Big Data: Not Internet 3.0, Internet to the 10th Power!

[Keith Shetterly]

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Big Data is hard to think about for some, and it can seem nebulous. So, what is Big Data? It is the new business advantage!

It’s not Internet 2.5 or Internet 3.0, it is Internet[SUP]10[/SUP]! And it's going to change everything. How? These are some of the coming things possible (some already here!) for dealers to target for SALES with Big Data:

1. KNOW when your current customers are shopping elsewhere for vehicles: Customer Retention.
2. KNOW which of your Aged Internet Leads are still in-market. And what they are shopping for: Maximize Lead-Based Sales.
3. KNOW when your current customers are hitting “life-changing” (read that “vehicle-sales-making”) events such as increase in income, pregnancy, or house purchase: Life-Targeted Marketing.
4. KNOW which area to target shoppers who are NOT your customers: Conquest Sales.
5. KNOW what sources of advertising most drive your business: Advertising Sourcing.
6. KNOW what inventory is trending so that you can adjust your lot: Laser-Focused Inventory Management.
7. And more . . .

And these are some of the things possible for vendors who would like to sell to dealers:

1. KNOW which dealers you currently have who are online using search terms that apply to your business: Customer Retention.
2. KNOW which area has dealers you do NOT have signed up but are searching for your services: Conquest Sales.
3. KNOW which dealers are under-performing for their DMA (in sales, customer satisfaction, etc.) so that you can target them for help: Growth Sales.
4. And more . . .

Sound crazy? It’s not. Not at all. Big Data is coming for the car business, and it’s going to change everything.

Who knows Big Data? Do you know an application of it today in the car business? Do you see the value in it? Please comment.

Do you believe? You should!

P.S. I recommend everyone really interested in this topic to set a Google alert on "Big Data". Here's a short sample below to consider.

By Keith Shetterly, [email protected]
Copyright 2012 All Rights Reserved
www.keithshetterly.com

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-----------sample "big data" Google alert article list follows------------

hanging the World: Big Data and the Cloud The Atlantic But while two years ago, Cloud computing was appealing mainly because of its "pay per use" model (ideal in tough economic times), today, it is becoming more important because it is the enabler ofbig data analytics. As a quick review, big data is a ... See all stories on this topic »

By Decade's End, Big Data Will Be Bigger Than Ever U.S. News & World Report Information technology will be one of the fastest-growing fields this decade as commerce has gone digital in industries across the board. While the world may not see the turn-of-the century staffing crunch that was feared during the transition to Y2K ... See all stories on this topic »

The Promise of Big Data in Public Safety and Justice Government Technology The world is overwhelmed by data — and the prospects are for more than we can drink in for as far as we can see. Studies by IBM and Cisco have concluded that 90 percent of the data in the world today has been acquired in the past 18 months, and that ... See all stories on this topic » http://www.google.com/url?sa=X&q=ht...93Z4h8&usg=AFQjCNF3b8Osm8rm1ZNUPNmlX5GLC2RoUg Government Technology

LexisNexis Showcases Big Data to Contain Costs and Improve Health Care ... The Herald | HeraldOnline.com ATLANTA — LexisNexis® Risk Solutions announced today its participation in the National Health IT Week celebration (National Health IT Week) September 10-14, highlighting the use of data and analytics to drive down improper payments and ensure ... See all stories on this topic »

AppFirst DevOps Dashboard Delivers Systems, Apps, Business Metrics ... eWeek AppFirst collects millions of infrastructure, application and business metrics that are aggregated and correlated in a single big data repository. Data is collected continuously to provide customers with visibility into their entire infrastructure and ... See all stories on this topic »

HP Unveils New Enterprise Data Security Offerings eWeek With businesses using more cloud, mobile and big data strategies, perimeter-based security needs to be updated to proactive, intelligent security methods, says Hewlett-Packard. Hewlett-Packard unveiled several new data security products and services Sept. See all stories on this topic »

3M on Winning the Second Click with Big Data Appliances at BrightEdge ... Search Engine Watch On Wednesday I will be moderating a panel at BrightEdge Share 12, on the theme of a "New Direction of SEO" and will be joined by Raj Rao, VP of Global eTransformation at 3M, Leo Haryono, SEO Director at Macy's and Andy Johns, Product Manager of ... See all stories on this topic »

Group Emerges to Develop Big Data Privacy Standards Compliance Week Companies are just starting to consider how to unlock the massive potential of Big Data—the enormous and variant streams of information they are capturing, coupled with sophisticated tools to analyze them—and how to avoid the privacy and data ... See all stories on this topic »

Social/Mobile Analytics Company Kontagent Commits To Future In Toronto Via ... IT News Online The company foresees developing products that address Big Data analytics in a number of new and expanding business categories, and intends to leverage Toronto's considerable engineering talent base to help with product innovation and development. See all stories on this topic »

 

[sweece]

None of the automotive applications you discussed really sound like "big data" to me. It's a fine buzz word, but I don't think "data analysis" and "big data" should be used interchangeably. Big data refers to massive organizations (Telcom is a nice example) that have so much data (down to the minute/second) on each individual subscriber and they have to find the best way to sort that data & pivot it in order to find something worthwhile.

