13 Aug Big Data and Marketing: What’s the Big Deal?
The speaker at the American Marketing Association New York Capital Region Chapter Breakfast Brief in May was Neerav Patel of IBM. In front of an interested and packed audience, Neerav answered the question: “Big Data and Marketing: What’s the Big Deal?” EVP of Programming, Will Trevor, caught up with Neerav after the event and asked him some further questions about his fascinating talk and the relevant topic of big data.
Trevor: There’s a lot of people talking about Big Data at the moment, but what exactly is it and where is all this data coming from?
Patel: Big Data is a term applied to data sets whose size is beyond the ability of traditional relational databases to capture, manage, and process the data with low-latency. And it has one or more of the following characteristics – high volume, high velocity, or high variety. Big Data comes from sensors, devices, audio/video, networks, log files, transactional application, web, and social media – much of it generated in real time and in a very large scale.
Trevor: IBM recently acquired The Weather Company, so why does weather matter to businesses?
Patel: That’s a good question. Weather is often associated with having a negative impact on business. But according to recent research from the IBM Institute of Business Value (IBV), many companies across the world are gaining a competitive advantage by combining industry-leading technologies with weather data to discover new strategies for reducing costs and increasing revenues. According to the survey: 99% of business executives surveyed say improved weather insights can reduce annual operating costs. And 93% of business executives surveyed report that improved weather insights can positively impact annual revenue growth, 68% of the executives surveyed expect that weather insights as a service would be more valuable than raw data
From the business standpoint, weather is a significant driver in P&L’s… Consumers purchase products based upon weather conditions.
Trevor: Can you give us some real-world examples of how weather-related data has been used by organizations to drive their marketing?
Patel: I’m going to lay out a couple of studies that show how weather data has been used by organizations for marketing plus the tangible ROI.
The first example shows the influence of the seasons.
To capitalize on consumers’ desire to decorate their homes during the holiday season, a leading home improvement retailer – the largest seller of live Christmas trees – came to The Weather Company with the goal of driving awareness of its home décor solutions such as blinds, furniture, and home accents that maximize holiday decorating, and top home improvement items such as tool sets and grills, sure to be on holiday wish lists.
Capitalizing on the insight that seasonal firsts drive energy, optimism, and a strong consumer response, we leveraged the WEATHERfx seasonal first trigger along with other media to engage holiday shoppers during key shopping times including Black Friday and the Friday before Christmas.
The campaign resulted in an overall increase of ~1000% in CTR’s above the client benchmark
The second example involves food. In today’s healthy-eating climate, consumers are more aware of the ingredients in their food and often seek healthy alternatives. Because of this trend, a leading bakery-café brand came to The Weather Company looking to drive trust and increase sales among consumers, while reinforcing the notion that the brand’s menu features craveable, clean food that consumers can feel good about eating.
Weather not only affects what kind of food people crave, it also affects whether people even go out to eat in the first place. With this in mind, The Weather Company leveraged animated branded backgrounds to capitalize on the impact of weather and bring the brand’s 100% clean creative to life. Dynamic store locator functionality adapted messaging to the user’s weather and location, pulling in the nearest store locations.
In addition, the brand’s clean eating creative was integrated into native carousel units which showcased multiple menu items in a native environment, and applied WEATHERfx targeting using activity and relative condition triggers to run media when optimal conditions were present to increase foot traffic.
From this marketing campaign, we saw a 22% sales life, 188K incremental store visits, a 69% increase of CTR’s (vs. client benchmark), and a 30% waste reduction.
Trevor: How do you use data to map consumer journeys from real-world behaviors and how is this useful to marketers?
Patel: We use consumer journeys (location data) from approximately 20M daily mobile users, collecting their location data and observing their journeys over time. From there we map that data to specific, real-world places with unmatched accuracy and precision and then use IBM backed cognitive computing to analyze those journeys to create Portraits. These portraits help determine who you should target, who else might be valuable, what you can learn from them, and when you should reach them with targeted advertising
Trevor: What exactly is Watson and why do you see natural language processing and machine learning as key to gaining insights from large sets of data?
Patel: Watson, like Siri and Alexa, uses Natural Language Processing to identify user input. Watson, like Google, ranks potential responses.
However, Watson understands the question. It tears apart the sentence and understands its pieces. Not just the keywords, but the verbs, and the adjectives, and the what, how, where, and who. From there, Watson works against this is the answer
I think you’re looking for (and this is why, and this is my confidence level) – much like how you and I talk.
Trevor:You talked about cognitive advertising as the ‘next frontier in advertising’, so what is it and why do you think that it is going to be so influential?
Patel:Cognitive advertising is the utilization of AI. As I had mentioned we have IBM’s Watson and from there Watson Ad’s was developed… Watson Ads is an industry-first capability in which brands can drive a one-to-one conversation with consumers at scale, delivering deeper and more beneficial brand engagement. Consumers will interact with Watson through advertising by asking questions via voice or text and getting a response that matters to them.
Watson’s machine learning and natural language capabilities enable accurate responses, giving consumers a fun, surprising, informative, and highly personalized experience.
Trevor:To sum it up for us: why do marketers need to know about Big Data and why is it such a ‘big deal’?
Patel:With the volumes of data exploding in the last several years and by 2020 it’s projected that there will be trillions of billions of data produced every day, marketers need to know about Big Data because it will provide insight for customer engagement, customer retention and loyalty and marketing optimization and performance.