With Big Data, What Really Matters? | Jump Associates

This post was written by Claudia Glasser, Director of Business Development here at Jump. You can reach her directly by commenting on this post.

90 percent of all the data in the world has been generated over the last two years. The electronic trails left by our business and personal activities, and now millions of connected machines, have given rise to what you may have heard called Big Data: data so large that it’s often difficult to process using traditional database and software techniques.

Recently, the phrase has been thrown around more frequently as it relates to consumer behavior and information. Despite the fact that it’s not exactly clear how best to use this data in many cases, and that consumers aren’t exactly sure what data is being collected, the term is so ubiquitous that it’s hard to go five minutes without seeing an article talking about something relating to Big Data.

As Dan Ariely said, “Big data is like teenage sex: everybody talks about it, nobody really knows how to do it, everyone thinks everyone else is doing it, so everyone claims they are doing it.” And like teens having sex, if Big Data is done thoughtlessly or without proper concern for privacy, it can have lasting consequences for the reputations of all involved.

I don’t have all the answers. In fact, I’m still struggling myself with the ethics and morality surrounding Big Data as a blanket concept. Even so, I think there are a few things that companies ought to keep in mind as they consider committing resources into Big Data and begin needing to explicitly establish strategies surrounding its use:

It’s essential that you have an end goal: Your business needs a big “why” around Big Data, and no—it doesn’t need to sound conventional or obvious.

Tesco acquired video-on-demand service Blinkbox in 2011 as part of a push into digital entertainment. According to Michael Comish of Tesco, Tesco wants to “be the world’s first successful multichannel retailer.” Realizing that customers are going on more and more nonlinear customer journeys, it’s using massive amounts of data to bundle offers with shoppers’ favorites—like dinner and a streaming movie. Tesco has expanded its offerings immensely, while also giving consumers better deals and a more streamlined experience.

Do you have an end goal for your Big Data, or are you collecting it just to collect it? Setting a Big Data strategy can help you be much clearer about what’s within acceptable boundaries and what isn’t for your consumers and your business.

Transparency matters: A while back, Netflix ran a public competition offering third-party developers a $1 million award for creating the most effective movie recommendation. As MIT Tech Review notes, this “was an open acknowledgement that Netflix was using users’ movie-viewing histories to provide increasingly targeted, and thus more useful, recommendations.”

Your business doesn’t need to run a developers’ competition to create a sense of transparency, but your leadership should be vigilant about being as open as possible about what you’re collecting and why you’re collecting it. This sort of vigilance is important so you don’t create a culture where inappropriate practices are covertly used—a scandal waiting to happen in this era of immense data. Without transparency, you risk losing trust.

It’s easy to lose trust, and even harder to gain it back: Facebook and Google both collect large amounts of data, and analyze it to sell ads, and both say they’re offering some benefit to users—like social connection or better search. While Facebook hasn’t yet been compelled by the force of law to start thinning their data set—like Google has in the EU—it’s no more trusted, either. Facebook’s immature attitude towards privacy continues to remain its Achilles heel when it comes to trust.

Businesses shouldn’t wait until they’re compelled by the force of law to be more transparent about the data they’re collecting, because by then, it’s likely already too late. It’s fine to collect data, but pushing the boundaries of its use is a good way to create problems. Have a voluntary position on Big Data long before you’re forced to have one.

The statement that it’s easy to lose trust and even harder to gain it back has always been true, but it’s never been as relevant as it is in today’s era when data collection is the norm. Especially given Millennials’ wariness of brands that abuse privacy, it’s essential that brands do everything they can to hold onto what trust they do have. This is, in many ways, a culmination of my two comments above. With an end goal and a transparent playbook surrounding Big Data, it’s much easier for businesses to retain—and even grow—consumer trust.

Businesses all around the world are collecting data about consumers in droves. But at what cost?

Like a scalpel, Big Data can be a powerful tool for good. Or, it can inflict harm without strong considerations of the ethical implications of its collection and the legacy it may leave on organizations and their customers. These three cornerstones—an end goal, transparency, and trust—may not provide all the answers, but they can at least give your business a decent place to start a thoughtful engagement with consumer data.

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photo credit: shoothead via photopin cc

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With Big Data, What Really Matters? | Jump Associates