By J.T. Ripton
Modern business often seems like an art of buzzwords, an increasingly complex set of concepts designed to get business people to buy in to yet another new idea. But many of these new ideas are the wave of the future and being able to find them is crucial.
One new buzzword is “big data”—sources of information deep enough to defy easy exploration and exploitation, demanding newer means of data mining. Such data troves have been thought of as the preserve of big business, but new techniques put the lie to that truism. Below are some reasons why small business owners should strongly consider availing themselves of the information from these data sources.
Because It’s There
The first reason to consider using big data is a simple one: because you likely already have it. In the information age, businesses accumulate customer information at an increasing pace through contact with multiple sources. This information, while inchoate on the surface, is a huge resource disguised as detritus. Think of it like an unexpected oil strike on a piece of property: sure, the owner could just leave it be and avoid the expense of extraction but ultimately doing so is just leaving money on the table.
Of course, your internal data might not be big enough to put the big in big data. The good news is that outside data sourcing is increasingly in the price range of smaller operators. This information is available for purchase from many external sources with excellent penetration, including ISPs, mobile carriers, and other Internet ventures. A small investment, tailored to both your business’s capability to pay out and the demographics of the communities you serve, can gr29ab you a rich vein of information to use in building your strategies going forward.
All smart businesses look for feedback to evaluate the effectiveness of their products and services, and big data is yet another channel for said feedback. While more conventional methods, like direct customer feedback, can provide plenty of foundation for a revised strategy, a deeper look at large chunks of data can let your business see in very minute details the traits and motives behind the purchasing behavior of your clients. After all, customer responses can only tell you what a consumer thinks they need; analytics can tell you about needs the customer hasn’t yet discovered.
As a further expansion of the previous point, the feedback provided by an analysis of big data can allow you to create highly personalized customer experience. Studies show that ads work best when targeted closely at consumer demographics, and the more data fed into the system to make that targeting specific, the better your marketing will be at capturing the consumer’s attention. Moreover, any broad marketing salvo will necessarily contain a great deal of chaff in the form of goods and services the customer is unlikely to want; a micro-targeted approach, bolstered by data analytics, makes sure you are never wasting your customers’ valuable time.
Maintaining the Competitive Edge
This same level of personalization can work against the small business owner. In the past, the difference between large and small businesses had a lot to do with the personal touch; customers who shopped small did so because they felt that the establishments they frequented were more likely to know them as human beings rather than balance sheets. While there may be an irony in discussing data mining as a way to ease that perception, the fact is that personally targeted marketing becomes easier with access to deep data sources. Small businesses may need to dabble simply to maintain a competitive posture.
Words like big data bring to mind giant computers from old films running reel-to-reel tape and punch cards or mainframes in staid office clean rooms being maintained by suited and bespectacled operatives. However, the truth is far more commonplace: Big data is simply a collection of information waiting to be exploited by businesses to aid their goals of providing quality to their customers. And what could be better than improving your business’s ability to serve customers? Sometimes, common is good.
JT Ripton is a freelance writer out of Tampa, who focuses on topics relating to business and technology. Follow him at @JTRipton.