Target and Big Data
When thinking about big data, the bridge between IT and business (McVey, 2013), and how big companies make use of customers’ information to predict and influence their future purchase activities (Siegel, 2013), one example that comes to mind is Target.
Target wanted to establish themselves as the one stop shop for families, but they noticed it was really hard to change people’s habits once they get used to buying cleaning products at target and everything else at a supermarket or grocery shop. So they decided they needed to target consumers at a vulnerable time of their lives, meaning new parents. They realized new parents didn’t have enough time to go to so many different shops, and that if they wanted to acquire long term loyal customers, they’d have to target those new growing families (Duhigg, 2012).
One of their best statisticians, after months of analysing data, came up with a list of products that early expectant mothers would buy. Things like vitamins supplements, cotton balls and body lotion were on the list, and it proved to be over 80% accurate (Duhigg, 2012). Once such products were sold, shoppers information was retrieved either through their credit cards or through having them sign up for a coupon promotional campaign, where Target would mail customers with a list of discounted products to get them to come back (Golgowski, 2012).
Everything was going well until one day when a middle aged man walked up to a Target store and asked to speak to management. He was rather annoyed about the coupons his fifteen year old daughter had gotten in the mail; Nappies, infant milk products, trolleys, expecting mother fashion items, and other such products were being explicitly advertised to a young girl. The manager apologised, insisted there must have been a mistake and a few days after the incident, called the father again to once more apologise. But this time the father was the one who apologised, saying he had just been informed his teenage daughter was in fact pregnant (Golowski, 2012).
This is one very interesting example of just how powerful big data really is. Activities and behaviours that might seem random can be analysed and used to find out some very personal information. After that incident, Target decided to change their strategy a little, seen that not everyone will be happy to know a company that big has access to such private information not everyone might like to share. What Target chose to do to address this problem is to include some random products such as lawn mowers and building tools in the coupon list, so the nappies and baby bottles will look just as random (Duhigg, 2012).
Big data allows companies to find out a lot more information than we think we put out, and companies have ways of using that information without being too obvious, while providing us with what we want and need before we even know those wants and needs actually exist. I believe the fact that the information is out there is not necessarily bad, but what can be bad is the lack of control we have over our own information and what others may use it for.
Bibliography:
Duhigg, C. (2012). How Companies Learn our Secrets. Retrieved from: http://www.nytimes.com/2012/02/19/magazine/shopping-habits.html?pagewanted=all&_r=0
Golgowski, N. (2012). How Target Knows When its Shoppers are Pregnant – and Figured out a Teen was Before her Father Did. Retrieved from: http://www.dailymail.co.uk/news/article-2102859/How-Target-knows-shoppers-pregnant--figured-teen-father-did.html
McVey, I. (2013). What Is Big Data?. [video] Available at:https://www.youtube.com/watch?v=9cRAdB9eriY
Siegel, E. (2013). Predictive analytics. 1st ed. Hoboken, N.J.: Wiley, pp.1-16.