Big data is just the latest hype. For years, we have been overwhelmed with too much information, which did not come at the right time or in the right form to make better decisions. As management guru Peter Drucker expressed it, the computer is the “dumbest tool we ever had”: http://www.mckinsey.com/insights/organization/the_manager_and_the_moron) “The manager with reams of computer output on his desk is hopelessly uninformed. That’s why it’s so important to exploit the computer’s ability to give us only the information we want—nothing else. The question we must ask is not, “How many figures can I get?” but “What figures do I need? In what form? When and how?” We must refuse to look at anything else. We no longer have to take figures that mean nothing to us and read them the way a gypsy reads tea leaves.”
If these words were true in 1967, how much more crucial are they for us today? Every year gives us a new way to understand and reach customers: website optimization, paid search, mobile and location-based, affiliate website marketing, retargeting. It is vital for managers to make sense of these choices, get the right insights on their effectiveness and improve marketing decisions. Analytics allow us to do so. The benefits are huge: a recent study showed that companies who deploy marketing analytics obtain 21% more Return on Assets (ROA) in competitive industries (http://www.sciencedirect.com/science/article/pii/S0167811612000912)
My own work shows even better results for small and midsized entreprises (SMEs). Dutch furniture seller Inofec obtained 16 times higher profits a 16-fold profit increase from implementing insights from analytics (http://video.mit.edu/watch/inofec-5559/) . For an online retailer, we showed that affiliate marketing had more sales effects than any of its other 10 online and 3 offline marketing actions (http://www.msi.org/reports/which-advertising-forms-make-a-difference-in-online-path-to-purchase/). Last-click and first-click attributions failed to show this. The retailer’s managers intuitively felt the power of affiliate marketing and had given it more budget than suggested by click attribution. However, they did not know how much to increase spending on affiliate marketing; it was our analytic model that gave them the answer to substantially improve their profits. For more of such cases across continents and industries, check out my website and book (www.notsizedata.com).
Bottom line: you need analytics to use your data to make better decisions for the better of your company and your own career. In the words of Peter Drucker (1967): “ The manager should use the computer to control the routines of business, so that he himself can spend ten minutes a day controlling instead of five hours. Then he can use the rest of his time to think about the important things he cannot really know—people and environment. These are things he cannot define; he has to take the time to go and look. The failure to go out and look is what accounts for most of our managerial mistakes today.” Happy Bayram and hopes for the best in your Turkish coffee future !