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How Big Data Might Harm Your Business

How Big Data Might Harm Your Business

The rise of Big Data has been reinventing the way marketers work in the past few years. Indeed, through the use of analytical tools, marketers are able to precisely measure the impact of their marketing efforts. This has helped the profession gain relevance since its contribution to companies can now be precisely measured.  However, for marketers with little critical thinking, the use of Big Data can also be a barrier to long term profitability.  

Since the surge of the buzz word "Big Data", marketers have shifted their focus from long-term marketing strategies to short-term marketing campaigns. Indeed, since they can easily put numbers on short-term promotions, brand building, which is a long-term investment, is neglected. This shift in focus may be useful to reach quarterly sales target, but it is often to the detriment of the company's long term profitability.  This tension between short-term promotions and brand image has been stimulated even more since the rise of Big Data.   

How to overcome this challenge?

Marketers can overcome this challenge by integrating these two following tactics in their overall marketing strategy.

1. Don’t Make Decisions Based Solely on Data:

            To avoid making marketing moves unaligned with the company's values or brand, marketers should never rely solely on data. Data only shows correlations between two variables, this doesn't mean that these variables are related/influence each other. Tylervigen.com (http://www.tylervigen.com/spurious-correlations) is a website that shows some spurious correlations. You may encounter some spurious correlations in your data. To find the root cause of a phenomenon, marketers have to use other tools like observation sessions or surveys.  As elegantly stated by Martin Lindstrom in his book "Small Data: The Tiny Clues That Uncover Huge Trends", " Big Data is all about finding correlations, but small data is all about the causation- the reason why." So, marketers, make sure you always understand the root cause of a phenomenon before making a marketing move, otherwise, you may harm your organization's long term profitability.  

2. Striving for Balance is Striving for Greatness:

Marketers need to strive for a balance between promotions and image-building in every marketing effort. Many companies try to achieve this on the portfolio level by dedicating resources for short-term promotions and some for the long-term marketing strategy. Instead, companies should try to communicate their brand value in every message shared with the customers. They should never look too desperate to acquire new customers as it will harm their brand image.