Data Analytics PPT Handout

Week 1: Analytics in the Marketing Context

3 Central Objectives of Big Data Analytics
1. Spotting patterns to help the business understand what is most important for day-to-day
operations and long-term strategy. (Descriptive)
2. Applying statistical and/or programming knowledge to convert large volumes of data into
actionable insights (Predictive)
3. Real time metrics and visualizations delivering competitively differentiating business insights
(Prescriptive)
Typically means large numbers of rows (observations – unique customers visiting amazon per
day) and columns (distinct variables – different things you can track on your consumer) in the
dataset -> STRUCTURED DATA.
To that extent your local desktop may not be enough.
Save some data (and insights) in the cloud.
Doing machine learning, AI, and statistical programming on the data to arrive at actionable
insights.
Terms “Big Data” and “Analytics” are used interchangeably.
3 Attributes of Big Data

TWO Simple Steps to Negate InfoObesity

1. Start with the business objective/pain point.
Why do we need this data? Who will use this? How? Accountability from the get-go!
 2. FOCUS your data collection effort.
Which other (old) data can be useful in this case? Who else within the firm may have this data
(even if older)? How will new data complement the old? If new data is required, how will it tie
in directly to #1?
What to do when Data conflicts with Intuition?
What Machine Learning does:
Connecting the dots -> identifying patterns -> actions
AI doesn’t say WHY the data does what it does. We need theory and intuition to understand
WHY.
If there IS discrepancy…
Try to ascertain WHY there is a discrepancy between intuition and output – “Outlier Analysis.”
In today’s marketplace, every business, regardless of its size, small or large, is deeply affected
by intense domestic and international competition.
Key Takeaways so far
“InfoObesity” and the two ways to manage it proactively:
- Start with the Why?
- How does this combine/complement with what we already know?
What to do when data conflicts with intuition?
- Question the (big) data!
- How analytics and intuition can work hand in hand
Week 2: Marketing Concepts Refresher & CBA Reading
Four Types of Customer Value
 1. Economic Value - Tangible monetary savings over products lifetime. Electric car or an
energy efficient light bulb
2. Functional Value - Features, like in mobile phones or laptops.
3. Experiential Value - Psychological and/or emotional value from owning the product.
4. Social Value - Facebook’s value proposition is from sharing/seeing pictures and videos of
friends.
Customer Value Equation
Value = Benefits / Price
GOAL: Increasing Customer Value. Value goes up without Price increasing, but for Firm bottom
line matters! Value serves as a means for differentiation.
Controllable Variables Marketing Mix- The Four P’s

PESTLE
Political, Economic, Social, Technological, Legal, Environmental
ECONOMIC: Ongoing Problem with RMB
Undervalued Chinese currency. By buying US currency and treasury notes on the open market,
China keeps demand for the US dollar high. They can afford to buy and hold so much US
currency due to their huge trade surplus with America, and they buy US currency roughly equal
to this surplus.
Social
Global Marketers must understand what is acceptable Socially in a culture. Culture & Social
norms are pervasive in all marketing activities – in pricing, product, packaging, and styling. Size
of package depends on affordability – single use shampoos in Asia. Colors used depend on
cultural cues – red for luck, joy in China, green – new beginnings (harvest time)
Technological
What devices are available in the target country? iPad proliferation rate? Smartphone access?
How accessible/reliable is the internet? Looking forward: What technological advancements are
on the horizon? How will they affect our operations?
Legal
Bribery implications – Corruption Indices across countries
Selling Customer Data – Data. Protection Issues [CCPA and GDPR]
Copyright Infringement
Environmental
Timberland announced it would plant 50 million trees. In line with its long-term sustainability
strategy. Timberland has 90% brand awareness in Europe as a sustainable brand already and
this will improve their brand awareness.
Patagonia’s “Experiment in responsible business” - In 2019 they donated 10 million on top of
their 1% based on savings from corporate tax cuts!
Week 4: Predictive Analytics, ML/AI, Data Strategy
Exploratory Modeling

Used to understand characteristics of subjects based on historic transaction and demographic

data. Used as a precursor to Predictive Modeling.
Predictive Analysis
Predictive, which answers the question, “What might happen in the future?” Once a model is
created that fits past data well, we can use it to predict what may happen in the future, given
no major changes in assumptions or relationships. The forecasting piece in Tableau is an
example of predictive analytics.

How it works with say, 1,000,000 rows of data. The first 750,000 rows are the inputs: We use it
to understand relationships between variables, increase R square etc. Exploratory modeling 
Training model. Next 250,000 rows are holdout: We use it to predict Y and compare with
KNOWN Y. Try to minimize gap between prediction and actual – minimize “error”. Row 100,001
is NEW data which you can then run your model on and obtain predictions for UNKNOWN Y
Factors that affect Defense/Offense Split Ratio
1. Regulatory environment - Insurance and financial services, healthcare companies
typically operate in heavily regulated environments  an emphasis on data defense.
Retailers, operating in a less-regulated environment where intense competition requires
robust customer analytics -> might emphasize offense.
2. Company’s overall priority - Do we want to “control” (security, integrity, governance)
versus “flexibility” (improve competitive position and profitability)
Timeline: Data defense is day-to-day operational -> master data management,
information security etc. Data offense involves partnering with business leaders on
strategic initiatives.
3. Data capabilities of competitors - Do we want to do the same or different?
4. Maturity of own data-management practices - aspirational or transformed?
Dynamic decision: Data strategy needs to dynamically adjust as competitive pressures and
overall corporate strategy shifts.
What is AI?
Leveraging computers and large datasets to mimic the problem-solving and decision-making
capabilities of the human mind. With the human mind, there are inbuilt biases.
Both AI and ML can be used in Predictive Analytics - From Data Preparation i.e., data cleaning,
feature engineering, to Model Building i.e., Algorithm selection.
Invisible is as important as the Visible
Data culture encompasses (1) values, behaviors, and attitudes of executives and employees (2)
that promote and enable use of relevant data as the driving force of decision making.
How Well Does Your Company Use Analytics?
Integrates findings across all readings.
Surveyed more than 300 senior executives about the level of “data-driven decision making
(DDDM)” in their organizations and their performance on seven dimensions of “analytics
readiness (AR)”. Based on these findings we developed a diagnostic tool to: (a) help assess
where a company’s starting point is [‘one size does not fill all’ when it comes to analytics
transformation] and (b) enable it to move along the continuum.