Everywhere we turn these days, “Big Data” is top of mind. For CMOs, the hype of “Big Data” will soon become a reality. When I think about “Big Data” from the CMO perspective, I divide the world by data source: the Search Web, the Social Web, Web Crawling, and Crowd Sourcing.
Then, for each of the categorical sources of data we, at VDC, are building an inventory of use cases. For the CMO, for example, for the Search Web, the sources of data include both first-party (e.g., Expedia, Cars.com, etc. ) and third-party sources (BlueKai, eXelate, etc.). When we view these companies as data sources, we can begin to create valuable, often-transformational applications using these new sources of “Big Data.”
For instance, by observing and understanding the quantity and geography of searches over time, we can improve the efficiency of a media buy. Example: if I am the CMO of a hotel property and I am a national advertiser using television, I can adjust the timing and targeted market(s) using these new sources of data. In this illustration:
- If search volume for hotel bookings is currently low in Chicago but high in LA, I can adjust my television ad spend accordingly.
- If search volume for hotel bookings are off-the-charts high, I can not only optimize my ad spend by market, but I can increase my overall ad spend in those markets that have exceptionally high traffic to capture more share. Another significant benefit: I can also increase my room rates.
Since high search volume is a leading indicator of the future high level of booking, I have an opportunity to set my rates and maximize profits.
In addition to using search data as a leading indicator of future bookings by market, the CMO can also use the data as a competitive analysis tool. This search traffic can further be broken down by brand:
- How does the directed search volume for my property compare to that for my competitors?
- How does it breakdown by market?
This data is not only useful for competitive analysis purposes but can be used to adjust the advertising message by market – and to emphasize my brand’s advantages over the competition.
Of course, this approach does not only apply to television, it applies to all targeted media: direct mail, e-mail, display, mobile, etc.
Think about the power of these new data sources. What better leading indicator of future demand for a product could there be than to understand how consumers are planning to buy the product in the future as represented by their search activity today? This data surely will transform our marketing processes.
This description represents just one use case of using search data to optimize ad spend and yield superior management strategies. There are many other use cases under development for the search web and there are an equal number of use cases under development for the other “Big Data” sourcing categories: the Social Web, Web Crawling, and Crowd Sourcing.
While this example was for hotel properties, this same use case applies not only for many other aspects of travel-related services but also applies equally well for an almost endless array of consumer-driven industries: auto, financial services, healthcare, etc.
This simple example illustrates the transformational power of “Big Data.” The capability to extract these insights from “Big Data” are here today and the practical application of these concepts to address the CMO challenges of today is just around the corner. It is truly a very exciting time for those of us who work in the “Big Data” business.
– Dr. Charles Stryker