Question

Detail why and how marketing analytics are so vital in the age of big data.

Answer 1

1. Marketing Analytics - Marketing analytics is the practice of measuring, managing and analyzing marketing performance to maximize its effectiveness and optimize return on investment (ROI).
2. Big Data - "Big data" is a field that treats ways to analyze, systematically extract information from, or otherwise deal with data sets that are too large or complex to be dealt with by traditional data-processing application software.

According to an article published in the Forbes Magazine - "Big Data has the potential to utterly transform the relationship that individuals have with institutions, customers with companies, patients with the healthcare system, students with universities, and voters with government. And that means once it has fully penetrated society and industry, the Big Data revolution may very well prove a turning point in our economic – and ultimately, cultural – history as great as the electronics revolution. . . perhaps even as great as the first and second Industrial Revolutions."

Marketing is the way an organization undertakes its activities to promote the buying and selling of its products by the means of advertising, selling and delivering products to consumers. Marketing Analytics is a prior step to promoting the product as it studies about the market scenarios through various forms of consumer based researches. For a marketing activity to be successful it is necessary to know about the target audience first i.e., about their tastes and preferences, needs, social status, etc. The data so collected from the prospective consumers in a society of a particular product is very huge and to gain accurate results from this data big data analytics is used.

As an organization expands so does the competition for it and this is where the need for big data arises. For a marketing technique to be successful it is important to implement the technique at the earliest as the needs, wants and behavior of the consumers are subject to change with time. These are the ways in which marketing analytics helps in the age of big data:

1. Faster, better decision making- With the speed of Hadoop and in-memory analytics in big data, combined with the ability to analyze new sources of data, businesses are able to analyze information immediately – and make decisions based on what they’ve learned.
2. New products and services- With the ability to gauge customer needs and satisfaction through analytics comes the power to give customers what they want. Davenport points out that with big data analytics, more companies are creating new products to meet customers’ needs.
3. Price Optimization- Marketing analytics helps to understand competitor pricing of the product in market and benefit the organization by shaping demand and meet financial goals.
4. Customer-centric planning - Predictive and prescriptive analytics and advanced clustering helps to understand a customer's path to purchase and further optimize merchandising decisions to improve the customer experience.