With access to new data sources — social analytics and other web data, as well as better access to sales and other customer data — and to huge amounts of inexpensive computing power, lots of people are calling for Big Data to replace traditional market research. We believe that would be a mistake. Big Data analytics should be used in addition – not instead of – traditional market research.
Big Data can be extremely useful for a variety of purposes. It can be useful for operations management, inventory management, and what you’re most interested in, marketing. In fact, Forbes recently reported that Target used their data on shopping patterns to figure out a teen was pregnant before her father knew (oops!). There’s no question that there is tremendous opportunity to build valuable models that drive business performance taking advantage of the wide range of extensive data sources available today. Our industry-leading Marketing Science group is working on developing a variety of approaches to this. We already use a variety of data sources in our Agent-Based Modeling approach to forecast potential scenarios in our Brand Tracking work.
However, there are at least two key areas in which Big Data, by itself, falls short. There are times when one wants to really get a “lay of the land,” which requires representative samples that cannot be provided in an analysis of social network data. A vast amount of social data – possibly from millions of people – does not mean that the general market for a product or service is accurately represented. Additionally, some business problems are best answered with an experiment, another way that survey research can answer some questions better than through an analysis of Big Data.
Don’t get us wrong, Big Data analysis and modeling can be very valuable and we encourage the development of these skills. Big Data can be a valuable tool in a researcher’s toolbox to help answer the question that we at LRW ask ourselves everyday when faced with complex business issues, so what?®. However, it is not the “be all, end all.” It will not – nor should it – replace survey research. It is critical that great so what?® thinkers use survey data, social analytic data, and available spending and behavioral data to figure out what actions companies should take to solve complex marketing and business problems. We shouldn’t allow this “shiny new object” to replace something good. Rather, this shiny new object should be added into the mix of how we attack business problems.
Do you see Big Data differently? What do you think of the opportunities and pitfalls that come with Big Data in solving business issues? Do you think that Big Data means the death of market research?