The modern American economy is driven by data. It determines the places where we shop, the products that we buy, the manner in which we buy them, and the way in which we express our reactions to these purchases. Due to data-driven services like Twitter and Foursquare, our every thought and perception is documented.
Ninety percent of the world’s existing data has been created in the last two years alone, an astonishing fact considering that the Internet has been in existence for about 30 years. From 2006 to 2011, the amount of online data increased by a factor of nine, to almost 2 trillion zetabytes. On average, we create 2.5 quintillion bytes of data each and every day. Cisco has predicted that, by the end of this year, the amount of globally shared digital data will exceed 667 exabytes annually. To put that number in perspective, it’s about 2.6 million times the amount of info stored by the Library of Congress. In a 2003 study, the University of California-Berkley estimated that, at the time, every word ever spoken by the human race could be stored in text form in roughly 5 exabytes of data. As each zetabyte is equivalent to 1,000 exabytes, it stands to reason that the amount of data shared up to 2011 equates to about 400 million times the amount of data ever spoken by humans.
This is big data.
While many have appropriated the term “big data” to simply relate to the increasing preponderance of data-related analytics, such as discovering the number of people using a certain hashtag on Twitter or aggregating data from a poll regarding website design, the reality is much simpler.
In its purest sense, “big data” refers to the inconceivably large amount of data that is currently available.
The benefits for businesses that choose to take advantage of this are countless. First and foremost, big data provides a much more accurate way of analyzing business operations. Instead of simply checking how often their name appears on Twitter or how many people subscribe to their newsletter, a company can theoretically analyze every single factor of their business, from hot sales locations to the number of sick days employees average in regional offices and the company’s rate of growth over the past decade.
The ability to analyze and understand every single facet of a company or customer base is where the true value of big data lies. The sophisticated analytical boost provided by this resource can allow businesses to make well-informed decisions regarding company policy.
In addition, today’s data-rich market allows companies to structure a far more involved experience for their customers. The ability to aggregate enormous amounts of data allows a company not only to present a product that meets all customer expectations, but also to continually develop and improve this product following its initial release, given the prevalence of user-generated data that could be available regarding it.
The sheer volume of data available presents an incredible array of opportunities for businesses, particularly in terms of marketing. The ability to analyze every factor pertinent to a business’ success allows companies to tailor their products and services like never before. With the rate at which big data is growing, its applications for business use should see a similar uptick, allowing for the growth of entirely new and revolutionary business strategies.
[Sources: IBM, McKinsey]