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DMA show tackles Big Data's big questions

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How can marketers address the challenges of Big Data? Panelists at last month's Direct Marketing Association annual conference and expo in Las Vegas discussed multiple strategies, such as beefing up number-crunching power, outsourcing technology and aggressively resisting government regulation of behaviorally targeted marketing. Marketers now have access to so much information that data management platforms are becoming essential, said Bruce Biegel, senior managing director at the Winterberry Group, in a DMA session assessing major trends for 2013. He termed this development “the rise of the machines.” But deployment of such platforms is lagging due to a lack of clarity about their role within the C-suite, as well as concerns about customer privacy and data governance, Biegel said. “We're including transactional data, e-commerce data, mobile commerce data and social data,” he said. “Then there's all the browser analytics data. And TV set-top data will have to be watched. With thousands of attributes, the challenge is trying to figure out which ones matter.” The rise of social media is making the use of data in customer relationship management processes overwhelming, said Brian Fetherstonehaugh, chairman-CEO of OgilvyOne, and a DMA keynoter. While social media is a “game changer” in dealing with customers, he said, it can also be invaluable in identifying true customer value. Fetherstonehaugh said marketers should look beyond simple customer loyalty and lifetime value, and seek customers who influence other purchasers—those who are “socially plugged-in and interested in co-creating a brand,” he said. “We need to think of customers in a broader, more comprehensive way.” The way to do that, he said, is combining traditional CRM processes with social media analytics. “The winners in the decade ahead will be those who can pull together these two collective forces,” he said. Technology on its own doesn't hold all the answers to Big Data and CRM, some experts said. IBM Corp. recently established a 24/7 social monitoring center in India that relies on people to identify trends important to clients, said Buell G. Duncan, VP-marketing software group at IBM, who presented with Fetherstonehaugh. “Then we have our IBM experts—developers of our offerings—engage in and nurture those conversations using demos, white papers and invitations to events to generate leads and incremental revenue,” Duncan said. “The real challenges are about following up on opportunities quickly and effectively enough to turn them into real business.” At the end of the day, plain old intuition may be a marketer's best friend, said Wired Editor in Chief and “long tail” visionary Chris Anderson, in the opening keynote address. “Data beats HIPPOs [“the highest-paid person's opinion”] every time, but you can't just let data tell you where to go,” said Anderson, author of “The Long Tail: Why the Future of Business is Selling Less of More” (Hyperion, 2006). “Sometimes you need to show innovation, to do something and let the customers decide.” Marketing departments need visionaries with “leadership, courage and radical new ideas,” complemented by statistical techniques and testing to make sense of the data deluge, Anderson said. He warned against “raging incrementalism,” his term for data dominance that compels marketers to overtweak and overtest landing pages, messages, graphics and campaign elements. Instead, he said, marketers should use common sense and instinct to determine probabilities about correlations. “Apply your own skills, with a hunter instinct that something might be true,” he said. “Then construct experiments on Big Data to further advise your approach.” Conference sessions also addressed questions and criticism about Big Data's privacy implications. At the conference's opening session, Linda Woolley, DMA acting president-CEO, announced a new lobbying and customer education program called the Data-driven Marketing Institute, an initiative designed “to set the record straight” about marketers' collection and use of data. The initiative will focus on advancing the marketing industry's efforts to limit government regulation of online data collection and behaviorally targeted advertising, as well as support its own efforts at self-regulation. Woolley cited dozens of pieces of pending legislation inspired by what she termed “scare tactics” that would restrict or ban the collection and use of data for marketing purposes. “DMA cannot allow these mischaracterizations of what we do stand,” Woolley said. “It's time for us to be forceful and take action. The data-driven industry must demonstrate our value to consumers, the economy and the world.”
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