Big Data – Big Opportunity
The world is becoming datafied resulting in opportunities to build new services that enhance consumer experiences through improved targeting and personalization. And with that, big data is changing the world as we know it! This datafication is going to have a significant impact on the economy, science, and society in the years to come. It will bring dramatic changes to various industries, be it healthcare, manufacturing, retail, finance, consumer retail, amongst others.
Big Data is the next big thing. It’s a revolution! The sheer volume of data being generated and the emerging science of big data used to crunch that information and analyze it instantly to draw meaningful conclusions is becoming a critical source of economic value and a source of innovation.
This emerging science will change the way we think about business in years to come. Big data has the ability to predict the future behavior of consumers and render information in ways that can produce useful insights and services of greater value that we never could have imagined before.
We would have been processing big data long ago had it been possible. However, it has been made possible only due the technological advances, which includes datafication of things, cheaper hardware, free open source software and cloud services that offers increased storage capacity and faster processing power in an on-demand utility model.
When it comes to big data, it beats the traditional methods of analysis by allowing us to process as much information as we want and quickly! It allows companies to work backwards by first collecting the required data for analysis and then deriving conclusions based on the patterns.
However, this huge pool of data comes with its own set of problems. The larger the data, the more likely it is to have errors and noise, thus making it imperative that data scientists take time to carefully clean the data before using it for any analysis.
Even though we have only just scratched the surface over what big data can do, yet it is set to change the world. So what all can it do? Let’s take a look.
Datafication - is a term that is being used to represent the next phase of digitalization. Digital technologies and social media is generating data by just about everything and everybody around us, which could be an outcome of transacting online or offline, sharing information over the web, searching for information, social media interactions, internet of things, wearable technology and mobile devices.
Prediction – All this data resulting from datafication is enabling us to better understand the world’s physical, social and economic infrastructure. Intelligent use of the data is being infused in every aspect of our lives to help improve customer relationships and create new smart products and services. Hence, analysis of this data is making it possible to not just understand the present, but to also make precise and accurate predictions about the future. One of the key benefits of analysis of this big data is prediction in the form of probabilities.
Correlations and Causations – Correlation is not causation which means just because two factors are correlated does not necessarily means that one causes the other. However, correlations and trends are extremely useful for anyone trying to make a prediction about future circumstances. Big data moves us away from creating this causal link, and helps us see the data more clearly, and allows the data to speak for itself. Therefore, helping us discover correlations that one would have never looked for.
Decision-making - What’s the point of all that data, anyway? It’s to make decisions. Analysis of big data will help businesses find strategic answers to essential questions. For instance, in today’s competitive environment, businesses will benefit from big data by linking useful transactional data, and layering in social consumer behavior to arrive at analytic-based decisions.
This is just the beginning. The amount of data that surrounds us is becoming a key competitive edge, and the companies with the greatest access to data, will win over those who do not. Data oriented companies like Google, Amazon, and Facebook are expected to continue innovating in this space. Large traditional players such as Walmart, Target, Nestle and others are also making investments in big data initiatives to start collecting and analyzing data to improve consumer targeting. The valuation of companies such as Facebook where users are generating massive amount of big data would continue to increase due to the value of the information they are sitting on.
There is big value in big data, which in turn has led way to the rise of data owners, data entrepreneurs and data analysts who crunch, clean and convert the data into useable information. Data owners and data entrepreneurs are now seeking opportunities in reusing, merging or combining the data they are holding on to, and so there has been a growth in companies who now ‘broker’ other company’s data sets.
In the world of big data, the mindset with which researchers approach a dataset can make all of the difference. Let’s look a few examples of how big data is getting used by today’s forward thinking companies:
- Credit card companies generate data on billions of transactions globally. They are now analyzing this data to understand trends, patterns and insights. By analyzing historical transactions and running them through sophisticated predictive models, they are able to forecast potential customer churn.
- eCommerce and other online services are investing heavily on recommendation and personalization software that analyzes big data to suggest relevant results to users. When done well, this can translate to an exponential increase in sales and customer loyalty.
- Retailers, airlines, hotels and others have started to adjust pricing in near real-time for millions of items based on demand and inventory.
- Search engines are leveraging semantic data that relies on text analysis, machine learning and even synonym mining to produce relevant search results.
- Telecom players are aggregating and analyzing anonymous user data that they are then selling to retailers to get interesting insights.
- EdTech startups track the performance of their online courses to constantly improve their offerings.
- Logistics companies are using geo-location data to optimize drivers’ routes and to know exactly where every driver is at any time. Route optimizations help save fuel consumption and thus have a direct effect on costs and the impact to our environment.
- Retailers analyze sales during certain events and use the findings to capitalize on specific consumer needs and place certain products that do well during those periods close to checkouts.
- Mobile phone companies have massive access to geo-loco data that they sell to companies to create real time traffic reports.
Digitalization changed the way we communicated with one another, but datafication will completely redefine every aspect of the human existence. For all businesses, big or small, there lies an untapped potential to have a winning strategy by deciphering the big data!