The Next Era: The Computer Age
By Charles W. Stryker
The foundation of the Big Data ecosphere was built from the mid nineteenth century on the backs of innovative, first to market industry leaders like D&B, Reuters and AP. These early Founding Fathers of Big Data leveraged technological advancements to achieve short-term business goals. They likely had no idea that their first-to-market strategies of 150 years ago would ensure their company’s leading competitive position today.
Forbes has pointed to the November 1967 paper by B. A. Marron and P. A. D. de Maine as the starting point for tracking the development of the modern Big Data world. In an article entitled, “Automatic Data Compression”, the authors state that ”The ‘information explosion’ noted in recent years makes it essential that storage requirements for all information be kept to a minimum.” The paper goes on to describe “a fully automatic and rapid three-part compressor which can be used with ‘any’ body of information to greatly reduce slow external storage requirements and to increase the rate of information transmission through a computer.”
With the inception of computer technology, a new world of opportunity opened up that would constitute the next wave of Big Data development. Once again, as with the companies that supported the first era of Big Data history, the computer era produced several key leaders that emerged as beacons of Big Data development. Also, within this era of Big Data development came the notion of analytics and how computers would jump start the future of what is now termed “Cognitive Computing”.
The concept of “integrity” formed a significant part of the success equation for the three Founding Father companies we examined earlier. We saw that customers of these early Founding Father companies were reticent about switching suppliers of mission critical information because they came to depend on the integrity of the information to stay ahead of the competition. In the second era, the computer era, integrity plays an equally significant role in securing the long term loyalty of a growing customer base. Acxiom’s Vice President Global Executive for Privacy and Public Policy, Sheila Colclasure, puts it this way: “For Acxiom, our integrity is central to our success – we’ve built trust over time. You can trust Acxiom to ensure the ethical use of data and also to be dependable, accountable, sustainable, and to deliver. Our clients and partners trust and depend on Acxiom.”
Acxiom is a company today that processes massive amounts of data on behalf of its clients and it continually enriches its own data repository. Throughout its half century history, Acxiom has emerged as a leading Founding Father of the Big Data ecosphere and warrants a special place in the second era of Big Data history.
According to Terry Talley, Acxiom Senior Fellow, “Acxiom was born in 1969 and it was actually a spin-off of an IT department of a bus company. It was the birth of the active use of computers for all kinds of things. The bus company spun off this capability and they started a company that was to do data processing of all sorts.”
Acxiom began life in Arkansas at a time when the Democratic Party in that state wanted to figure out how to leverage data to find voters. At that time, the Party was trying to figure out how to do effective mailings for campaigns. Acxiom was hired to work on the political campaign. That job started a path of processing data for customers that would quickly became the Acxiom differentiator. Acxiom became the “go-to” source for direct mail campaigns of all kinds.
The direct marketing industry really got going under the leadership of Acxiom. In 1970, people used physical mail for outreach to prospective customers. For Acxiom, the challenge was first acquiring a significant amount of data that wasn’t readily available, in particular the names and addresses of the people in the United States. The next step after that required a more sophisticated investigation as customers began asking for more specificity about the individuals they wanted to reach. The notion of a demographic descriptor entered the equation and Acxiom responded by refining the mailing list with added value information such as gender, ethnicity, and income levels. Acxiom’s ability to respond to these data appends became a part of the story of the growth and sustainability of Acxiom. The Acxiom historians agree that the Company’s success grew from this ability, early on, to provide targeted programs that would allow its customers to identify and reach the most appropriate prospects.
Charles Morgan, the founding executive credited with guiding Acxiom through the formative years, wrote an interesting history of the Company in a book titled, “Matters of Life and Data”. When relating the stories that formed Acxiom in the beginning years he points out that when the Company was called upon to work a political direct marketing campaign, there were significant challenges that needed to be overcome. “Back then, voting records were usually buried away in individual courthouses, so it took a massive manpower effort to mine this data and bring it together in one place. That was step one. Step two was for us to buy a white-page telephone list from a company called Metro Mail and match the union membership rolls to the voting data. Step three was … to set up phone banks to start calling these union members, to find out where they stood on a particular issue, and whether or not they needed assistance getting to the polls.”
The significance of this groundwork showed up in the Democratic Presidential election of 2008. Morgan described the early work of the Company as the beginnings of the ground game that allowed Obama and the Democrats to win presidential decisions some three decades later. “It was, he said, “the data gathering skill and large scale name and address processing that would one day put our small company on the world map.”
Acxiom began to apply its computer processing acumen to other marketing challenges. Morgan describes an interesting early business deal the company did with Sam Walton. “Sam wanted cash register tapes from every one of his stores on his desk at 8 o’clock every morning. With those tapes, he could see what every department in every store had sold the day before. The reason he wanted this information is that he didn’t have any cash, and that’s part of the brilliance of Sam Walton’s story – he knew that if he had really good information, he didn’t have to keep so much merchandise in inventory. Sam had no money, so his buyers would go to Spalding Sporting Goods and say, “Spalding, we’re going to buy ten thousand dollars’ worth of basketballs, but we want four weeks from the time we get them in our distribution center to pay you for them.” Because of his tight inventory research, Sam knew he could sell that many basketballs in about three weeks and he got his money the day they were sold. So by the time they were all sold, he would have money in his bank account and still didn’t have to pay Spalding for another week.”
For Acxiom, as the company grew in size and capability, it constantly strived to add more and more computing power to the analytics efforts. Terry Talley stated that, “the essential problem is Big Data is always at the edge of what you could possibly do in a cost effective manner. What Acxiom did was some very creative things around using collections of less expensive hardware, typically used gear, and string them together in what we would now think of as something as horizontal scaling.”
Acxiom built many of the early computer-based solutions to be able to take on increasingly demanding direct marketing campaigns. For example, the Company produced its own version of relational databases that were optimized for highly targeted direct marketing campaigns.
When Acxiom customers learned to rely on the high value mailing lists and effective marketing campaigns that were produced by leading edge software analytics, no competitor could easily unseat Acxiom and today the Company enjoys a loyal customer base comprised of some of the largest brands in the world.