In all the excitement over big data, it’s easy to forget the consumer.  They are, after all, the ones impacted by analytics that uncover patterns in consumer purchasing behavior, create algorithms for product recommendations and determine the best marketing methods.  And it is the consumer that must provide all of those data points.

In today’s current set up, most consumers providing this data aren’t aware of how much information their online purchases, GPS trails and social media mentions contribute to certain big data trends, but as advertising, retail and brand relationships become more centered around personalization, the consumer will be faced with the undeniable fact that their data exhaust is being greedily sucked up by corporate entities that run the gamut.

Only then will the consumer recognize their own power in this big data story, taking back control over what data is provided to what company, when, where and why.  It’s a detailed future outlined in a recent Wall Street Journal article, where MetraTech CEO Scott Swartz offers a decidedly different perspective on big data trends today.

“…big business thinks that the best way to get personal with customers on the Internet is with ‘big data,’ gathered by placing tracking files in people’s browsers and smartphone apps without their knowledge—so they can be stalked wherever they go, with their ‘experiences’ on commercial websites ‘personalized’ for them,” Swartz says.

“It is not yet clear to the perpetrators of this practice that it is actually insane. Think about it. Nobody from a store on Main Street would follow you around with a hand in your pocket and tell you ‘I’m only doing this so I can give you a better shopping experience.'”

See the entire CEO Series with Kristen Nicole on Pinterest and Springpad!

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I’ve yet to find someone that speaks so candidly as Swartz about big data’s impact on the consumer, and his point of view is rather refreshing where access, security and management are concerned.  Swartz has a unique vantage point as MetraTech’s CEO, providing analytics tools around transactional data.   Key to MetraTech’s product is the association of metadata to consumer purchases. (A vote with your wallet, Swartz calls it.) There’s a great deal of business-to-business interaction involved as well, MetraTech being  an agnostic platform for running analytics.

In today’s CEO Series we hear more from Swartz on the topic of big data and its collection, as well as the very important distinction between data’s contribution to your knowledge base and actually making the right decision.  He also details how consumers will reshape the commerce of data, dictating its path towards understanding our nature.

What’s important to note in this interview is Swartz ideas on the methods businesses should be using, and his realistic vision of how consumers will adapt to this inevitable deluge of self-quantified data.

You recently cited a report by Aberdeen that found most companies value transactional data above other data sets. Why do you think so many people were surprised by this finding, and where do big data processes fit in?

When people think big data, they think about the three V’s: volume, velocity or variety. Transactional business data doesn’t meet any of those criteria. It can be argued that some transactional systems such as stock exchanges meet the volume or velocity criteria, but they are the exception. People were surprised to learn that transactional data, which is comparatively small and growing at a sleepy 36 percent per year (Aberdeen), was at the core of the of the big data initiatives. This initially seems counter intuitive, but when you think about it, it makes sense because transactional data includes purchases (a vote with one’s wallet), inventory and other tangible business metrics.

Big data is being used to add color to and provide new insight into the transactional data. In most business contexts, the primary purpose of big data initiatives is to gain knowledge and take action to drive more transactions or new types of transactions.

Is there a natural limit to the type or amount of context you can aggregate around transactional data?

Yes. The only limitation is the ability to tie non-transactional activity to a uniquely identifiable user. For example, if you do some research on Amazon before making a purchase (a transaction), they will know which other products you looked at, how long you looked, how many reviews you read, etc. Big data enables you to aggregate that data if your research spanned a single session or many sessions over the course of months.

However, if you don’t log in and you’re using a device that Amazon can’t tie to your account, there is no way to associate that sub-transactional data with the transactional data. The company might try to tie IP addresses together, but that’s not reliable because you might be at a hot spot or at work on your mobile phone, or it might be another family member using a shared iPad or computer. The data is still useful for gaining insight, but it can’t be directly tied to the transactional data.

You’ve pointed out an important distinction between access to data and the actions a business subsequently takes based on that data. Just because you have the knowledge, doesn’t mean you make the right decision. How can C-level executives and others better leverage data alongside their decision-making processes?

No technology is going to remove business intuition. Gartner states that more than 85 percent of Fortune 500 organizations will fail to effectively exploit big data for competitive advantage through 2015, and McKinsey states that there is a shortage of 180,000 managers and analysts with the skills to understand and make decisions based on the analysis of big data. Executives need the infrastructure and culture that enables them to quickly trial and measure the results of their decisions. They also need to realize that it’s an iterative process, and along the way they will make mistakes and likely find data that is contrary to their existing business models.

One of the most interesting things I’ve discussed with you is the idea that businesses using transactional and other consumer data will need to create profiles around our varied individual interests to fully understand the population as well as the person. Where does MetraTech fit into this future scenario?

MetraTech enables companies to monetize their business through agreements-based billing and settlement. From a billing perspective, they can create offerings and bundles that are specifically tailored for an unlimited number of micro segments or individual profiles (business traveler, football fanatic, avid gamer, etc.). From a settlement perspective, they can onboard an unlimited number of suppliers that provide compelling, profile-specific content. In addition, we calculate compensation for distribution partners, many of whom have built loyal communities directly tied to the targeted profiles. MetraTech can manage these types of sophisticated multi-party agreements that span customers, profiles, suppliers and distribution partners.

SCOTT SWARTZ

DATA ADVOCATE

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