Welcome to the data economy
The 2010 Kellogg Marketing Conference focuses on the keys to staying relevant: ‘Don’t just keep up, move ahead’ By Sara Langen
1/29/2010 - Human intelligence still trumps that of computers, but BusinessWeek writer Stephen Baker believes machines are getting smarter and influencing the way business is done in America.
“Data is changing our jobs and businesses, and it’s also changing our lives,” Baker said Jan. 22 in his keynote address at the 2010 Kellogg Marketing Conference. Baker, who has written for BusinessWeek for more than 20 years and is the author of the book The Numerati, was one of an array of business experts featured at the two-day conference, themed “Stay Relevant: Don’t Just Keep Up, Move Ahead.”
The first day of the two-day conference — which each year attracts hundreds of students, alumni and others eager to learn about the latest marketing trends — took place on Northwestern’s downtown campus in Wieboldt Hall, home of the Kellogg Part-Time program. The day was geared toward business practitioners and alumni, and drew 120 attendees.
Highlights of the day included MBA update lectures by Kellogg faculty members Russell Walker and Derek Rucker. Walker, senior lecturer of managerial economics and decision sciences and assistant director of the Zell Center for Risk Research, discussed customer marketing data — a firm’s “greatest corporate asset.”
Rucker, associate professor of marketing and the Richard M. Clewett research professor, highlighted the importance of “relevance through resonance” and matching marketing to motivations.
Baker’s talk addressed the conference theme — “Stay Relevant: Don’t Just Keep Up, Move Ahead.” With technology collecting new information on consumers all the time, Baker noted that the “data economy” requires diligence on the part of marketers and businesses to ensure the quality of the information is high. Otherwise, he said, one ends up with a “garbage in, garbage out” scenario that will skew the results of computer modeling.
“You have to make sure you have enough new, clean data,” he explained.
And machines are “only getting smarter” at interpreting that data, Baker added. Technology is evolving via pattern recognition and sensor programs that can determine if a change has occurred from the baseline markers. Baker highlighted an Intel study that outfits homes with sensors to record all activity. With information like that, if an elderly person were to fall and not recover, the sensors would notice the change and could alert medical care.
All this monitoring of our daily lives, whether online or in the real world, raises privacy issues, but Baker said he’s not worried about the Big Brother aspects of data gathering.
“Privacy changes,” he said. “How can we come to an agreement on privacy when people are blogging on Twitter about everything they’re doing?”
Still, Baker added that smart companies will capitalize on privacy concerns by incorporating privacy as part of how they sell their products and services.
Few companies understand data gathering better than The Nielsen Company, whose senior vice president of consumer and shopping insights, Todd Hale, addressed consumer trends in a practicum session. Buying trends show that consumers are focusing on staying in more, with both food and at-home entertainment showing growth, he said.
“Home is the ‘new normal,’” Hale explained. “People are spending more time at home.”
The new motto for shoppers has become “if you can’t eat it, you don’t need it,” he added, with personal care items and general merchandise losing ground. Private label and store brands are gaining share as consumers continue to be careful about spending, using more coupons and store circulars to save money. Shoppers are also using shopping lists for the first time in years, making fewer trips to the store and doing in-store price comparisons of merchandise on the shelf. They’re also frequenting value retailers more.
Hale gave forecasts of The Nielsen Company’s predictions for 2010, which included a marginal improvement in consumer confidence and spending, as well as a gain in jobs in the second quarter, although unemployment is expected to remain elevated for the next two to five years.