Podcast: Why Big Data Matters to Businesses

big data

 

With so much talk about Big Data and the new waves of marketing in the Digital Age, there’s been a lot of discussion on how to use data to benefit various industries

Big Data can provide insights a consumer’s wants and needs and provide a roadmap for how you can get in front of new and returning customers. We sat down with PIN Business Network’s CEO, Joe Oltmann, and President, Keith Sawarynksi to discuss how they use data to their clients’ advantage.

Announcer: Coming to you from the Denver Tech Center in Denver, Colorado. This is PIN Business with Laura Cromwell.

Laura: Hey, everyone, it’s Laura at PIN Business Network, we’ve got our CEO, Joe Oltmann, and president, Keith Sawarynski here to talk about how data can be used to benefit businesses and better segment their audiences. Guys, thanks for being here. Let’s start it off. How did you get into data, Joe?

Joe: Well, that’s kind of a loaded question. So we started the company seven years ago. It’s a result of sitting in a bar drinking beer with my buddies. I’m talking about a problem that existed in the marketplace. So I built a model and on a cocktail napkin. So that’s how it started. And we’ve had probably two or three different pivot points over the last seven years that have got us to where we are today. But we became data curious about four or five years ago and just wanted to study how Facebook, Google, and other data aggregators were creating success for businesses, and we wanted to capitalize on that for everything from small and small to medium businesses all the way up to enterprise clients.

Laura: Keith, you want to add anything?

Keith: Well, I think, you know, when you’re talking about marketing, you’re talking about data. The fundamental questions are always the same. They’ve always been saying, you know, how do you generate more sales? How do you generate more efficient messaging? How do you generate faster time for conversion? So the old adage is about it’s easier to keep a customer than instead to earn a customer.

Keith: And I think when you start to dissect what information is actually available to you and you start to ask questions about what’s coming back, you realize that there’s a lot of holes, there’s a lot of unknowns in what you’re provided from an insider reporting standpoint. So anybody that has experience with, you know, Google Analytics or Facebook Insights, you recognize that there’s something valuable in what they’re presenting you. But you also recognize very quickly that the terminology that you’re using, the structure in which is presented to you, is always going to favor the platform that you’re getting those reports from. And so if you start to ask questions about what you’re looking at and what you’re missing, then you realize that there are places where you can create answers. If you start to combine information from a variety of different sources. And so I think one of the things that we do here pretty well is we don’t take verbatim what we’re told from, you know, from platforms from the DSP or from Google or from Facebook or LinkedIn or YouTube or whatever it is. What we do is we take what they give us and then we ask what’s missing.

And then we search relentlessly to try and find those missing pieces because that’s where you can actually create efficiencies. That’s where you can actually create output for clients in and for ourselves. And so the journey is actually quite enjoyable because basically what you find yourself doing on a daily basis is just asking questions. How is that possible? How can I get that answer? How can I find out that that piece of information? And then when you find it and you relay it to a client or you relay it internally to groups here at the company, the output from it is it’s quite amazing to watch. And what’s possible, too, for you to create or for us to create for ourselves and for our clients. I don’t think you see in many other advertising agencies or traditional marketing companies or creative agencies because we have access to so much more information. I think that’s one of the things that I think drives this company moving forward is we’re very, very inquisitive and we never take at face value what we’re told.

Laura: So I think we all remember Mark Zuckerberg getting skewered by Congress over Cambridge Analytica. So the conversation on apps and websites selling user data has made the public realize just how much information about them is available to companies and the government. So how are we working around that with all the regulations being tightened up?

