Blogpost (Digital Marketing)

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- The “Internet of Things” - Big Data

MKTG:1415/1427 Week 8 Presented by Torgeir Aleti

IoT Definitions • The pervasive presence of a variety of devices

- such as sensors, actuators, and mobile phones - which, through unique addressing schemes, are able to interact and cooperate with each other to reach common goals (Giusto et al., 2010).

• The billions of physical devices around the world that are now connected to the internet, collecting and sharing data (ZD Net)

• IoT encompasses everything connected to the internet, but it is increasingly being used to define objects that "talk" to each other (Wired Mag.)

Driving forces behind IoT

• Rapid fall in cost of sensors and actuators

• Increased ease of connections to these sensors

• Improved ability to access and analyse the data generated

IoT: Smart everything

https://internetofthingsagenda.techtarget.com/definition/Inter net-of-Things-IoT

A thing in the internet of things can be a person with a heart m onitor im plant, a farm anim al with a biochip transponder, an autom obile that has built-in sensors to alert the driver when tire pressure is low or any other natural or m an-m ade object that can be assigned an IP address and is able to transfer data over a network.

“Nest” • In early 2014, Google paid

US$3.2 billion for Nest. Why?

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https://www.statista.com/statistics/471264/iot-number-of- connected-devices-worldwide/

Atzori, L., Iera, A. & Morabito, G. (2010). The Internet of Things: A survey. Computer Networks, 54(15), 2787-2805.

Trackable sensors; Bluetooth vs. GPS Still in its infancy;

Bluetooth has very limited range, while GPS has very limited battery capacity. Assisted GPS; better battery but needs a SIM card.

Examples; “Nearables” by Estimote Apple’s iBeacon (since 2013).

How will marketers use the IoT?

http://blog.marketo.com/2015/04/infographic-the-marketing-power-of-the- internet-of-things-connectivity-for-better-customer-interactivity.html

Wearable technology • “electronic technologies or computers

that are incorporated into items of clothing and accessories which can comfortably be worn on the body”

Marketing implications of wearables • Smaller screens – content needs to be

modified (“glanceable”)

• SEO: Single top result rather than full page • Always connected – immediate

attention/response

• Location-specific promotion opportunities • Increased data collection (multiple devices

and data types)

• Consumer ’s armed with information • Pricing, product analysis

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Will IoT Benefit Us? • A study of 1,606 experts (PewResearch); a number of

themes emerged: 1. (+) The Internet of Things and wearable computing will

progress significantly between now and 2025 2. (-) The realities of this data-drenched world raise

substantial concerns about privacy and people’s abilities to control their own lives

3. (+) Information interfaces will advance - especially voice and touch commands

4. (-) There will be complicated, unintended consequences: ‘We will live in a world where many things won’t work and nobody will know how to fix them.’

5. (-) The unconnected and those who just don’t want to be connected may be disenfranchised

6. (+) Individuals’ and organizations’ responses to the Internet of Things will recast the relationships people have with each other and with groups of all kinds. The internet welcomes everyone and everything (literally).

http://w w w.pew internet.org /2014/05/14/internet-of-things/

Background… • Many of our daily activities are

leaving a digital “footprint”

• … a LOT of data!

Sources of Big Data • Internal • E.g. sensor data

• External • E.g. social media

• Structured data • Organised and searchable

• Unstructured data (95% of big data) • Available as audio, images, video, and

unstructured text

Gandomi, A. & Haider, M. (2015) Beyond the hype: Big data concepts, methods, and analytics Actions, International Journal of Information Management, Volume 35, Issue 2, Pages 137-144.

Eric Schmidt - ex-CEO, Google (2010)

• From dawn of civilization until 2003, humans created 5 exabytes of data • We are now creating that much

data every two days

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Definition • “Datasets whose size is beyond the ability of

typical database software tools to capture, store, manage, and analyse” (McKinsey, 2011)

• 3 V’s (Laney, 2001): • Volume • Velocity • Variety

• More V’s (Gandomi & Haider, 2015) • Veracity • Variability (and complexity) • Value

Bernard Marr (2015) “Big Data”, Wiley

Making sense of unstructured data • Big data are worthless in a vacuum

• How? • Machine learning • Rules-based • Manual Categorisation

• Who? • Service-based • Do it Yourself

Gandomi, A. & Haider, M. (2015) Beyond the hype: Big data concepts, methods, and analytics Actions, International Journal of Information Management, Volume 35, Issue 2, Pages 137-144.

Marketing challenge… • How can we convert big data into value? • Text analytics • Audio analytics • Video analytics • Social media analytics • Predictive analytics

Gandomi, A. & Haider, M. (2015) Beyond the hype: Big data concepts, methods, and analytics Actions, International Journal of Information Management, Volume 35, Issue 2, Pages 137-144.

Publicly-accessible big data • Google Trends • Google Public Data • Gapminder • ABS • Other? • Ask Bernard Marr

Some uses of big data • “Segments of one” - micromarketing: Use

data to identify very small segments • Tailor marketing mix specifically for individuals • Increases relevance of product to customers

• Unusual associations (spurious correlations) • Credit card companies found that people who

buy anti-scuff furniture pads are highly likely to make their payments.

http://harvardm agazine.com /2014/03/w hy-big-data-is-a-big-deal

Recommendation engines: Suggestions based on prior interests and comparing with millions of others

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Consumer issues… • Will big data increase marketers’

manipulation of consumers to purchase things they don’t really want? • Firms focusing on profit by capitalising on

irrational behaviour, e.g. sending an obese person a promotion for donuts

• “Filter bubble” effect • “… statistical methods write off the

outliers. But in human life it’s the outliers who make things interesting and give us inspiration.” E li Pa rise r, (2 0 1 2 ). “ T h e Filte r B u b b le : H o w th e N ew Pe rso n a lize d W e b is C h a n g in g W h at W e Re a d a n d H o w W e T h in k”, Pe n g u in B o o ks.

Rya n C a lo (2 0 1 1 ). “ T h e B o u n d a rie s o f P riva cy H a rm ”, In d ia n a Law Jo u rn a l, 8 6 (3 ) p p . 1 1 3 1 -1 1 6 2 .

If you’re not paying for it, you are not the customer, you’re the product being sold.

Had enough? Try the Google Opt-out village.