Will vast quantities of social media data transform business success from an art form into a science?
“Half the money I spend on advertising is wasted, the trouble is I don’t know which half,” is a great quote has been used to define the challenges of marketing.
Coined by John Wanamaker back in the 1920s, it held true for around 100 years. But many are beginning to challenge its central premise. The rise of disciplines such analytics and innovations like ad networks and search are playing a fundamental role.
But some believe that the value of all this data will go well beyond getting a better ROI on advertising budgets. It could make commerce more predictable as a whole.
Attend any Chamber of Commerce cheese and wine, and you will hear other standard business clichés. “The harder you work, the luckier you get,” is one that also confirms that business is still considered more of an art than a science.
There are just too many variables in terms of services, heritage, products, target audiences, staffing, funding and competitors to create a set of simple common principles.
Or are there? I picked up a great book at the recent London Digital Forum, edited by Dr Michael Wu, who rejoices in the title of Chief Thinker and Principal Scientist at social media technology firm Lithium.
In the publication he argues: “Social media, together with modern computing technology, has made possible the collection and analysis of vast quantities of data. This has given us access to information about human behaviour – one of the most fascinating and complex subjects in the universe – that we have simply never had before.
“Together with recent breakthroughs in statistics and machine learning, we are now able to discover and tease genuine principles in business, and to quantify how repeatable and reliable they are.”
In other words, according to Wu, it might soon be possible to create a set of formulae to guarantee business success, akin to the four equations used to explain all the electrical and magnetic phenomena in nature, from lightning to auroras.
But in the meantime it is possible to apply this approach to e-commerce now. That is why we have devoted much of the latest issue of The Drum to analytics. It looks like what was once considered an esoteric discipline really has the power to enlighten us all.
Subscribers can download a copy of The Drum’s analytics supplement here.
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