An automotive company selling customer specific data to another vendor isn't really big data IMHO. In some cases, that's the only data the company has, so it's not really like they have to dig to find it.

Maybe if OnStar started collecting location data on all of their subscribers and started to pinpoint likely accident points & times of accidents so that they could warn the driver ahead of time -- but do you really want OnStar to know where you are at all times of the day?

Anyhow, interesting topic.

 

[ddavis]

Keith, it's good to see you on DealerRefresh.

I totally agree with Keith, Big Data is going to be huge. It is going to dispell many common beliefs within our industry. Trust me, a lot of vendors, really don't want to hear some of the information that Big Data is providing.

Here are some excerps from a couple of articles from Dataium:


[h=1]Dataium Evaluates Efficiency of Digital Advertising Efforts[/h]First up, the company provided some data that might convince dealers to reconsider funds spent on search engine marketing.
Despite an average of 55 percent of dealerships’ online advertising budgets being devoted to paid search engine marketing, Dataium shared that just 6 percent of dealership website traffic on average is referred by paid search keywords, according to the study.
And, that’s not all: Less than 1 percent of this traffic resulted in email form leads submitted on dealership websites.
So what is driving customers to dealership sites through the big search engines?
The study found that nearly 80 percent of direct referrals from search engines during the study were driven by keywords that were a variation on the dealership name, “representing traffic a dealership would theoretically receive via high rankings in organic search results regardless of the level of paid SEM spend,” company officials reported.

[h=1]Dealers get in your Facebook[/h]The knock on Facebook, from a marketer's standpoint, is that although the huge social media site has been useful for automakers to promote brand awareness, it has been nearly irrelevant in the shopping process.
As recently as May, Dataium, a consulting company that monitors online vehicle shopping behavior, found that of 20 million visitors to dealership Web sites, just 120 arrived there directly from a Facebook link. Of that microscopic number, only a handful left contact information to become sales leads, Dataium found.
This article does talk about how Facebook would "allow dealerships to take their customer lists, with names and email addresses, and find those people on Facebook. The "custom audience" feature alows dealerships to push ads directly to Facebook users' new feeds".
This is a rather unique way of using Facebook and not convential wisdom. Based on using Facebook as a lead provider, you would be better off spending the time passing out business cards at the mall.

Dataium did a study for Cars.com that brought out a lot of the same information but I didn't see any of this on ADM or dElite. With so many pitching social media (not including review sites) and paid search, this isn't welcome information.

 

[Keith Shetterly]

None of the automotive applications you discussed really sound like "big data" to me. It's a fine buzz word, but I don't think "data analysis" and "big data" should be used interchangeably. Big data refers to massive organizations (Telcom is a nice example) that have so much data (down to the minute/second) on each individual subscriber and they have to find the best way to sort that data & pivot it in order to find something worthwhile.

An automotive company selling customer specific data to another vendor isn't really big data IMHO. In some cases, that's the only data the company has, so it's not really like they have to dig to find it.

Maybe if OnStar started collecting location data on all of their subscribers and started to pinpoint likely accident points & times of accidents so that they could warn the driver ahead of time -- but do you really want OnStar to know where you are at all times of the day?

Anyhow, interesting topic.

Limiting Big Data to things like telcom is the same error as folks who once thought .html was a pretty exercise on the descendant of ARPANET. And that became what we call now "The Internet".

Big Data, in fact, IS data analysis. From many sources, it is really "Big Analysis". For all of us, it's essentially the power to know who is shopping for what and when, and then to tie that with trending data, purchase data, historical data, and predictive data to render the best offer to a shopper possible.

Big Data is bigger than THAT, but that's a decent simplification for our industry. And I may be somewhat uniquely qualified to consider this new tool, in that I spent from 1983 to 2001 in Fortune 50 high tech, from engineering to marketing to sales. And so I see the potential for the tool of Big Data in the commercial sense, and I see the risk for the tool in the personal sense--and I do believe that, knowledge being power, then someone having great knowledge of you they might gain great power.

However, I can't stop it, and I can try and use Big Data to render the best commercial retail car-buying experience for a consumer that I can. That's my focus in all this, and I'm excited for the products I know that render a lot of help in that. Because, truth be told, if the data is there, we need to improve the buying experience for our customers using it.

Thanks!

 

[Keith Shetterly]

Thanks Doug! I agree with you. It's a game changer, and the magnitude of it is hardly grasped by even the people neck deep in it. Even Dataium, I think.