Joe: You want me to take that? Well, I actually don’t think that the regulations have been tightened up. I mean, you have Google that’s using a device to listen to conversations and decipher those conversations. You have Amazon doing the same thing. I think one of the issues that we have is we have a very uninformed Congress. Number one. So they don’t understand technology. And, you know, a lot of the bigger players in the game right now, Amazon, Google, Facebook, they take advantage of that ignorance. And so, you know, data, as it sits right now on these different platforms, is available to only those platforms. So by tightening up regulations, we’re not going to tighten up regulations on Google. We’re just gonna make a more difficult, more expensive for people to actually advertise their products or services and marketplace. So it favors the big companies. So now how we’re getting around it. First of all, we have our own tech, right? So we build de-mask IP addresses, develop personas, quality scores, relevancy factors. We correlate data, then we make decisions on what platform we actually put a customer, a message in front of a customer, to get them to convert. So all that information is really important. But I think that what we’re hearing about with Zuckerberg being skewered is, you know, it’s a direct reaction to an unfavorable outcome to a certain portion of this country who wanted the outcome of that election to go differently. And Cambridge Analytica, unfortunately, if you want my opinion became the fall guy for that, that undesirable result for that portion of the country. I don’t believe anybody broke any laws by data is available. And then, in fact, we can gather data every single day on individuals. And there’s nothing illegal about it. And frankly, I think that if we start talking about, you know, the ethical standards of these environments, we’ll find ourselves in a more slippery slope, because then the only people that will have access to this information are the people that actually own these platforms. And I think that’s dangerous because it will end up shutting out the smaller businesses and strengthen these bigger behemoth companies at the expense of the general public.

Keith: Yeah, I would just add that I think the uninformed part I think is right. And as a user, as somebody who I buy things, I mean, people show up. You get advertised to all the time. You have to remember that there’s certain bits of data that you have that you want to protect. Like your Social Security number, your credit card information, your bank accounts, those types of things.

Joe: Your birthday. As you get older. I don’t really want that birthday anymore, please don’t remind me of that.

Keith: You know, people talk about I need to protect my, you know, my personal information, my address and think that either your address is publicly available. If you own a house, if you own property, your address is publicly available. So the thing like your e-mails where people have multiple emails and I have one that I use personally, I have business e-mails and then I have the one that I use from a spam standpoint that were I to fill out some sort of form, that’s the one I would use. And I never checked it. There’s probably 100 million emails in there that I never touch. But the point of what I’m saying is I’m generally providing affirmative consent because I’m engaging. And so there are certain things you want to protect. But I think when we use a blanket term like, you know, Facebook selling my data, you know, Google sells your data technically. They sell access to you as you browse the Internet in an audience and advertisers buy it. And there’s a there’s something to be said about, you know, what Joe is just talking about in terms of part of that. You don’t ever want to go away. Think about some of the things that you have today that are valuable to you because you were introduced to it through marketing and advertising and sharing messages. And companies do not require that you actually have to act on it. And so I think there’s this I would sort of describe it like victim mentality is maybe too harsh. But the idea that you’re not in control of the action that you take when someone puts a message in front of you. An innocuous marketing message about a product. You know, True Green or bug repellents or insulation or someone walking by my house and knocking on the door and wanting to share the Lord’s work. Those things happen. And generally, when we’re talking about people-to-people interactions, most of the time people don’t get upset. Like, no, thank you. The same thing is true. When you’re talking about advertising, you do not have to engage. But when you do, when you engage on Google’s platform, you have to remember that Google owns it. When you engage on Facebook, you have to remember that Facebook owns it. It’s not open source. It’s a for-profit company. So you are providing affirmative consent when you do. And the way that you stop, as ridiculous as this sounds, the way you protect your data is stop accessing the Internet, which I know sounds crazy. But no one says you have to use Google and no one says you have to use Facebook. So it is possible for you to protect the things that matter. Like I talked about your Social Security number, your bank count, things like that. But there’s other stuff that frankly, it doesn’t matter to me whether you have my IP address. You could serve me as many ads as you want if I have no interest in the product. I’m not going to engage. So welcome, you know, to an environment whereas people were constantly negotiating with each other and this is just a different form of negotiation. And I think Joe is right in terms of there is sensitive data that people want to protect, but it’s understanding what the difference is between that stuff that matters and that stuff that really it doesn’t matter.

Laura: So data mining kind of comes off as shady, you know. But it’s a company’s best friend if they want to court new and returning customers. So what are the ways, the different data mining techniques that are out there?

