By Danny Bradbury
Is big data just for big business? For several years, larger corporations have been gathering informative insights from this next-generation approach to data analysis. But now small businesses are finding ways to leverage this comprehensive data analysis for marketing insights.
Big data differs from traditional business intelligence. Rather than just exploring "what-if" scenarios, it looks for patterns in data that you might not recognize, and it looks for answers to questions that you didn't even know to ask.
Maximize Online Marketing
Sykes Cottages uses big data to find new opportunities in online advertising. The company started as a family-owned business more than 25 years ago and now markets short-stay cottages on behalf of their owners. As an online marketing company, Sykes should eat and drink data, but four years ago it didn't have a system to look at booking and online advertising data, let alone software that would look for patterns in that data.
Sykes Cottages got a hand from Marin Software, which uses big data to help its clients decide how much to bid for online advertising slots. Sykes also began collecting data about what people were searching for on its Website and combined it with other information, such as the location of customers and the cottages that they rented.
Sykes was able to harvest daily data to discover what triggered people to make a booking, whether it was an external online ad, a telephone call or a brochure download. That information helped the company optimize its online marketing campaigns to maximize revenue.
Keep An Eye On ROI
It can be daunting to allow big data tools to take control, but small business owners should let go and trust the numbers, advises Sykes Cottages search marketing manager Tom Lowes.
“Sometimes we don't know why things are happening," he says. But don't get caught up trying to interpret every data point. “The question is, is it making the business better?"
Lowes helped reduce the firm's cost-per-acquisition by 25 percent when he let the tools assist. Their initiatives also boosted the company's conversion rate by 19 percent for an 8 percent additional investment. To make sure big data is both effective and worthwhile, ROI is key. SMBs should constantly measure spending against the potential return.
Small businesses starting in big data should prioritize senior management buy-in, Lowes adds. The open sharing of information across the company is crucial, and that's something the top level can accomplish.
Check Your Customers' Pulse
Jamie Turner, co-founder of Postcode Anywhere, was on board with big data from the start. Formed in 2001, the 50-person company offers a cloud-based address management service to 10,000 customers.
Turner's team built a suite of in-house tools that pulled in data from systems including production, accounting and customer relationship management. His internally developed big data tool even allows Postcode Anywhere to infer a customer's general mood based on the kinds of interactions it sees across all of its data sources.
Their system is especially useful for understanding customers. Using advanced analytics, the team can spot when a customer is having a combination of problems (accounting issues combined with site errors, for example), and this can trigger a more in-depth conversation to retain that customer.
“We can also see when things are going really well, and that's when you can upsell. That's when you give them a call, because we have all of these core indicators that their mood is rising," Turner said.
Using big data to provide a customer-centric view and spot emerging problems early was key to Turner's success. As a pioneer of big data for small business, Postcode Anywhere also has another trick up its sleeve: not being afraid to expand the data that it uses.
The company is researching how to analyze the sentiment of customer emails, so that it can even more accurately predict a customer's satisfaction level. Turner hopes to one day reward staff members when the mood of their customers improves.
SMBs can use big data today, but acquiring the right skills for this work is important. Whether the solution is cloud-based, as with Sykes Cottages, or built in-house, like Postcode Anywhere, having the skills to understand the data and act on the results is a key part of the equation. Letting the tools deliver the intelligence is a must–but having the expertise to interpret and act upon it is vital.
Danny Bradbury has been a technology journalist since 1989, covering subjects from software development through to security. He has written for publications including Canada's National Post, the Guardian newspaper, the Financial Times, and the Economist Intelligence Unit.
