Devil lies in details? 

Big Data and Digital Marketing

Since the unification of networks around the world with the TCI/IP protocol and the emergence of internet followed by the creation of the World Wide Web developed by European scientists at CERN (European organization for nuclear research), our world has changed, and keeps changing faster and faster. Internet has enabled a shift in the way we do business. A company can now become multinational much easier and faster than 30 or even 20 years ago. So, in order to survive in an increasingly competitive market, companies had to adapt. 

But what has changed? First of all, the information flow has rocketed, and as they say, information is power. With the increase of computation power and the development of algorithms, companies evolving in the cyber space started gathering and analysing as much data as possible in order to determine an efficient strategy for their businesses. Knowing your customer is obviously the best way of satisfying him/her by bringing him/her the maximum value and thus generating higher profits. And that is why big data and digital marketing are so strongly linked to one another. By knowing your customer and what he/she values, you have a better idea of what to do in order to fulfil his/her needs. Indeed, the gathered and analysed data help companies to understand who their customers are, and how to offer them what they need.

Here are some examples of digital marketing strategies using big data analysis:

Amazon’s A/B test: The online platform Amazon uses A/B tests to determine what is the more effective web design. Basically, when you go on the Amazon website, you see either the A type homepage, or the B type one. Those different homepage designs have a unique purpose, draw customer’s attention to make them click on a specific window by using different web design techniques to lead you on buying the promoted product. An algorithm then analyses the results by counting the amount of clicks for both homepages and selects the one that has the higher conversion rate. That way, Amazon selects the best homepage design and increases its profit.

Starbuck’s text message marketing: In the US a couple of years ago, Starbuck was sending coupons via text message during rush hours. Drivers that were stuck in traffic jams were localised and invited to drink a Frappuccino in the nearest Starbuck, just the time to relax and get rid of the traffic’s stress. A coupon exclusively usable in the nearest Starbuck was sent and it was a big success for Starbuck’s sales.

Marriott Hotels price setting method: Marriott is an American multinational hospitality company that also uses big data analysis to maximize value for their customers. Marriott uses big data across the hotel chain’s operations. Structured and semi-structured datasets such as weather reports, local events schedules are used to forecast demand and determine value for each individual room. Those prices also adapt depending on the customer and its personal data, if it is available on Marriott’s large customer database, to set prices with optimum efficiency. 

All those practices use big data analysis to increase the value for the customer and the company as well. But how much information can a company gather without risking to compromise your privacy rights? Most of the time, we willingly share information on Facebook for example, even though Facebook’s privacy policy is still quite ambiguous and there is a controversy about whether or not Facebook sells those data to other companies. Google is another giant company that collects a lot of data from its users. As you know, every research you type on Google is recorded and used to profile you. Imagine what kind of person is your cyber self. It probably isn’t the same person as your real self, but Google still define you by what you search or what you watch on the internet.  Sometimes, we don’t even know in who’s hands our personal information are. Some companies are specialised in gathering private information about people in order to sell them to other companies that will use our data to establish a marketing strategy. We call those companies data brokers. They aren’t that well known but they are very big. For example, a British data broker company called Experian generates a yearly turnover of 4.8 billion dollars. The controversy is pretty big on that subject and the market is not regulated, at least not enough.

To conclude, internet has brought us a lot of good things: easier access to information, easier access to product or services, etc., but maybe we need to be more careful and protect our privacy a little bit more firmly. Our privacy is not something to be taken lightly.