Joe: Look at, you know, kind of what Keith was saying about these different platforms that are out there. Data mining is actually not a bad word, right? It’s just misunderstood. I don’t want to be misunderstood, meaning what can be used for good can also be used for bad. But in data mining, it’s just a collection of data from different sources. By slowing down the process to figure out what kind of information you can get from either a platform or an environment, or we can also be talking about offline or online assets as well, such as mailing lists and things like that. All of that actually becomes valuable data if you can make it actionable. In other words, if you can actually do something against that particular piece of data that can result in a positive outcome for that particular business. And so to talk literally about how we collect data or how you mined data, mining data is not going into the ground like you mine a mineral, and pulling it out and not knowing what you’re actually trying to pull out of that environment. It’s very targeted. In other words, you know, when you walk into Facebook, what information is available from Facebook that you can extract into an environment where you can then make it actionable, either on Facebook or on other platforms or just direct to the consumer or business that you’re trying to reach. So there are hundreds of different ways that you can actually collect data. And, you know, as you go about your average day, whether using your cell phone or a laptop or an iPad, data is being collected every single day. And before the Internet, by the way, it was called MDMs, which are the collection of data that were used for mailing lists that were used for newspapers. The census creates data. You can get data from government organizations. You get data from the registrations for cars. So there’s a ton of data that you can append back to an individual. But to point out what you know, what’s the holy grail or what specific place would you actually try to mine data, the greatest thing about data specifically is that it’s agnostic. You can pick it up anywhere.

Laura: And because client industries we work with like automotive, higher education, personal injury attorneys, veteran-run businesses, to name a few, how would you say that we have grown their business using data?

Keith: Well, I would start with when you are using a particular platform. The platform sets the rules. So you are playing that game. You’re playing their game. Any time you can invert or reverse or alter the rules that they have set, then you have an opportunity to save pennies. And that sounds ridiculous. But when you’re spending millions of dollars, pennies add up. And so we say things like cost per acquisition. What matters is cost per acquisition and your capacity as a business to fulfill whatever service you’re providing or CPG that you’re providing. So if you’re talking about data, the idea is find data wherever you can find it. And stuff that is not important for us to be collecting, we don’t collect. Because there’s no value in us having that information. And so we can strip away information that we don’t want and then we can collect and append and we can create our own audiences. We can figure out what are these commonalities that people have that from an experiential standpoint they’ll react to or though they will have a positive view to. And we talk about growing sentiment. And when you’re talking about something that’s a 50 cent widget, you don’t have to have but much sentiment to sell a 50 cent widget when you’re talking about, you know, 50, 60, 70 thousand dollars to go to school, you probably have to have some sort of sentiment in order to make that happen. So from the data side, what we’re talking about is one of those things that we have in common, the three of us. All have different life experiences. We’re all in different places. There are things that visually you can see that separate us, but there are things that we all hold in common because we’re all sitting in this room cordially having a conversation. So when you find those things, then you can start to realize that there is a way that you can talk to the three of us to get us to engage with a similar product. But the way that you have to talk to the three of us is just slightly different. And so for our clients, we help them grow by sort of helping ask questions that maybe they’ve thought about asking or they’ve never thought about asking, but maybe are unsure that they can actually answer. And then our job is to go in and basically say, look, these things are true. This platform has this set of rules. This platform has this set of rules. But this platform over here, we can kind of do what we want. And if you can create a sequence of messaging that plays within those boundaries, in those three different environments, then you have a higher likelihood of creating a conversion for a lower cost. And I think at that point in time, you can kind of you can mix marketing channels and marketing spend in order to create a user journey, and then from there, you know, we turn it over to the clients and we say when someone walks through your front door, convert it, might make the sale, sell the car. Convince them that that’s the university you should go to or that’s the coffee you should buy. Or that’s the jewelry piece that you should pick out for your significant other or whatever it is.

Joe: Keith, I agree with you 100 percent. I think that the thing for us, though, as a company is that we had to solve the problem. The big problem for us was how do we collect a privatized environment for data, make it actionable in those environments, strip away the stuff that’s not actionable, but actually still gives us persona details about that individual, such as, you know, we don’t sell hairbrushes to bald guys. And as much as it you know, people were talking about how much data is collected and that’s private. It’s private to that individual. We also need to consider that if I’m bald, I don’t want somebody to talk to me about a hairbrush. But if what people are talking about as far as making data unavailable and the only people to have access to it are the platforms, then you’re going to get a lot of information or commercials that are not actually a good user journey or a good product for you. So the chances are you’re not going to experience those things that you’re probably looking for in marketplace the same way that you would if we had this kind of more targeted approach to that, putting marketing messages in front of people.

