There’s no magic in “big data”
The rise of “big data” – huge data sets that can be mined by computers to reveal patterns and trends – has spooked the little guy, says Frances An. Traditional market researchers fear their stock-in-trade may soon be redundant. And consumer privacy advocates worry that corporations harvesting personal data will give rise to “surveillance capitalism”. A case in point: an employee of retailer Target claims to have used big data to discover a teenage girl’s pregnancy before her father did.
Still just guessing
That “might sound frightening”, but the use of big data is really just an “enhanced version of educated guessing”. In the case of Target, the pregnancy was identified based on some pretty basic statistics about pregnant women’s buying habits. Often the guesses are wrong. “To use myself as an example, for the last three years YouTube’s advertising algorithm has steadfastly insisted that I am a pregnant woman who is desperate to send money to relatives in Vietnam. Only the woman part is correct.”
The truth is that no amount of data mining can uncover the effect of specific contexts, motivations, relations or the decision-making process behind someone’s actions. “Google and YouTube cannot seem to connect my searches for pre-1975 Vietnamese songs to my interests in Asian pro-democracy movements, despite the fact I look up both regularly.” And neither is evidence of family roots there.
An oft-cited advantage of big data is the ability to obtain a large and representative sample, but the reality is that getting a truly representative sample is no easier with big data than it is using older sampling methods. Nor does big data get around other problems. The average consumer, for example, does “not consciously reflect on the reasons they chose Colgate over Oral B and would rather market researchers leave them alone about their toothpaste preferences”. Big data will not make you any the wiser. As psychoanalytic market researcher Ernest Dichter once said, asking an average consumer about a buying decision is like asking a patient why they are sick.
Rather than get obsessed with huge data sets, companies would be better to focus on building brand identity and using older methods that often yield good results, such as well-designed focus groups to gauge customer satisfaction and gain insights to improve products. Such methods remain “foundational” for market research, and big data, although helpful in some circumstances, is not going to change that.