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Small Data

The buzzword of 2013 is Big Data. Well, so far at least. We still have a few months to go before we can officially award the honor. But the term is everywhere. It's enough to give anyone not working with large data sets a complex.

The term has moved into mainstream as more and more brands are beginning to collect data at every touch point, from social to sale. But is all of this data helping or hurting your insights? The answer is:  it depends. If you are a business analyst charged with enhancing an operational process, then more data points may help you hone your output. But, if you are in charge of putting the right message in the hands of the right consumer, at the right time, then additional data might be clouding your view.

For example, Netflix is collecting and analyzing a large amount of viewing data to influence programming choices. This makes perfect sense since creating personalized recommendations heightens the relationship and can increase usage and retention rates. But, they are also capturing screenshots to analyze "in-the-moment viewing habits" like "volume, colors and scenery, to provide valuable signals about viewers' tastes". How much time and money are being invested to generate this level of granularity? If I paused and rewound two car chase scenes, does that mean I really like that genre, or did I simply use the basic feature of the service:  the ability to stop and start movies around my schedule? How does this level of detail correlate to my selection history? I have a feeling that Nate Silver might question this level of analysis paralysis, and some subscribers might question any recommendations created at this level.

In most cases, Big Data is not necessary to successfully manage a CRM program. Simply collecting and aggregating customer purchase data will provide details on the buying cycle. Adding response data to the mix will provide feedback surrounding communication and offer effectiveness pre, during and post purchase. With the addition of a few household metrics from a third party data provider, you can create customer profiles for targeting and tactical optimization. And finally, you can always augment those profiles with qualitative data. One simple way to collect that data while enhancing the relationship between customers and the brand is to ask.

Are They Listening?

Maybe it's a slow news week already, or maybe it's a bigger deal than we originally thought, but it appears Netflix's CEO Reed Hastings is under fire again for making what critics believe to be a disastrous business decision.

The main point of Hastings' announcement (posted on the company's site: http://bit.ly/pdA81h) is to attempt to apologize for July's rate increase debacle (AKA "The Worst Thing to Ever Happen to White People"):

Netflix Relief Fund with Jason Alexander from Jason Alexander

Buried more than halfway down the page, however, is what is probably the real point of the post: The announcement of the separation of their Instant Streaming business from their DVD/Blu-Ray mail service (rechristened as Qwikster, even though that Twitter handle is already taken - yet another misstep in the process.). Here's an amazingly produced 3 ½ minute long video that elaborates on the post:

After scouring comments on a few of the most recent articles about this, (see comments on the YouTube video above for an example) I guess the real issue that I struggle with is how a company, born online, reliant on the Gen Y / Millennial tech-savvy demographic, could be so seemingly bad at listening to and communicating with its customers. The very fact that Netflix issued this apology not in July, when the flurry of negative online conversation persisted, but instead when the balance sheet started reflecting the actual drop-off, tells me that this great company still has a lot to learn about listening to their customers.

Thanks to a wealth of amazing new software packages, companies large and small can monitor and engage with their customers fairly easily online. From simply receiving alerts to building a full-scale sentiment management and online conversation campaign, businesses like Radian6, Sysomos, and Klout offer powerful platforms to assist companies in online listening and reputation management.

Maybe it goes without saying that listening to our customers is paramount to a successful business. I'm not necessarily saying that companies should radically shift their models and economic plans based on customer opinion. I would argue though, that 50% of the message isn't actually WHAT you say, but HOW you say it. I'm not sure Netflix understands that yet.

What would our businesses look like, how would our customers perceive us, if we connected with them in a way that makes them feel heard? What have you learned by listening to your customers?