The Young Planner

The relation between Big Data and Strategic Planning

Big Buzz for Big Data

According to Gartner's famous Hype Cycle, Big Data (also dramatized as BIG DATA) is one of world's most buzzed terms these days and has not even reached its peak yet.

McKinsey sees a market potential of 50 billion dollars in 2017 - including a nice piece of this sweet data-cake for Germany, where the topic reached the administrative top level this year. Ogilvy for instance recently created the position Chef Strategy Officer to integrate realtime data analysis in the existing structures.

Big Data is reaching the strategy departments

Hence it's no wonder more and more German advertising agencies are flirting with the idea of securing their pieces - even if it might be realatively tiny ones. 

That's a logical move: If you believe present discussions, the traditional creative-output centred business model of most full-service agencies has reached an impasse. Selling campaigns is not the most rewarding job at this moment, but improving the percentage of strategic consultance could be an answer. Especially if it's driven by numbers.

The problem: Hopes and dreams are enormous, but It seems like neither the agencies nor the clients actually really know what Big Data means or implicates - and this is definetely an important requirement if you want to estimate potentials and derive appropriate options.

 Big Data causes confusion among clients and agencies.

Entering a blurry category

Okay, let's place a first step on this unsteady ground!

Googling the term "Big Data" starts a true odyssee. On the one hand there are dozens of terminology-driven tech-blogs (typical content: "The best way to set up a data warehouse is ...!"), on the other hand we find the same amount of best-case-flooding marketing-sites (typical content: "Obama improved the efficiency of his TV-Spots by 14% using Big Data").

Both make Big Data what I would call a blurry- or fuzzy category. After some hours of desk-research you get a schematic idea about the topic, but you would still fail to explain it in simple words to your parents.

The central learning: Big Data is an old principle in new shoes (maybe rocket boots)

This happens for one main reason: Unlike most of game-changing developments, Big Data doesn't come all of a sudden. It's not even a radical new invention. It's the 21st century follow-up of a basic principle: If you want to make good decisions, you need a good information base.

More concrete: Due to technological process, we're currently facing enormous growth in our possiblities to collect, save and compute an adequate sum of valuable information.

In this reading, several industries already started to utilize Big Data long years ago. Retailers - for instance - use the mechanism of Big Data since the invention of the barcode to make good decisions in case of ordering and logistic.

Big Data means that more and more enterprises - beside retailers or internet companies - will have an easy access to a more sophisticated and enormous amount of data. In some cases even a good frequented web- or facebook-page can provide a significant magnitude and so grant precious hints.

Before I got an Idea what the Big Data phenomen is all about I had to detour.

Maximizing three steps of decision making

Let's rush over this rough model of data-driven decision-making:

1) Collect: According to experts the global data volume will be 8 Zetabytes in 2015, a number  already so high that our brain fails to understand this incredible volume.

2) Save: Without methodical records, this high volume of data would be very useless. Falling prices for data-storages make it possible to save every single action that's finding its way to the net.

3) Combine and Condense: There are two main problems if you collect an incredible amount of data. First you will most likely own a big variety (transactional data, video-files, structured and unstructured texts, etc.), second you won't be able to scan and analyze everything on your own.

That's maybe the most central and fascinating point of the game. The technical progress of the last years even solved both constrictions. Now we have the software and power to actually really utilize a ton of different data and create huge connected databases.

Sounds futuristic, right? I will give an example.

IBM's Watson: When the Big Magic happens

I can clearly remember the news two years ago after an IBM super-computer called Watson had beaten some American Jeopardy champions. Everybody was impressived by the technical possbilities, even if no one had an idea about the magic behind this technology at this point of time.

Watson was equipped with several huge databases including complete Wikipedia (Collect, Save), but he was first and foremost able to transfer the human-made, often ambigouos and unstructured speech of Jeopardy into computable, structured data-sets (Combine) and find the correct answer in his packed data storage using his algorithms (Condense).

Super-computer Watson can transform unstructured into structured data and so leverage and connect different data-bases.

Let's talk about Bounty-Muffins 

Some weeks ago I talked to a developer of Germany's leading producer of Big Data sofware and asked him if their tools would have any chance of being viable in 2014.

He was amused: "Man, this software is allready really working for some companies. It's not science fiction any more!"

His company was consulting a chocolate manufacturer looking for promising product-extensions using a software tool comparable to IBM's Watson. After harvesting gigabytes of data from several cooking-forums, blogs and social media platforms, they found a correlation between the positive notions of Bounty and baking muffins for german women with an age between 32 and 39. This Insight led to a product-cooperation supported by a targeted Facebook campaign.

"That's the future of advertising!", he stated and I'm quite sure that some marketing departments would agree. "It's efficient and measurable, maybe the big answer for the problems advertising has been facing the last years."

To be honest: This wasn't the message I was looking for. Should Big Data be the end of strategy as we know it instead of a perspective? Will Watson or one of his upcoming brothers easily print a Creative Brief in seconds and upcoming campaigns be inspired by correlations found in huge data sets?

Stanley Kunbrick's 2001: A Space Odyssey: Super-computer Hal 9000 can only fake real emotions.

Algorithms only tell the boring part of the story

I think the answer (or let's call it: relief) can be found in different perceptions of the word Insight.

Let's see what Big Data software engineers use this term for:

• Buying a light blue bedside carpet is correlated with being pregnant with a boy. 
• German high schoolers are buying twice as much chewing gum in February than in July.
• Bounty and muffins are a good match.
  

Can you imagine that these perceptions lead to any inspiring campaign-idea? - I highly doubt that. Our creatives would flip me the bird if I would present it to them.

Let's contrast what a strategic planner would rather call a real insight:

• A cultural code connects baby boys and the colour light blue. Buying a bedside carpet could be a personal tool for the parents to mark this caesura and prepare their home for a exciting and unfamiliar new phase of life.
• There must be an important event in February. Isn't chewing gum a classical tool to focus and gain concentration? The high purchasement volume could probably be linked to the school leaving examinations in February then.
• I'm not that sure about the bounty-muffins - maybe it's related to the taste of a special sweet these women used to love in their childhood.
  
  

These small sketches demonstrate a way of thinking that goes beyond correlation and I'm relatively sure that it should be one central asset of a good strategist.

Data-crunching can't replace this intuitive perspective. One could say that just because there is so much data in the new information society, intution becomes increasingly valuable!

See this amazing statement of Greg Satell relating to David Ogilvy:

The Big End

We see: Big Data and our way of thinking can be combined to a powerful asset. Utilizing big amounts of high quality and often non-reactive data like never before (for a rising number of clients) could  bring strategic planning to a new level and inspire great campaigns with unconventional insights. In addition there could be opportunities for new data-refinement services: According to McKinsey, only 0.5% of collected data has been utilized yet.

Another good news: We don't have to be scared by the idea of becoming obsolete. Mechanical micro-targeted advertising could be a nice way of improving online banner-ads, but they will never replace idea- and insight-driven campaigns.

Some questions still have to be to be answered though:

• Will agencies get access to the client's data storages?
• Will agencies be able to afford the needed software?
• Will the strategy- need to co-op with the it-department or will we be able to use user-friendly interfaces?

Thanks for reading! Let's see what the future will bring for our exciting profession ;-)

Kind regards,

Jonathan, Berlin.



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