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DATA DETECTIVES

Why Most Data Is Drivel

To truly understand your customers, you need to get an up-close-and-personal view of their experience that Big Data just can't deliver.

The average Inc. reader is positively drowning in data. I know I am. I have access to more mounds of data about the purchase patterns of prospective clients than there are stars in the night sky. But having access to that data doesn't mean I'm any closer to understanding exactly what makes my prospects tick, or why they might choose a competitor's firm over mine. In fact, sometimes I worry that all these numbers might be guiding me further away from the human beings I am trying to understand.

On the plus side of the ledger, I know I'm not alone. In a recent IBM Global Consulting survey of some 1,700 chief marketing officers representing 16 industries, respondents said data is as much of a hindrance as a help.

I've heard this same lament time and again. In fact, I recently spoke to one automotive executive who said, "It's not that there isn't good data. It's that we can't use it. We don't have the time to drill down deep enough to find the nuggets of gold. There's just not enough time in the day."

IBM experts echoed those sentiments, adding, "Managing the data explosion is the top concern of CMOs worldwide, and many struggle to develop customer insights because they primarily focus on understanding markets rather than individuals."

To which I say, "Amen." I would even go one step further: Understanding individuals, without considering the relationships that guide and inform them, is dangerous too. Your campaign won't succeed if it's based on connecting with a vague target demographic or psychographic your research company created for you (e.g. "Our buyer is named Tad. He's 29, an early adopter, and seen as a bit arrogant by his friends.").

Real insights are gleaned by taking that broad, amorphous, and oft-times patronizing target demographic, rolling up your sleeves, and finding out if Tad really is who the researchers say he is. You might find Tad isn't your actual target demographic in the first place. He may be only one of 34 potential types of buyers. And, who knows, he could end up being a real sweetheart as well. It's your job as the entrepreneur to have firsthand knowledge of the human beings who buy your product or service.

Asking the 'Why' Question

I'm not saying that data can't be useful. But Big Data is limited because it doesn't dive deep enough to ask the 'why' question. Typically research will probe audiences to answer the who, what, when, where, and how questions, but they rarely ask why because it requires more than a yes-or-no answer and can't usually be found by analyzing behavior that can be quantified.

Here's another sobering thought: Eighty percent or more of the IBM respondents still focus primarily on traditional sources of data such as market research, competitive benchmarking, and, gasp, sales campaign analysis to make strategic decisions. That's akin to staying mired in the bunker directing nonexistent forces to battle a foe you neither understand nor can locate. I'd call that a losing proposition.

Hit the Road, Jack

One key solution to the "drowning in data" dilemma is vital, but it requires good old-fashioned detective work and pounding the pavement yourself. Kraft Foods is a great example. The brand had been struggling for years to take a bigger bite out of the vast consumer pocketbook. Finally, some enterprising Kraft executives handed in their suits and visited the supermarket aisles as average shoppers would and began listening to and engaging with living, breathing human beings.

They quickly struck gold (or cream, if you prefer) with their Oreo brand. They made their cookies smaller and less sweet. Sales skyrocketed by more than 80 percent, and in-store sales in some regions more than tripled. All because they tossed out the data and asked consumers the why questions: ("Why don't you buy more of our cookies?" "Why would you like them to be smaller?" "Why would you like them to be less sweet-tasting?").

Where are Decisions Made?

Here's another example. A huge consulting company told us they were investing significantly in their social media presence because that's where they connect with recruits.

We respectfully disagreed that they were recruiting the way candidates wanted to be reached and received permission to travel alongside a set of college seniors as they decided which entry-level offer they would consider. Long story made short, the company's online profiles turned out to be the final checkpoint in a student's decision-making journey--useful, but only when they were asking some final questions to make their decision.

Instead, newly-minted graduates sought qualitative information gleaned from trusted sources such as Glassdoor, top industry bloggers, and industry trades. All three, by the way, raised significant questions about the work-life balance our client could offer. That is a big deal to Millennials who, while success-driven, also want to continue training to compete in a triathlon, read a book a week, or donate 20 hours a month to charity.

So by putting ourselves in our client's audiences' shoes and experiencing their wants and needs from the outside-in, we were able to advocate the company select young, fast-track role model employees who were living a balanced life. Those employees could interact with the Doubting Thomases where those conversations were happening, as well as tell stories about their work life outside of the company's platforms.

We still advocated they keep the priority on their own social media platforms, but they went forward with a much better understanding of how and why someone would want to interact elsewhere--and the 95 pecent of the decision-making process they were missing.

The chief marketing officer of that firm will tell you we saved him a $1 million investment in a new website by persuading him to ignore his data--because the data gathered was only responding to the questions it was being asked.

You Help Me Be My Best

A top-of-the-line chain of fitness studios fielded research that supported what they suspected: Well-heeled clients paid a rather pricey annual membership because they respected the advanced academic degrees possessed by the trainers and felt they were being given the most advanced advice possible.

We questioned that data and asked if we could experience the gym from a client's perspective. So our team slipped into our sneakers and sweats and worked out for a full hour with each of these trainers.

We also interviewed the trainers one-on-one, as well as other clients who were working out alongside us. We uncovered an insight the data had missed completely: While the trainers' pedigrees were influential in helping attract clients, what kept clients coming back year after year was the trainers' ability to alter the regimen as the mostly middle-aged clientele aged.

"These are the only trainers I've ever known who carefully examine my complete wellness profile, understand what's changing physically, mentally, and spiritually in my life, and alter their training workouts for me accordingly," a 71-year-old client told me. "They've helped me be my best at 51, 61, and now, at 71." That single septuagenarian provided the insight needed to drive our entire campaign: "Making you the very best you can be at whatever age you are."

The Longest Journey

The approach I'm suggesting is the one less traveled for a very obvious reason: It's tough as hell and requires a lot of man-hours. It also requires the ability to spot an important piece of information in real-time, and probe even more to understand its core essence.

By putting ourselves in our clients' audiences' shoes and experiencing the company from the outside in, we've brought subtle, but critically important, insights that mounds and mounds of raw data simply can't provide.

So if I were in your shoes, reading this column, I'd push back from my desk and slip into a pair of whatever footwear your customer or prospect prefers, whether that customer is an Inc. 500 CFO, a small-town insurance agent, or a divorced mother of two. Until you take the time to personally live your customer's life and understand how your product or service fits in, you'll be forever drowning in a sea of data.

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IMAGE: Corbis
Last updated: May 19, 2014

STEVE CODY | Columnist

I'm a climber, comedian, and dog lover. But not necessarily in that order. I also happen to be co-founder and CEO of Peppercomm, a strategic communications firm headquartered in NYC, with offices in San Francisco and London. I publish RepMan, a daily blog, and have had the opportunity to appear on CNBC, MSNBC, NPR, and a host of other top-tier media over the years. scody@peppercomm.com

The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.



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