Laura: Can you think of a time where a client was absolutely shocked about what we showed about their clientele or prospective client?

Joe: I think that happens every day.

Laura: What stood out to you the most?

Joe: Well, we set out to solve a problem. And the problem was, is that the thirst for what you have to spend in the marketplace in order to get or drive a customer to your front door for conversion has at times become untenable for businesses. And so we had to find a way to collect data from multiple environments, privatize that data, mature that data, and then try to figure out what the PPV is, the Propensity and Probability Value of that individual to engage with a specific product or service. In most companies that are out there, develop budgets. Their budgets are pretty simple. “I want to spend ten thousand dollars.” But they don’t understand the math behind what the ten thousand dollars should bring. So it’s more of a reactive environment to just spraying a message in the marketplace and hoping people will return to you. And I think the thing that clients realize that our partners realized when they actually engage with us is that we’re going to take a more disciplined approach. We’re going to actually look at the data. We’re going to analyze that data, and then we’re going to deploy on that data. Only when we see a high value or high probability that person engaging. So that compresses what they have to spend on a cost per acquisition basis. And so we’re having different conversations with clients on higher education, on automotive, on health care or health services, hospitals, you name it. We’re industry agnostic. We’re in every industry. We’re having better conversations with our clients and they’re spending less to get more as a result of this kind of disciplined deployment of data.

Keith: Yeah, I would say we have case studies all over our website and we can talk about them for hours. But I think the biggest thing is when you take, historically, we don’t have many clients. I don’t think we really have any clients that started off as the “big dog”, the one who had the most money to spend and just kind of put money out and market because it could. And we have multiple cases where we have either turned a client into the number one in their market and then we kind of joke. I’ll text Joe late at night and say, hey, guys, this is the fourth time I’ve seen this competitor run an ad. He’s definitely feeling, you know, his competitor kind of inching upon him or sometimes even surpassing. And it’s interesting to watch what some of the larger institutions or businesses here in Denver do when we take small bites out of what they expect to have happen. And so, you know, increasing enrollments or, you know, stopping declines in activity or in the ability to generate revenue will create visceral reactions from the competitors who have more money. And when that happens, we understand there’s going to be some impact. But we also understand and I find it sort of gratifying because I know that, yes, there’ll be some sort of impact to our client. But because we did it once, it was because we were asking questions and solving problems that I know we can do it again. And what I’ll end up happening is these large businesses will start to dump money again and again and again and. There is a there’s a piece of that it realizes that you’re working smarter and you’re actually creating results and that your competition is flailing. A tough word, right? It’s probably a little bit of hyperbole. But, you know, the idea that, well, you spend a dollar, so I’m going to spend three. OK, well, go ahead and spend three, because I’m going to go ahead and spend another dollar and it’s going to be smarter than the way you’re spending your three, and so tell me how that’s working out for you. So there’s a little bit of, I think, excitement. There’s a lot of competition in my head, right in my heart where I’m OK, I like winning, so somebody is gonna throw money at a problem. I’m going to be you know, somebody is gonna throw physical dominance at a problem and I’m going to be smart and I’m going to be strategic in what we’re doing for our clients. So we’re gonna create results and then we write case studies about it and we generally get very positive feedback. And people always want to know, “How do you do that?”. And then that conversation turns.

Joe: We tell them it’s magic.

Keith: Yeah. It’s clearly it’s magic.

Laura: Out of all the digital marketing agencies in Denver, what sets PIN Business Network apart from the rest?

