DEEP insight This document is an authorized copy for personal use of Mr. Skiera, 25/03/2017 MARKETING IN A DIGITAL AGE Using Big Search Data to Map Your Market By BERND SKIERA and DANIEL M. RINGEL R ecently, we ran a marketing work- To our surprise, the participants were shop with an experienced business stumped. First, it took them a very long time development manager from Ama- to convert the data into a format that would al- deus, the tech provider for the travel low them to answer basic marketing questions, industry. The workshop focused on Travel Audi- because the sample sizes were far too big for a ence, Amadeus’ online advertising platform for conventional spreadsheet program. They strug- travel companies. Participants were given four gled with separating causality from correlation. data sets, ranging in size from 770,000 to more And finally, they complained about the amount than 9 million “observations” – which reveal of data they had to analyze – until we remind- how users or consumers behave and interact in ed them that the data sets they had been given a specific market category. We asked the partici- barely covered a week! pants to analyze the data and answer a few basic This experience illustrates that, unlike yes- marketing questions: Where does the company terday’s marketing professionals, marketers to- make the most profit? Where should it spend day need to upgrade their data-handling skills. more money on advertising? What is the return It’s not enough to ask a junior professional to on investment in terms of advertising? do the work for you. Marketers who can pull 31 ISSUE 32 FIRST QUARTER 2017 https:/ /dx.doi.org/10.15581/002.ART-2982
Using Big Search Data to Map Your Market Big data present distinct challenges. Marketing professionals do not have to become IT specialists. But successful marketers will be those who also have solid math and data-management skills. and read the numbers themselves are in a much information boom. The internet enabled mar- This document is an authorized copy for personal use of Mr. Skiera, 25/03/2017 better position than those who have to run to keters to measure, on a grand scale, when an someone else each and every time they need to advertisement was shown and how consumers retrieve key data, waiting days or weeks to get reacted to it – how many clicked and how many the information they want from the IT depart- proceeded to purchase. ment. Being able to read and react faster to mar- With the ubiquity of increasingly affordable ket shifts will lend a competitive advantage. and powerful smartphones, the sea of data has With so many brands and products and so grown exponentially. On top of all existing data, much big data available today, where does one companies can now also collect vast quantities begin? Interpreting the competitive relation- of location-based information on consumer be- ships among 1,000 different products is ex- havior around the clock. tremely difficult and would entail a gigantic, While having more and better information unwieldy table. As such, we came up with a way is a good thing, big data present distinct chal- of visualizing competitive market structure in a lenges – from poor data quality, to incomplete single map. This makes it more manageable to data sets, to mistaking correlation for causality. devise effective competitive strategies, pricing There are several signals that marketers are policies and communication. behind the learning curve. It used to be that the This article explains our approach. Using chief concerns of marketing were to develop data of large markets with more than 1,000 com- creative slogans and strategies. In fact, many peting products, we show how companies can people went into marketing precisely because tap into big data and visualize competitive mar- they didn’t want to do math. The digital revo- ket structure. Various parties can benefit from lution, however, has changed all that. While this method, which reveals valuable insights on coming up with creative content will always be customer behavior. central to the profession, marketers now have to take a data-driven approach to prove that their The Big Learning Curve of Big Data ideas actually work. Ever since the advent of the browser, market- This development doesn’t mean market- ers have been trying to get to grips with the ing professionals have to become IT specialists or set up databases and IT architecture them- selves. Such tasks can and should stay with the IT department. However, it does mean that suc- EXECUTIVE SUMMARY cessful marketers will be those who also have Markets today are flooded In this article, the authors solid math and data-management skills. The with an increasing number of describe how they used rise of crowdsourced platforms, such as Kaggle, products and brands, making clickstream data to visualize to carry out predictive modeling and analytics, it diffjcult for companies to competition in product as well as the growing popularity of online data- track how their products categories containing more analysis courses, are testament to marketing’s compete in the market. Big than 1,000 products. Both wider remit. search data allow companies manufacturers and retailers Market Share and Competition to obtain valuable insights on can profjt from their approach, market share as well as on key which yields more meaningful Recently, a manager at a price-comparison competitors. But collecting information on customer website mentioned that his firm could quickly and analyzing vast amounts of behavior than traditional predict the success or failure of a new prod- data pose huge challenges. market research methods. uct by simply following the outbound clicks to 32 FIRST QUARTER 2017 ISSUE 32
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