Big data analytics expected to grow to $100B in value by 2027

This article was contributed by Dmytro Spilka.

As the world online becomes increasingly congested in the wake of competitors discovering the potential of a rapidly accelerating market, big data analytics is quickly becoming an essential way for businesses to outperform their many rivals. With this in mind, how best can companies tap into the wealth of data left behind by consumers to better understand the ways they can mould their marketing campaigns?

Statista data suggests big data market volume is set to top $100 billion over the next five years. This indicates that the marketing industry’s early analytical adopters are likely to pave the way for greater prosperity in the age of the “new normal” as ecommerce continues its growth away from the COVID-19 pandemic.

Recent years have hosted a significant increase in the market volume of big data, and the pandemic is likely to ensure that this growth is sustained throughout the decade. This presents plenty of opportunities for marketers to strategize their growth beyond the ecommerce boom period brought on by the pandemic and widespread consumer adoption of online shopping.

We can see that big data analytics has not been recognized as an essential facet in the sales and marketing departments of the pharmaceutical industry — more so than in any other sector. In fact, big data is almost twice as prevalent across this area of the industry as artificial intelligence.

“The pandemic gave a big boost to the digital revolution, and accelerated the world’s transition into the digital space,” explained Maxim Manturov, head of investment research at Freedom Finance Europe. “During the pandemic, a large number of financial transactions were processed electronically, a trend that is expected to continue. Both PayPal and Square provide a fast and convenient way to transfer funds, and they have played a significant role in the growth of ecommerce.”

The COVID-19 pandemic has undoubtedly left in its wake a terrible impact on a humanitarian scale. However, the arrival of lockdown measures and social distancing came at a time when emerging digital services like the aforementioned payment providers PayPal and Square have paved the way for a thriving digital transformation across the retail landscape.

Accompanying them is the fledgling world of big data, and this level of analytics is poised to herald a new era of high-quality insights for greater customer engagement.

The benefits of big data analytics adoption

Big data is an even bigger topic in the world of marketing, but why has it taken on so much importance? There are many ways that this technology can be utilized by businesses in benefiting their digital marketing approaches. Some of the key pros of big data can be seen below:

• Analyzing competitors: It’s possible to gain valuable insights into your competitors’ campaigns as well as the behavior of your customers. This can help you to see what does and doesn’t work in a market that’s likely to have fundamentally altered in the wake of the pandemic.
• Observing market trends: Today’s market is different from yesterday’s, but that doesn’t mean that historical data can help you to understand what’s likely to happen tomorrow. Demand forecasting and prescriptive analysis action items can allow you to gain insight into when customers are more likely to be interested in your product or service to help you prepare.
• Forecasting profitability: Using big data for targeted marketing can help to reduce your ad spend, shorten your supply chain, and help your marketing campaigns to be placed under the noses of the right customers at the right time — leading to far better business growth.

Each advantage of big data adoption has been prevalent for some time, but the acceleration of digital transformation and the growth of the technology surrounding the industry means that high-quality insights and analytics have never been more accessible, powerful, and necessary.

The new age of precision marketing

The era of the COVID-19 pandemic has seen the widespread adoption of precision marketing from businesses aiming to gain any kind of advantage in a rapidly growing and changing marketplace.

However, precision marketing is only as efficient as the data that’s driving it. For instance, modern models built using old data are still likely to deliver inaccurate insights. This means that marketers in the age of the new normal will adopt a more wide-angle approach to data collection, which relies on not only behavioral trends and location-based analytics but also third-party insights on relevant businesses, customers, and competitors to help shape their in-house customer data.

Companies looking to make the most of their external big data options are hopeful that epidemiological data from governmental bodies, as well as customer mobility and sales data from third parties, are intent on using this broader spectrum of data to incorporate into their models.

By utilizing this added valuable data, marketers will be capable of identifying spikes in demand and where the new custom is coming from. They can also see which customer profiles have upped their spending and where lapsed customers are going.

“Before it updated its modeling approach, for example, a retail chain could only tell how many customers it was gaining or losing,” wrote Chase Bibby, Jonathan Gordon, Gustavo Schuler, and Eli Stein in their McKinsey article. “The company then decided to pull in cell-phone data to scan changes in their competitors’ net traffic. That analysis showed that many of the customers they were gaining during the pandemic were coming from more expensive, specialty players, while those they were losing were heading to cheaper, larger-format players.”

“On the basis of this information, the retailer transformed its onboard and churn-prevention campaigns. They sent emails advertising higher-end offerings to customers transitioning from specialty stores while touting bargain-oriented products to value-oriented customers at risk of churn,” they added.

Furthermore, this bigger brand of big data enables marketers to leverage better insights into the performance of their rivals. By comparing third-party sales and campaign performance to their own numbers, companies have the ability to evaluate their customers’ receptiveness to every component of their campaign. This helps to pave the way for unprecedented foresight into the personalized content that can be offered in terms of tailored messaging and segmented offers.

The battle to deliver the best experience

Although COVID-19 has certainly paved the way for a marketing landscape where customers expect technology to deliver a seamless shopping experience, these expectations were already growing prior to the pandemic.

Customer-facing ecommerce outlets like ASOS or Glossier had long been delivering hyper-personalized experiences through the optimization of big data among its customers.

“When the coronavirus hit, digital transformation accelerated overnight,” said Janet Balis, CMO practice leader at EY Consulting. “This, in turn, sent consumer expectations skyrocketing in terms of what companies could do for them with a more digital experience. The customer expects so much more than just a seamless digital transaction.”

In the age of GDPR, customers are far more aware of the significance of their personal data. Subsequently, in return for agreeing to share their personal information, they’re expectant of fine, personalized, and anticipatory experiences to suit their newfound expectations.

To match these spiraling customer demands, marketers must be aware of three strategies to ensure their experiences fit the bill:

• Seek to ensure that brand scores are a vital KPI for the entire customer-facing side of the company — this would seek to incorporate real-time analytics into the fold to ensure that businesses are never looking into the past for insights.
• Utilize the right data and technology to support the right use cases throughout the customer journey.
• Work to align individual and collective goals throughout each stage of the customer journey in order to mitigate the impact of functional silos within marketing, sales, and customer service for customers.

As we move towards the age of the “new normal,” the scale of the challenges facing businesses is sizable. Digital transformation has created an ecommerce gold rush as more competitors fight for conversions online. To accompany this, the expectation of consumers is growing exponentially.

Big data analytics will play a key role in the ever-evolving world of digital marketing. Emerging technology will pave the way for a $100 billion industry by 2027, which will help to provide businesses with the opportunity to generate industry-leading personalized experiences for their customers.

Dmytro Spilka is a writer based in London and the founder of Solvid.