Big Data Yielding Big Results Through Small Details – And What That Means For Customer Loyalty

Aug 18, 2012

When writing a blog post about Big Data and its customer loyalty potential, it helps to frame the conversation with some big numbers first.

For starters, Big Data isn’t just Big. It’s really B-I-G! According to IBM, some 2.5 quintillion bytes (a ridiculously long number with 18 zeros in tow) of data are generated every day – so much so, that the computer giant estimates that 90% of all the data in the world today was created in the last two years. That includes everything from your last Facebook posts and Twitter blasts to radar returns from the tropical Atlantic, GPS navigation to a slew of classified military intelligence.

Big Data, like the terms Big Bang, Big Oil and the Big Three (automakers), evokes a hard-to-get-your-brain-around-it neural-chemical logjam. Even with the gigabyte perspective above, what does it really mean when companies like Kurtosys, a financial sector digital technology provider, for instance, writes on their own blog that there are nearly as many bytes in the digital universe as there are stars in the actual universe?

Big Data must be about gathering details about product and brand preference – whether you prefer Boar’s Head Bologna to Oscar Mayer – for it to make any sense. In other words the more granular the consumer picture that comes forth, the more individualized a loyalty program can become.

That’s why a pilot program at a Denver, Colorado Safeway was so intriguing. Launched earlier this summer, the supermarket began offering custom pricing to members of its loyalty program. Kroger, too, according to the New York Times article, is joining the personalized pricing party, basing prices off the items people typically buy, and expanding price point sensitivity to include knowledge like: income, family size and frequency of purchase. While stories like this necessarily generate privacy concerns along with potential fairness and truth in advertising pitfalls, it’s our opinion that many will overlook those fears and foibles in return for the value that they receive from their loyalty program, especially as program longevity demonstrates that their personal data is being used for the right reasons and not distributed to third parties.

Just a few short smartphone-less years ago, capturing this data (let alone acting on it) in a reasonable timeframe and using it to tailor a loyalty program would have been impossible. Not just “unlikely.” Unheard of. At most, loyalty providers could break down their existing data, garnered through intrusive phone calls and (even more intrusive) in-store surveys, into Nielsen-like categories: gender, age, and typical purchases. The real-time aspect of smartphone-based data collection was similarly impossible.

As is often the case with big ideas and big concepts, it helps to see its use in practice and not just compared to the number of football fields something can fit in or is equal to in volume. And the Safeway example does just that. Ultimately the success (or failure) of Safeway’s pilot program will be deduced from the number of Safeways and other retailers that choose to adopt similar pricing structures.

Regardless, Big Data, like the stars, isn’t going anywhere any time soon. Less than a decade into the modern mobile age, the data parade is just kicking off so loyalty providers still have plenty of time to act.

Consider that a Big Relief!


Once you have your data, it’s important to know how to protect it. Read our insights about data privacy here.