In fact, the skill is proving to be more useful now than ever. Startups all over the country are incorporating big data technology as a major part of developing their business strategy both digitally and traditionally. Simple ideas such as Netflix, Uber and Foursquare became large successes by the use of big data. Even companies in small cities like Erie, PA use data-mining to build their own ideas. In order to be one step ahead of their customers, innovators researched what their potential customers wanted more of, who their friends were and everything the potential customers liked - before the customer even realized it.
According to an article on Datanami.com, Netflix uses machine learning to engage customers and help them determine the user's preference. For example, when an user watches something, they can give a rating which will help Netflix determine what movies and TV shows to suggest to them. They can also see patterns in a user's queue to determine what types of movies they're most likely going to want to watch.
Uber uses regression analysis, which can determine the size of a neighborhood, price of the houses in the neighborhood depending on prices, demographics, schools and other information. According to Datanami.com, Uber uses this information to determine which neighborhoods will be busy on the weekends, which areas have the most bars and clubs, and when to add "surge charges" to their customers' bills. Like Netflix, Uber uses regression analysis to determine customer satisfaction, and since this type of big data is so sophisticated, it can also take other variables like the weather report into factor. According to Datanami.com, "it works best with quantitative data."
Foursquare uses a data-mining method called social network analysis. With this technique, Foursquare essentially finds the greatest "influencer" in a social network group and markets specifically to them, in hopes that said "influencer" will market the product to their friends. Social network analysis is so intricate that out of all the information it collects from the user, it only takes into consideration likes and dislikes, and studies the patterns between people and their ties between those with similar patterns and interests. According to the article on Datanami.com, Foursquare's approach focuses on the importance of one individual in a group and the minimum number of connections between two people. From there it can not only market places, but products and neighborhoods to individuals or one individual directly called a "maven" in big data terms. The maven then recommends this location to their connections and the other friends will follow suit.
Big data isn't just limited to these digital platforms. Small businesses in areas across the United States are opening up to the idea of taking a non-traditional approach. For instance, four businesses in Erie, PA were able to open debt free from using an innovative fundraising campaign called Quickstarter.
Creator of Quickstarter Kris Wheaton, an associate professor of Intelligence Studies at Mercyhurst University in Erie, studied other Kickstarter campaigns in the Erie area and tried to measure their success. Compared to other cities in the state and nationally, he concluded that the city of Erie was "both underrepresented and had a higher-than-average failure rate."
Would-be business people have their own skills, but often need some support in designing effective fundraising campaigns on Kickstarter. Intelligence students at Mercyhurst University were paired with these owners to essentially do the "dirty work" for them. Students studied neighborhoods, city-trends, and potential audience in order to develop a strategy that would prove to be most successful on Kickstarter. The four Quickstarters launched by Wheaton and his students were fully funded in less than the allotted 30 days.
Data analysis can be used for many different functions, but ultimately serves one purpose – growing a startup to its greatest and fullest potential.
* This skill is not dying, in fact, it’s becoming one of the most sought-after skill-sets for college graduates. If this is something that interests you, I encourage you to take a look at the Ridge School at Mercyhurst University’s various data science programs.
Adele Stewart is the Director of Social Media at Epic Web Studios, a web development & strategic planning agency in Erie, PA, and Public Relations blogger. If you have questions about running a successful digital advertising campaign, contact Epic Web’s Social Media team today!
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