by Angela Guess
A team from McKinsey & Company recently shared how companies are successfully leveraging Big Data and advanced analytics. Jonathan Gordon, Manish Goyal, and Tim McGuire wrote in Forbes, "$50 billion. That’s about how much marketers are spending on Big Data and advanced analytics (according to a BMO Capital Markets report) in the hopes of improving marketing’s impact on the business. This commitment reflects a belief that big data and advanced analytics can transform business. While, at times, the promise has fallen short of the reality, some companies are already seeing significant value. Recent academic research found that companies that have incorporated data and analytics into their operations show productivity rates 5 to 6 percent higher than those of their peers."
What are Big Data businesses doing right? First, they're asking the right questions: "The more data-rich your business becomes, the more important it is to ask the right questions at the beginning of the analytical process. That’s because the very scale of the data makes it easy to lose your way or become trapped in endless rounds of analysis. Good questions should identify the specific decisions that data and analytics will support to drive positive business impact. Asking two simple questions, for example, helped one well-known insurer find a way to grow its sales without increasing its marketing budget: First, how much should be invested in marketing, and second, to which channels, vehicles, and messages should that investment be allocated? These clear markers guided the company as it triangulated between three sources of data, helping it develop a proprietary model to optimize spending across channels at the zip code level."
photo credit: 401(K) 2012