 

[Keith Shetterly]

I have a somewhat unique background for Big Data, so it's very interesting that folks actually miss that it is really "Big Data Analysis". So, I don't agree at all that it's only a buzz word, and I certainly feel I know enough about it that it's not limited to that for me.
The world is tied together with data, and we've seen even folks at the highest points in the intelligence community get caught out by the CSI ("crime-scene-investigation") efforts of folks who can tie travel data, cell tower data, credit card data, IP data, time data, etc. to render a quick analysis of who sent what "anonymous" emails.
We'll get soon to the idea that you're buying a lot of parts at the parts store, you had a wreck six months ago, and you just got a promotion. And then you go shopping online. None of that is tied together until you give up your particulars of, say, name and cell number, but eventually a CSI effort renders you as a prospect for the dealer you've bought from, or tried to buy from, before.
And that is just one CSI trail in Big Data. It's coming--in fact, Doug's point about the Dataium analysis of what online advertising spends drive what results are an interesting piece of the pie. What drives the SALES is the real tell, however, hence the report from Dataium actually "hedges the bet" about SEM/PPC. What makes traffic statistically makes more sales, but the relationship between traffic sources vs. individual sales yields a "weight" on the data. Just like Internet leads, which for years were seen as equal between sources, we know now that leads are NOT the same between sources for yield SALES. Thanks!

 

[joe.pistell]

... average of 55 percent of dealerships’ online advertising budgets being devoted to paid search engine marketing, Dataium shared that just 6 percent of dealership website traffic on average is referred by paid search keywords, according to the study....

DD, this looks wrong, so I ran the data backwards.

DATIUM

1. 55 % of dealerships’ online advertising budgets being devoted to paid search
2. 6 % of dealership website traffic on average is referred by paid search keywords

KNOWN

1. Avg PPC ad for Car dealers is $1.23

UN-KNOWN

1. #of Visitors
2. $ of Total Online Spend

Given the statement by Datium, If we fill in plug in the # of visitors & the avg $ paid per visitor, we'll see the total online spend.

# of Site Visitors	# from PPC	Avg $ P/click	Total PPC spend	TOTAL Online Spend
1,000	60	$1.23	$73.80	$134.18
2,000	120	$1.23	$147.60	$268.36
4,000	240	$1.23	$295.20	$536.73
8,000	480	$1.23	$590.40	$1,073.45
16,000	960	$1.23	$1,180.80	$2,146.91
32,000	1920	$1.23	$2,361.60	$4,293.82

Formula:

1. # of Site Visitors * 0.06 = # visits from PPC
2. # from PPC * Avg $ P/click = Total PPC spend
3. Total PPC spend / 0.55 = TOTAL Online Spend

Unless I am missing something, these #'s and $dollars$ look totally wrong to me.

If they are RIGHT, then dealers are WAYYYY underspending on TOTAL Online Spending.


Joe
p.s. The big thing about big data, it's a marketers playground. I am not passing judgement here, but, hasty analysis (or hasty assumptions) can produce poor results. Ask yourself WHO is funding or sponsoring the Big Data analysis. WE ALL ARE IN SALES AND MARKETING, I am not passing judgement.

p.p.s. Big data is so BIG... you must have lots of data and great context to create assumptions. (i.e. a Kia site is 2-400% more likely to produce a lead than a Jaguar site)

 

[Keith Shetterly]

Hi Joe!

http://dealeradvantage.cars.com/da/...thinking-Online-Media-FINAL-InsightsPiece.pdf

Yes, it is a study commissioned by Cars.com. Some thought to that is due, but it's not an indictment on the surface, at least to consider the information. I've never heard that $1.23 average known PPC click spend. Is that from your experience?

Thanks!

Keith

 

[joe.pistell]

Hi Keith...

SOMEWHERE in my travels in the last 21 days, I tripped across a Google adwords report that looked at 3-4 industries & car dealer retail was one. I know I'll run into it, when I find it I'll link to it.

 

[joe.pistell]

Keith,

Consider tripling the PPC $ and the total spend numbers are still light

# of Site Visitors	# from PPC	Avg $ P/click	Total PPC spend	TOTAL Online Spend
1,000	60	$3.50	$210.00	$381.82
2,000	120	$3.50	$420.00	$763.64
4,000	240	$3.50	$840.00	$1,527.27
8,000	480	$3.50	$1,680.00	$3,054.55
16,000	960	$3.50	$3,360.00	$6,109.09
32,000	1920	$3.50	$6,720.00	$12,218.18

Back-o-de-napkin time!
I don't have the data to back up this gut call, lets keep it loose and not get granular.

Assuming you dont have a highline or exotic store, If you have 8,000 uniques per month and your store closes between 1% to 3% of your site visitors, lets go in the middle with a sales/web visitor ratio of 2%, so 8,000 visits connects to about 160 units a month. A store that sells 160 units per month with an ad cost of $500 PVR = $80,000 monthly ad budget.

In the example above (using the inflated $3.50 CPC), a dealer with 8,000 uniques has a total online spend of $3,054. THATS NUTZ. Oppps, I mean... that's missing opportunities! The Digital spend is only 4% of the Dealers marketing campaign. That ain't right.