The amount of data in our world has been exploding. It has never been so big. Today, a growing number of people are spending a lot of time online to record everything significant—or maybe not so significant—in their daily lives and share it with others. Businesses have huge amounts of data about their operations, customers, suppliers, and competitors than ever before. More and more sensors are embedded in the world around us through smartphones, cars, and connected homes while detecting things, creating data, and sharing it. Undoubtedly, this exponential growth of data will continue.
Across industries, big data has now become a key enabler for growth. There are a number of technologies for big data collection and analysis. How to understand it and finding a way to use it, however, is a whole different story. Learn how some of businesses have been incorporating big data analytics into their organizations.
Google and Facebook deliver targeted, customized ads that meet the interests of specific individuals using the data collected from the user’s interaction with their site. Netflix suggests a set of movies based on the user’s viewing patterns. A popular navigation application in Korea, “Driver Kim” became famous for providing real-time traffic updates when it was released. Creating competitive advantage with big data does not only apply to the IT industry. Zara, a fast fashion retailer, uses big data to manage inventory, logistics, and distribution. In case of auto insurance, it was pioneered by Progressive with a customized insurance rate based on a driver’s actual habits. Seoul City decides whether to expand the hours and routes of late night buses using traffic data during late night hours.
Value-Added Big Data
1. Sharing Big Data
Increasing accessibility to big data can create value. For instance, if a government agency makes its data ready for other agencies and related organizations to securely use, they can save time to search and process data, which will lead to improve work efficiency. A similar instance can be found in the medical industry. Hospitals usually store clinical records in digital formats while medical insurance companies store medical and billing records about their customers and pharmaceutical and healthcare companies store their research data in database. If a government agency can centralize medical-related data which used to be managed in a dispersed way, it will help to control medical costs and improve service quality.
2. Understanding Needs through Big Data Analytics
Many of our daily routines are recorded digitally. People perform their work using computer while creating and storing huge amounts of data. Work related data is extensively wide from inventory data to employee attendance data. When such big data is effectively and efficiently captured, processed and analyzed, organizations gain a clear and complete understanding of their business. For instance, by managing its inventory based on real-time sales data, Zara limits stock-outs, markdowns, and fashion risk, and tailors each store’s inventor to the local demand.
3. Market Segmentation
Before big data got its name, demographic factors such as gender, age, region, and occupation have been highly influential in developing marketing strategies. In the big data era, it becomes important to figure out how you can leverage big data to develop more effective marketing strategies. With big data, you need a new approach to target micro-segmented markets and deliver services customized to match the needs of the segmented markets. For instance, Target, a US-based global retail chain, provides customized coupons to segmented customer groups by analyzing consumers’ patterns.
Every day enormous amounts of data are being produced worldwide and the effect of big data is being felt everywhere. Harnessing big data is becoming a business imperative to achieve sustainable growth and competitiveness. IBM CEO Ginni Rometty emphasized its importance by saying, “Data … needs to be refined. It will determine undisputed winners and losers across every industry”. As big data continues to grow, the most successful, competitive organizations will be the ones with the ability to leverage big data technologies to gain new insights.