From Information to Audiences: The Emerging Marketing Data Use Cases

Executive Summary

Data DivideNo matter what analogy you prefer, one truth is undeniably clear: Technology has fundamentally advanced the creation of what many call “big data.” Consider:

  • From the dawn of time through 2003, according to Google’s executive chairman, Eric Schmidt, human civilization generated approximately 5 exabytes of aggregate information. In 2009, that much data—captured in the equivalent of 25 quadrillion tweets—was generated every two days
  • Globally, businesses created 1.8 zettabytes of data in 2011, according to IDC. That output—enough to fill 57.5 billion 32-gigabyte Apple iPads—is growing approximately 62 percent annually (on a compounded basis)
  • In July 2011, Facebook’s 750 million worldwide users uploaded approximately 100 terabytes of data every day to the social media platform. Extrapolated against a full year, that’s enough data to manage the U.S. Library of Congress’ entire print collection—3,600 times over.

The world’s Twitter feeds, iPads and libraries may not stand a chance against this onslaught of information. But to the world’s marketers, the proliferation of data has given rise to what may prove to be the most substantial commercial opportunity since the emergence of the World Wide Web: the ability to better understand consumers, seamlessly match “right-time” offers to their needs and optimize the management of profitable, long-term customer relationships.

Not surprisingly, many are working feverishly to capitalize on the new potential of marketing data, especially with respect to the torrent of highly insightful (but highly unstructured) information being generated online. The ongoing convergence of new data sources, targeting technologies and advertising delivery platforms is likewise shifting their focus—from the management of raw information to the optimization of granular consumer audiences across discrete advertising channels, product categories and geographies.

The demands of real-time, rules-driven, audience-centered marketing represent a full-on paradigm shift in how marketing is done. But with the opportunity inherent in this approach comes a daunting challenge: to identify and deploy an actionable range of “use cases”—practical marketing applications that, fueled by data, may drive transformative improvements in both marketing effectiveness and efficiency.

Today, even while some enjoy modest success in redeploying their existing resources to the new cross-channel task, most other marketers—saddled with legacy technology platforms, depleted of expertise by years of underinvestment and structured only to support “traditional” approaches to data usage—are finding they’re woefully unprepared for this transformation. For them, a growing data divide is taking shape, distinguishing those use cases to which data may now be profitably deployed from those which—though promising in their strategic potential—still represent nothing more than ideals of how automated, multichannel marketing may someday take shape.

This white paper—produced in conjunction with the Interactive Advertising Bureau—will explore four data-driven use cases (audience optimization, channel optimization, advertising yield management and targeted media buying) that collectively represent the foundation of how many are now seeking to leverage the potential of “big” marketing data. In addition to that analysis, it will demonstrate that capitalizing on this opportunity will require:

  • Rules-driven integration of disparate data sets: The collection, analysis and segmentation of digital data demands the aggregation and anonymization of virtually all data, challenging marketers’ fundamental ability to draw distinct insights from consumers’ cross-channel interactions
  • Improved operating infrastructures: Though substantial process and data structure challenges also exist, a substantial barrier now inhibiting wider marketing data optimization resides within the marketing organization—characterized by rigid “silos” and the paucity of data-savvy marketing operations, IT and sales talent
  • A strong network of data-centric technology and service partners: The fastest and most efficient data aggregation, analysis and throughput solutions require a strong ecosystem of partners who understand and can integrate seamlessly with core data assets and supporting technologies
  • Marketing data governance: While organizations have long employed policy experts to advise on the regulatory ramifications of data utilization, many are coming to see marketing data governance—defining the “rules of the road” for assigning distinct data sources to different promotional tasks—as equally important.