I’m often asked whether big data can provide the same opportunities for small businesses and independent traders as it can for big corporations. My answer: absolutely! While the average small business has less self-generated data than big players like Google or Facebook, this doesn’t mean big data is off limits. In fact, in many ways, big data is more suited to small businesses because they’re generally more agile and able to act more quickly on data-driven insights. Let’s look at some of the ways small businesses can make use of big data, which I have taken from my book Big Data for Small Business For Dummies.
Thanks to big data, small businesses can get a fuller picture of their customers – what makes them tick, why they buy, how they prefer to shop, why they switch, what they’ll buy next, and what factors lead them to recommend a company to others. Companies can also better interact and engage with customers by analyzing customer feedback in order to improve a product or service. Useful data sources include traditional in-house data (like sales data and customer service logs), social media, browser logs, text analytics, and large, public data sets (such as census data).
Social media has become a particularly valuable source of data, making activities such as identifying niche markets and analyzing customer feedback much easier and cheaper. Twitter – where almost all conversations are effectively held in public – is easier to mine than most platforms.
Spotting and monitoring behaviors and patterns allows us to take a stab at predicting where things are heading, how demand for our products or services will change over time, and what will prompt that change. Until recently, trend analysis and prediction often came down to ‘gut instinct’. Now, big data is taking a lot of the guesswork out of that process.
Trending topics flash across Facebook and Twitter every day, making it easier than ever before to work out what people want. Services such as Trendera and Trend Hunter collate trend data and use it to answer specific questions for businesses. In retail, online and offline customer behavior can be measured to microscopic detail – even down to how someone moves around the physical and online store. That data can be compared with external data, such as the time of the year, economic conditions and even the weather, to build up a detailed picture of what people are likely to buy, and when.
In the past, understanding your competition was limited to industry gossip or looking around rivals’ websites or shops. Some might go as far as pretending to be customers in order to find out more about a competitor’s service or product. These days though, you hardly need to leave your desk to find out what the competition is up to; financial data is readily available, Google Trends can offer insights on the popularity of a brand or product, and social media analysis can illustrate popularity (i.e., how often a company is mentioned) and show what customers are saying. Again, Twitter is a particularly transparent place to start. All the information you gather can be compared with your own brand; for example, does your competitor get more mentions on Twitter? How do their Twitter conversations with customers compare with yours?
Keep in mind that it’s also easy for your competitors to glean more information on your business than ever before. There’s no way around this, but you can stay one step ahead by keeping up-to-date on the latest big data technologies and uses.