Harnessing the Big Data Opportunity

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Harnessing the Big Data Opportunity

A flood of information is flowing into the world's databases.  According to one estimate, an astounding 90 percent of all the data in the world has been generated in just the past two years.

Every time we swipe a credit card, make a call, click on a link on a website, or drive through an electronic tollbooth, we are creating bits of data that are being collected and aggregated in what is called "Big Data."

For our purposes, Big Data is defined as "a quantity of digital information so vast and complex that it can't be processed by traditional database management tools."

According to by Lisa Arthur, the author of Big Data Marketing, analysts typically discuss Big Data in terms of three Vs:  volume, velocity, and variety.1, 2

  • Volume refers to how much data is collected.  According to a recent IBM report, as of 2012, 2.5 exabytes of data are created every day.  An exabyte is 1 followed by 18 zeroes.  Consider just one social media platform.  There are now 200 billion images on Facebook, and users upload the equivalent of 100 terabytes of data to the site every day.  A terabyte is 1 followed by 12 zeroes.  The Economist reports that Walmart processes 1 million customer transactions per hour and stores them in databases that contain more than 2.5 petabytes of data, or the equivalent of 167 times the information contained in all the books in the U.S. Library of Congress.3  A petabyte is 1 followed by 15 zeroes.
  • Velocity refers to how fast the data is generated.  In 2012, 2.8 zettabytes of data were generated.  A zettabyte is 1 followed by 21 zeroes.  The International Data Corporation estimates that there will be 40 zettabytes of data generated annually by 2020.  Therefore, the velocity of Big Data will increase by about 50 percent per year for the rest of this decade.

  • Variety refers to how many types of data can be accessed by marketers and other big data users.  This ranges from transaction data at the point of sale to clickstream data on websites to demographic data about customers—and new categories are being created all the time.  For example, combining data about a customer's location along with his purchasing preferences provides a valuable kind of intelligence for marketers not available until these two disparate datasets are combined...

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