Joe: We’re not a digital marketing agency. We’re a data company. We’re a data company that happens to do marketing. And so we can actually concentrate on the message, the method, and operate with a certain amount of restraint that allows for us to not spend money when that money has a low probability of critical return. So, you know, it’s interesting that you bring up digital marketing, because that’s kind of the bad word, is that there’s lots of companies out there that go out in the marketplace and tell you that they have the holy grail, that what they are going to do for that particular business is going to drive results. And then when it falls flat, the marketing company blames the business. And so we spend a lot more time on our side creating a structure, a workflow of not only the advertising, we put a marketplace on that side, but the message methodology. And we put tools in place that allow for us to measure the effectiveness or what we call a lost opportunity index on the client-side as well, so we can help them. If there is truly a training issue or there is truly a product flow issue on their side, we can identify that very quickly, fix those product flow issues and make sure that they mimic and or align with the message that we push the marketplace and the product delivery that they’re trying to push into the market. So I talk in analogies a lot. I use the analogy of using the computer-generated pictures that are made of the dots. So they came to prominence in the 90s. And I will always remember Mall Rats. I’m sort of squirreling here, but I will always remember Mall Rats and the sailboat. So the point is, when you stare at that picture, as long as you relax your eyes, you don’t care about anyone particular dot. So you relax your eyes and you’re able to look at all of them, then the sailboat magically appears. And I use that analogy in terms of how clients or how we should look at marketing. I don’t have an affinity for AdWords. I don’t have an affinity for Facebook. I don’t have an affinity for display. I think I don’t have an affinity for TV and radio either. I think all of them play a part. I think every one of them has a place in the user journey where it’s affecting positively or negatively the sentiment that is building inside of a consumer, whether they know it or not. And so if all you do as an agency or as a company is AdWords, then the only tool you have is to spend more on AdWords. Well, the last question you asked. I sort of answered about, you know, if I only have a dollar to spend and somebody else has three, but the only solution I have is advertising to lose every time because that person is going to spend three. And I can only meet the threshold of one. So they’re gonna get first placement every single time and I’ll lose if my only option is social media, if my only option is Facebook and I’m going to put all my money in Facebook because the conversions look better or my cost per click looks better or my click-through rate looks better, I will say things to clients like OK, well then your product will never sell to me as ridiculous as this sounds because I don’t have a Facebook account. So if you want to talk to me, you have to find a different platform by which you can do that. And so we talk about the idea that what matters is conversion. And so and the cost that it takes to create that conversion over time, if what you care about is the click-through rate or if what you care about is that the cost per click on a particular channel is what matters. Then what happens if you miss particular people, you’ll miss particular opportunities, and then eventually what’ll happen is as your business starts to decline, you only can go back to the thing that your agency or your company can deal with. And so if that becomes the case, then eventually you’ll run out. And so I think about is the sailboat.  And you want to relax your eyes. Don’t get married to any particular channel. Get married to a strategy. Just follow to the best of your ability where the general public is. vis-a-vis, your product and talk to them where they’re at. And when you do that, you will create opportunities for yourself at a cost-effective rate.

Joe: The thing that we’re talking about here, I just want to say it’s we make things look easy here. But the reality is a lot of moving parts. And so to be effective in the marketplace, you know, it takes a lot of people it takes a large environment and it takes the ability to put a message on any platform. In any environment, we want to meet the right person at the right time with a message are likely to convert with. So it’s using math and science rather than this idea that I can build some sort of creative message in, someone’s going to actually buy something based just on the message.

Laura: It’s just the new wave of segmentation for markets. 

Joe: Yeah and what we do is very complex. It’s what we talk about it on. Right now we’re talking about it. And, you know, people have to wrap their heads around the idea that we can use this intelligence to drive results for them. And that we’re not going to walk into a conversation with a large client or even a small client and say, we’re going to run your AdWords account. And that’s what Keith thing is that the things that people were being taught to follow and to see as important, they’re a piece to the puzzle. But that’s not the final answer of the math problem, right? The final answer, the math problem is revenue. And conversions, people that actually buy that, they actually complete the sale regardless of what you sell. And so we use a different model methodology where we work backwards on a cost per acquisition and then we can compress that cost per acquisition. By creating better message strategies that allow for us to get the click-throughs. But we often say I’d rather talk to a thousand people that want or need the product than a million people. Where only a thousand people may want that product because I’m going to miss, I’m going to miss more opportunities in that environment.

Laura: So what would you say is the biggest mistake that people are making these days in e-commerce?

Joe: How much time do you have?

