"Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today’s column is written by Tom Manvydas, vice president of integrated marketing services at Experian Marketing Services.
Marketers are increasingly taking advantage of the richness of CRM, purchase transactions and other offline data sources for online advertising. Yet, so far, it’s been a one-way street: There is very little being done with online data to improve offline marketing programs.
That will soon change. With the continued growth of data from the connected world, it is only a matter of time before we see offline marketing practices influenced heavily by online data.
There’s a ton of it. In May 2013, some estimated that more than 90% of the world’s data had been created in the previous two years. While the value and usefulness of all that data is debatable, Google has proven that too much is not a bad thing.
Data is the tool that is changing the marketing landscape. There are some great programs that measure the online impact of offline marketing, primarily by directing consumers to online response channels, such as email addresses or social media content. Broadcast advertising is becoming more like addressable marketing with the growth of digitally powered screens and satellite radio technology. And while the reverse – applying online data to offline marketing – is not widely used yet, some key drivers will accelerate this trend.
Bridging the physical world with the virtual world is becoming increasingly efficient, in terms of capabilities and economics. The Internet of Things pushes us toward a path of seamless interoperability between our physical and virtual worlds. Depending on which forecast you believe, we will have 50 billion (PDF) to 200 billion connected devices by 2020. What we only imagined in science fiction is now closer to reality than most people realize, and will open up access to even more data.
Historically, most data has been stored and locked away. The lack of access limited the usefulness of data, but the connected world has changed this. Not only is more historical data being published online, but the incremental creation of what we used to call offline data has transitioned to online technology. We see the profound impacts of this already in education, health care, government services and law enforcement.
When you can determine the precise location of any connected device, you end up merging the physical and virtual worlds in an always-on state, which is the almost perfect application programming interface. Simply carrying a connected device will create a stream of online data that alters actions in the physical world. Have you ever wished you had a self-driving car that could automatically maneuver you away from traffic jams and accidents? You’re in luck. With precise location apps already on the market, your physical location problem days are numbered, as they become an everyday tool for the physical world.
Anyone who has toiled in the world of data understands that data interoperability is the principal challenge for data applications. In other words, once you have mastered data definitions, taxonomies, mappings, cleansing and ETL rules, everything else becomes remarkably simple. This is hard for a single organization. Fortunately there is a growing list of open-source data initiatives, such as CKAN or Data.gov, that are starting to address this perennial problem. We are just at the very beginning of this data renaissance. But when massively large data sets start to “talk” to each other at scale, we will see new applications for data that will help address challenging issues like chronic diseases, famine, population growth and environmental damage.
When it comes to data, we typically use less than 5% of what’s easily available. We hardly even look at the potential information from combined data sets, which is where you’ll find the real value of data. Just solving 10% of this utilization gap will have a profound impact on the world and certainly will be useful for any marketing program.
These growing trends, along with the improving economies of scale of data technologies, already allow online data to impact the relatively mundane world of offline marketing. Yet the impact could be so much greater. Even technologically advanced out-of-home advertising formats, such as digital billboards or location-based LCD screens, do not take advantage of the ever-growing store of online data. There is a huge advantage for marketers that recognize this opportunity and start thinking about how they can use this wealth of online data to boost their offline marketing.