and New Technology