Determining the value of your data

John Lovett has a thoughtful post at Clickz.com summarizing many of the struggles enterprises are having with Big Data. One problem is enterprises often store as much data as possible, for as long as possible, fearing they’ll be discarding valuable information if they don’t. Enterprises struggle to understand which data-points are valuable and which ones aren’t. Lovett writes:

“Understanding what data matters to your business requires empathizing with business stakeholders, examining marketing programs, and getting to the mission-critical values of the organization. In my experience, I've found that simply asking business stakeholders what metrics or KPIs are most important to them is a futile endeavor.”

At Causata, we believe that the relative value of data should be determined by how it can be used to drive your business forward and help you achieve your goals. We begin by organizing all of the data around a customer. You should be able to see every interaction a customer has had with your company. Those interactions should be stored in time order, so you can see how events in the past, predict future behavior.

The next step is to understand your business goals. Most often these are centered on increasing profit either by selling more products and services or increasing customer satisfaction. Take reducing attrition. You’ll need to understand the behaviors that lead customers to terminate their relationship with your company. You may look at things like: How many products did a customer browse online in the past week? How many times has she called to register a complaint over the past month? When was the last time she visited a store location? Leverage as much of your data as possible, especially web and mobile data rich with customer intent. Now conduct an analysis to see how each of these behaviors is correlated with customers who end the relationship with your firm. In the process you’ve transformed your data into customer intelligence. This intelligence can be used to power campaigns to reach out to those customers most likely to attrite.

This is a tremendously valuable view of the data because it gives you the power to anticipate dissatisfied customers and reach out to them before they leave. In doing so, you’ll be able to significantly increase your business performance.

This can be extended to any business goal. In the end you’re left with thousands of data-points that express customer intent. This, in turn, can guide an assessment of the relative value of various data-points. More importantly, it can be used to help you really understand how customer behavior relates to your business performance.