Big Data’s Impact on Loyalty – An Interview with David Andreadakis, VP of Loyalty Strategy, Kobie Marketing

Mar 12, 2013

big data, loyalty, customer experienceIt’s safe to say that Big Data has long passed a tipping point. In fact, it’s estimated that the amount of total information on the internet doubles every three years. To put that in perspective, Walmart, for example, accumulates some 2.6 million gigabytes every hour from its customers.

But there’s a challenge with this data deluge: not only how to manage the information influx, but how to choose which data is important and which isn’t. Information that doesn’t promote customer loyalty can distract a brand from its ultimate goal: creating genuine, customer experience-driven relationships with customers across all channels. However, using Big Data correctly fosters brand advocacy, increased ROI and dedicated consumers – eager to spend more, telling their friends and family about their positive  customer experiences.

Kobie’s Vice President of Loyalty Strategy, David Andreadakis, recently shared his thoughts on Big Data while distinguishing loyalty-engendering tactics centered on economic and behavioral triggers.  What follows is part one of our Big Data series.

How do you define Big Data?
I don’t have my own definition but I’ve heard people use and abuse it in different ways. Big Data is data accumulated from multiple sources on a scale we’ve never seen before.  The use of “Big” is a good term, as the amount of data now has moved from where marketers were relatively comfortable with, to beyond their comfort zone.

How do you see Big Data impacting loyalty?
We tend to look at the benefits of accumulating more and more information as “what else can we learn?” The problems that come along with that are twofold, from a technical and integration standpoint, as well as “how do I mine this data?”  The first part of the problem is being solved thanks to hardware providers and big data software. The real hindrance, however, has been the inability to consume that much information. For example, if I put three movies in front of you and asked you to choose which one to watch it’s not a difficult decision. But thousands of choices are overwhelming. The key here: how do we separate what is interesting from what is useful? If marketers get a little snow blinded by interesting data, then it’s just going to interfere with already good efforts accumulating useful data. Social media, for instance, is filled with interesting information, but little useful information. Big Data matters when you can tie data back to an actual transaction or some emotional driver.

Is there any benefit of Big Data to the world of loyalty?
Yes. The above is about the dangers and what can potentially happen. But if you can be really smart about what you’re measuring and delivering, Big Data can be used to cross different channels and information in a way that doesn’t dilute a program’s original objectives. Don’t get caught up with data that says “oh look at what I found out on the way.” That’s never-ending. That’s like trying to find the end of the Internet; it’s just not going to happen.

Are there any examples you can share about Big Data and how to improve your loyalty program?
The biggest users of Big Data have always been around those with the biggest dollars, often in the financial space. Most banks have been very good at keeping Big Data for quite a while. As in all verticals, the questions we ask are: what information are you gleaning about behaviors, location and lifestyle components to help drive loyalty? And how are you pulling this together efficiently? How are you using disparate information to get at a destination? Sophisticated software is key in processing the data and an important first step.

What are your thoughts on Big Data? How can Big Data be used more effectively? And what challenges does your organization face in dialing up Big Data’s signal to noise ratio – interesting versus useful data? Share your comments below. Part II of our two-part series, economic and behavioral loyalty triggers, will be posted later this week.