Big Data, Data Science and the future of Marketing
The role of Data Science in Business
The influence of Big Data and Data Science on the basic understanding of marketing is currently discussed in many articles. There is talk of completely euphoric new approaches and possibilities or of the end of marketing as we know it today.
However, marketing still means dealing with customer acquisition, customer retention and the development of customers into regular customers. This hasn’t changed much, even though today the Internet with its many methods of advertising and acquisition is in the foreground of almost every marketing plan. BigData promises better access to customer needs, better understanding of customer behavior and continuous revenue growth through online portals.
Big Data Marketing means integrating Data Science as a new position in marketing
Data management and data analysis is the new holy grail for a new generation of marketing professionals who trust that all the data they collect – and this amount exceeds every imagination on a daily basis – can be truly analyzed and evaluated for their own customer structures, market segments and customer needs so that conclusions can be drawn about (purchase) behaviour. Unfortunately, however, the large amount of data that is available even in companies today (ERP, CRM systems) has not yet led to a significant increase in customer loyalty. On the contrary, the Internet with its many search and information levels has led to the fact that customers today change faster and sometimes no longer permit any binding, regardless of which marketing methods companies use today. Systems such as Google AdWords promise again and again that it would only depend on the budget to attract new customers every day. But this is not the case.
Today, BigData means a lot of mathematics and visualization methods, which at least allow us to recognize trends and develop meaningful forecasts from them. These methods must also be integrated into your own systems, such as ERP and CRM. In some cases, this is not yet possible and so the number of software systems continues to grow in the IT landscape. This creates the need to implement data management and data analysis as a new discipline in marketing. One speaks of data science in this context and understands it as specialists, who can draw credible conclusions from it by means of special analyses with huge amounts of data, which can also occur in small companies.
Gartner predicts that by 2017, CMOs will have to manage much larger technology budgets than a typical CIO today. The CIO is already under considerable pressure to defend and/or justify his budget against that of the marketing department. The big change for the traditional role of CIO has been underway for a long time, since CMO typically sees all information and data streams as its core competence, not just since the social media hype. This shows how future marketing departments will work. In the top 500 companies worldwide, the CMOs’ budgets already devour those of the CIOs, which means that today we can almost see the vision of a Peter Drucker – marketing is everything, sales are abolished – almost fulfilled. The big challenges will be to understand the most different methods of BigData marketing in the first place, because we rely on the analysis tools or rather on software algorithms.
Data Driven Relevant Marketing as a Vision of Big Data Marketing
What is interesting about this apparently new marketing method is that it focuses on an analysis: the customer lifetime value and its valuation. In addition, this new marketing approach aims to optimize the automation of most marketing activities and processes and to improve the analysis and evaluation of the budgets used with regard to the customer. This approach was discussed as early as the mid-1990s and was then called the One-2-One Marketing Approach and Customer Relationship Management. So nothing new then?
Last year, McKinsey painted his own image of the future in which we will live, as an on-demand world where consumers will recognize brands through their skills and competitive advantages, where increased communication via social networks will achieve better performance in the market and target groups, and where extreme personalization will influence consumers. You no longer decide for yourself, but the communities in which you move, make the preliminary decision on the basis of lifestyle and social networking, when, where and what to buy. And of course this is optimized by the many data from the coming Internet of Thing and a BYOI (“Bring your own identity”), which partly communicates and buys independently. Nice new future.