Customer Retention Strategies: Big Data’s Contribution

Big Data: Tunnel or Window?

Big Data: Tunnel or Window?

Whether it’s college enrollment or consumer behavior at Target, the buzz in the marketing world is all about “big data.”  Crunching big numbers to better understand why customers behave the way they do.  But does the data really help to create customer retention strategies?  Let me argue why both are needed.

Big data is clinical.  Imagine white lab coats and gloves.  And, big banks of computers.  Spitting out statistical correlations about the average purchase amount for customers who use credit versus debit cards.  Interesting.  Helpful?  In some cases.

Customer Retention Strategies

Room for Two?

Customer retention strategies, gleaned through hands-on research — interviews, surveys, focus groups — is more like digging in the dirt to find roots, grubs, and the occasional golden nugget.

The appeal to us is that, when we’re talking to humans, we can ask any question that seems pertinent based on the thread of the conversation.  The same doesn’t hold with computers: the data just might not be available for the question that comes up.

Consider an example of where ‘big data” went wrong in the entertainment world.  “Duck Dynasty,” a show on A&E Channel, with a very loyal following, got into hot water in early March 2014.  Its star, Phil Robertson, a devout Christian, made an anti-gay remark in an interview in GQ magazine.  Then, the Twitter world took off: you would have thought that oligarchs in the Ukraine were being skewered.

Judging from the overwhelming negative reaction, through the Twitter window, the show’s producers sent Mr. Robertson into a suspended state: it was the only way they knew to ameliorate the situation and keep the public from an uprising.  What they didn’t know, however, was that  most of the Tweets were coming from the East and West Coasts — right where you’d expect the LGBT community to be most populous and…most vocal.

Here was a case where big data was able to provide plenty of information — but not the kind of information that was useful.  Why?  Most of the show’s viewers are located in the Midwest and South: they weren’t violently tweeting against the offensive opinions of DD star Phil.  They were fine with his preachings and ruminations.  The end result?  When the producers figured out the data they got was not important to their show and its followers, they reinstated Robertson.

Big data?  Quite useful some of the time.  Not all of the time.

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