Keith: Well, look, I think I think guys, as people I’ve been on both sides of the table and I think you want your strategy to be perfect. You want your execution to be perfect. And you want to be able to ask a question and immediately have the answer. So when you’re on the client-side, you have plenty of pressure that’s coming, for your business. You have plenty of expectations and outcomes that you’re supposed to achieve on the on our side. On the data side. That is also true. And so I think the biggest thing that companies are dealing with is, is resources are finite. Money is finite. Not every company has an infinite amount of resources to spend in the market. And so every dollar that you put in market matters. And so Joe and I will say, Joe will say more often than I do, but he’ll say, “If you don’t eat, we don’t eat.” And the idea there is that we’re not looking to take a dollar and then just place it and hope that something happens. And I think the mistake that people are making is there’s data that’s available. There is information that is available. But it’s understanding that that information that is being provided to you from a single source is in that source’s favor. Google Ads will always tell you that the best performing platform to be on is Google Ads. Facebook will always tell you that you are the best place to advertise is Facebook. And so if you look at what they’re providing from a reporting standpoint, it looks great. It’s beautiful. It’s easy. It’s intuitive. And it tells you all of these things. And then all of a sudden you get excited that that’s the platform where I’ve got to go. And so I made a comment to a client a couple of times last year where they were talking about conversions. They expect people to do “this”, so we would talk about how I understand that what you want them to do is you want them to follow this path, but you don’t have to pre-prescribe the path. You can just organically let your customers find that path and then you can accentuate the points along that journey to accelerate it. But you don’t have to be married to the idea that it must happen in this sequence. And so the pushback I was getting was, “Yeah, we’ve set this strategy up and that’s how we’ve sold it to upper management.” And so as I’m wanting to do, I make flippant comments about, well, you can’t actually track the efficacy of the television ads that you’re running, so you should just turn it off. And that always gets a, you know, I get a mixed reaction like Number One, I want to punch you, and Number Two, I can’t answer that question, but what I do know at the end of the day is that turning a mass branding tool like television off is probably a bad idea. I can’t quite quantify what it’s producing, but I know it’s producing something. So what we’ll say is you’re right. The fact that you can’t get a perfect answer shouldn’t deter you from actually expending dollars in the market, because if you don’t, eventually, what will happen is you’ll pinch pennies so much that you’ll have no more customers to actually talk to because your competitors will just intervene halfway through the conversation. So you’re never going to get to the point where when you place a dollar in market, 100 percent of that dollar is traceable and trackable. Because you don’t own the back end of all those platforms. But what you should be doing is looking at how many pennies inside of that dollar can I actually attribute to particular places or particular users or particular conversions. And the less fractional ways that you have, the better your strategy is going to be. So I think, again, in a shorter version, maybe, in English is the biggest issue that companies have is they want the perfect solution and doesn’t exist because we’re humans and we’re talking to other humans. So there is a process of influence that has to occur until there is a chip in my arm that demands that I buy that thing. Because you said so. I will always have the opportunity to choose out.

Laura: Is there anything else you’d like to add in on what PIN Business Network can do for clients?

Joe: We can change their life. So we have a very high success rate. We have a low attrition rate on the clients that we represent. We represent everything from ski resorts to universities to restaurants, auto repair shops, event venues, car dealerships, you name it. We probably represent some of the bigger brands that you’ll find across the country. But you know that I think, again, that I’d leave people with this thought, and that is businesses can become fatigued on what they do, but they can also become fatigued financially if they continue to spend at the same rate by which people are expecting to spend the marketplace. And when Facebook and Google changes algorithms or changes the way they do business and it adversely affects a business, a business needs a stable environment where those types of changes have a very small, if any, effect on their ability to produce results. And I think that’s what PIN brings to the table, is that we have our own tech. We have our own attribution modeling. We have our own persona building tools. We’re a first-party data aggregator. So the things that we have the capability of doing. There’s not a company collectively, nationally that has the capabilities, the tools in the toolbox that we have as a company. So that it could, I would encourage people to check out what we can do for them. But also during that process, you know, ask questions to say, let me talk to some of the businesses that you’re doing business with so I can understand what kind of success or failure we can achieve during this partnership. 

Laura: Thank you, Joe and Keith, for your time and discussing how data helps businesses. For more information on PIN Business Network, visit PINBusinessNetwork.com. Thank you all for listening. Check back again for more podcasts.

Announcer: There has been PIN Business with Laura Cromwell. PIN Business has been brought to you by PIN, or Platform Intelligence Network. PIN is a data-driven marketing company which focuses on a human-centric approach to marketing. Please visit us at our Web site at PINBN.com. That’s P-I-N-B-N dot com or call us at 720-552-5827 that’s720-552-5827.