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How the Average Consumer's Use of Analytics Will Change Your Work

by Dave Hannon

October 18, 2011

By Dave Hannon


The more I learn about data and analytics, the more I believe there will be broad applications for data and analytics well beyond the business world. They aren't blatantly obvious right now, but if you look for them, there are some signs that the average consumer is subtly being exposed to more analytics -- even some predictive analytics -- everywhere they turn. And this trend may will impact your IT organization in the near future.

You could make the argument that we have USA Today to thank for this trend. For years, the newspaper has been using infographics to effectively display information which has been subtly introducing the average American to analytics. Putting simple pie charts and bar charts in front of the American public every morning must have had some familiarization effect on the general public, right?

Certainly, the world of politics has been keen on analyzing data for a long time. An exit poll is basically a very low-level use of predictive analytics, right? And who hasn't spent election night watching the news stations slice and dice voter populations and districts and then -- with all due respect to the late great Tim Russert's chalkboard -- present possible outcomes on big digtial screens. "If the sixth district votes for this candidate, then the entire state will go that way..." U.S. voter, you've just been given a brief tutorial on predictive analytics. (As an aside, here's an interesting article about how one of the presidential campaigns is using analytics in its work).

Even dashboards -- I mean the actual dashboard in your car -- are exposing the general public to more analytics. I've got a gauge that tells me my real-time gas mileage, and I'm taking action based on that data. Other cars indicate when you will need your next oil change, provide real-time data on the strength of your headlights, and more. It's not a user viewing and analyzing data, but it's another way the general public is getting used to leveraging information to make future decisions.

In fact, a car's ability to help its driver conserve fuel with real-time data is perhaps the best indication of where analytics will take the general public next. Imagine that same scenario playing out in every home. A "dashboard" on the living room wall that indicates how much home heating oil you're burning through at any given moment (and if you've seen projections for home heating oil prices -- again, predictive analytics at work -- you know this would be a helpful feature).

Beyond simply displaying data in dashboards, the average consumer is also becoming more accustomed to the use of alerts as a way of interacting with predictive analytics. Just this week it was announced that wireless carriers will alert cell phone users when they may go over their allotted minutes. Alerts based on data, just like a business may have coming in to warn of delivery delays or past-due invoices, are now going out to 300 million cell phone user in the U.S. 

So how do these co nsumer or "general public" trends impact you, the IT professionals and advanced analytics users of the world? Well, it's important because all of these trends are impacting your customers -- both your internal customers and your actual external customers. And as those customers become more comfortable with data and analytics in their consumer lives, they will start expecting it from their business partners. So instead of simply using analytics internally to improve your own business you might have to provide analytics as a service to your customers.

For example, if you're an energy provider, your customers are going to expect you provide that dashboard on the wall telling them how much oil they're burning. If you're a retail chain, they may want an app from you that lets them analyze product specs and prices across geographies and brands. If you're an equipment maker, your customers may expect service alerts to help them automate preventive maintenance on your products. Travel service providers are already providing alerts when prices on certain flights drop (DING!). (In fact, if you can believe it, the increased adoption of analytics has even impacted how I create and post this blog.)

If you're a savvy IT organization at a large enterprise, you might be thinking of this already. I suspect the biggest challenge may be for companies with less experience in building customer-facing software. Sure you might have advanced analytics for your internal users, but where do you get the technology and strategy to roll out similar features to your external customer base?

This recent SAPinsider story called the OEM Primer provid es examples of companies that have embedded SAP functionality into their own product and service offerings to provide some analytic capability to their customers. It's one option to help you get those analytics out to your customers without investing in an entirely new team.

If you've got other ideas, examples, or suggestions of how the growing consumer acceptance of analytics is impacting your business, I'd love to hear them.


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