Or maybe; “I know 90% of the data I capture is useless, I just don’t know which 90%”

On January 28, this year, Tim Cook, CEO, Apple delivered a presentation at a Data Privacy Day event.

Here is some of his most insightful words about the use of data:

“Technology does not need vast troves of personal data stitched together across dozens of websites and apps in order to succeed. Advertising existed and thrived for decades without it. And we’re here today because the path of least resistance is rarely the path of wisdom.

“At a moment of rampant disinformation and conspiracy theories juiced by algorithms, we can no longer turn a blind eye to a theory of technology that says all engagement is good engagement, the longer the better. And all with the goal of collecting as much data as possible.

“If a business is built on misleading users, on data exploitation, on choices that are no choices at all, then it does not deserve our praise. It deserves reform.”

As I’ve been saying for more than a decade, “Most companies aren’t correctly managing their small data, let alone getting BIG DATA right.” And it’s costing them dearly. Small data such as a customer’s name, address, phone number, email address or previous purchase are regularly incorrect, or not even stored. Marketers appear to be focusing on the least valuable data.

For all the investment in BIG DATA this century (and marketing automation software that functions from that data) there has been almost no significant change in marketing results or performance of campaigns. The majority of sales in every category occur without any help from big data.

Ask any senior marketing executive “how has the investment in bigger data helped their sales?” If they’re like those I talk with, they’ll say “I have no idea” or “it hasn’t“. But hey, they do know how many people bounced off page three of their website and who liked a Tweet.

The 90/10 Rule applies to data
90% of the value from using data comes from 10% of the data. Yet most marketers are playing at the margins where the incremental value of lots more data doesn’t cover the cost of investing in gathering it.

I declare my hand here – I am a firm believer in the power of relevant data. I also understand the delusion of productivity created by capturing lots of data for no other reason than it can be done. In 1988 I opened Australia’s first data consultancy and database management service while running Ogilvy & Mather Direct – called Ogilvy DataConsult. Three years later I opened my own data marketing service as part of my agency – MAD. And have worked with data ever since, even publishing a magazine called Database Marketing.

It may come as a surprise to some, but marketing data wasn’t invented yesterday – there is just lots more data now, most of it useless.

Just because you can doesn’t mean you should
Just because we can track every digital contact doesn’t mean we should. It’s the equivalent of recording the fact a shopper walks into a grocer, looks at the bananas, walks towards them, maybe even picks up a hand, then puts them down before deciding not to buy – possibly because they remembered they had some in the fruit bowl at home? What is the value in tracking this action? So why do we chase non-qualified consumers around the web with irrelevant messages just because they visited our website?

Stop trying to sell me breast pumps
This happened to a friend of mine who was in her early sixties at the time, as well as me when I tested her experience. After searching for baby gifts online, the insanely stupid marketers started following us around the internet trying to flog us breast pumps. Each time we visited a site, up popped breast pump advertisements.

Even worse are the B2B marketers – particularly those flogging marketing automation software – who follow you around after you’ve visited their site. When browsing a website for personal relaxation, that has nothing to do with business, I get ads asking me to trial their marketing automation software. Or they promote an offer to download a “definitive guide” which at best is nowhere near definitive, rather it’s a sales pitch for the software the marketer is flogging. Here is why most definitive guides aren’t – definitive that is. All this does is damage their credibility.

How ignoring small data resulted in abuse of senior citizens
My 80-year old neighbour shared his story with me last month, he was shaking as he told it. His bank mailed him a letter telling him the email address on his account was incorrect and he needed to fix it. Obviously this was a data-driven message as no human in their right mind would have sent the letter. He logged into his account and checked his email – it was correct. It’s the only email address he has ever owned.

He then received another letter threatening to charge him fees if he didn’t fix the email address. So he rang the bank. They told him he had to go to his branch – which has been closed – so they gave him a new branch to attend. When he arrived he didn’t have the 100 points needed to prove his identity, despite having his bank cards. He had to drive home and then drive back to the bank.

Upon returning, the clerk checked the account and realised the email address was being used in my neighbour’s joint account with his wife. So the clerk demanded to speak to my neighbour’s wife. He told her she was in a dementia hospital. The clerk asked to speak to her there. My neighbour explained it was impossible, as she cannot converse and he was her legal guardian. The clerk then demanded proof.

So my neighbour had to go home and contact his lawyer to get legal documentation to prove his status as legal guardian of his wife who is living in a dementia hospital, because the bank’s data-driven systems believed his email address was incorrect. He ended up driving to the bank branch three times to accommodate their requests.

The clerk finally admitted that the email address was correct and the whole saga was a complete data-driven waste of time. You can imagine how my 80-year old neighbour felt? This bank makes $Billions in profit every year and spends $Millions on BIG DATA capture.

My (even older) father is a lifetime customer of one of the other ‘Big 4 Banks’ in Australia. He used a travel card in 2004 and cancelled it in 2005 after using all the funds. Every year since, he gets a data-driven bank statement telling him he has no funds on his travel card. He has spoken to the bank more than a dozen times and rung them more times than he cares to remember to advise them he no longer has the travel card account. They finally admitted they have no idea where his account is in the database, nor do they have any idea how to stop the statements being issued. This bank also makes $Billions in profit every year and spends $Millions on BIG DATA capture.

My father is also a customer of the largest telco in Australia. He was asked to provide an emergency email address in his account in case of, well, an emergency. With my permission he used my email address. Immediately I started to get his monthly statements emailed to me, while he didn’t get any statements. Over a period of six months he wrote numerous letters and emails to the telco requesting the mistake be corrected, and also rang the offshore customer support a few times. I forwarded the email to some customer service address to try to sort it out, but just got a useless auto-reply. Hours of my father’s and my time were wasted because the telco’s data-driven systems.

And not only that, the statements incorrectly spelt my name. I’ve given up asking the telco to fix it. The data-driven system automatically combines my first and middle names into a single word. Go figure?

Forget BIG DATA

Rather than waste money on gathering terabytes of useless data just because you can, and then relying on computer software to do your customer service, my advice is to invest your marketing funds in human beings who can talk personally to your customers. They’ll have far more success than any automated data-driven programs and ensure the relevant small data is correct. You’ll make more money and have happier customers. You’ll also inject more money into the economy by employing humans.

Only then, once your small data is correct, should you consider an investment in BIG DATA. And then, only if there is proof the marginal returns are worth the financial investment and effort – not to mention improve, not reduce, your customer service and bottom line.

Gotta go now – I have my monthly three-step data verification to complete, so I can get permission to access my own email account. Where is my passport for proof of identity…