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Small Data

The buzzword of 2013 is Big Data. Well, so far at least. We still have a few months to go before we can officially award the honor. But the term is everywhere. It's enough to give anyone not working with large data sets a complex.

The term has moved into mainstream as more and more brands are beginning to collect data at every touch point, from social to sale. But is all of this data helping or hurting your insights? The answer is:  it depends. If you are a business analyst charged with enhancing an operational process, then more data points may help you hone your output. But, if you are in charge of putting the right message in the hands of the right consumer, at the right time, then additional data might be clouding your view.

For example, Netflix is collecting and analyzing a large amount of viewing data to influence programming choices. This makes perfect sense since creating personalized recommendations heightens the relationship and can increase usage and retention rates. But, they are also capturing screenshots to analyze "in-the-moment viewing habits" like "volume, colors and scenery, to provide valuable signals about viewers' tastes". How much time and money are being invested to generate this level of granularity? If I paused and rewound two car chase scenes, does that mean I really like that genre, or did I simply use the basic feature of the service:  the ability to stop and start movies around my schedule? How does this level of detail correlate to my selection history? I have a feeling that Nate Silver might question this level of analysis paralysis, and some subscribers might question any recommendations created at this level.

In most cases, Big Data is not necessary to successfully manage a CRM program. Simply collecting and aggregating customer purchase data will provide details on the buying cycle. Adding response data to the mix will provide feedback surrounding communication and offer effectiveness pre, during and post purchase. With the addition of a few household metrics from a third party data provider, you can create customer profiles for targeting and tactical optimization. And finally, you can always augment those profiles with qualitative data. One simple way to collect that data while enhancing the relationship between customers and the brand is to ask.