BIG DATA
28 April 2016
FUTURESCOT 15
The Netflix
approach
to retail
marketing
The decades-old
audience segmentation
model for marketing is
broken, says the
co-founder of Big Data
for Humans. Welcome
to the era of the
‘networked customer’
BY KEVIN O’SULLIVAN
Midway through our conversation
Peter Ellen pauses to read me a quote.
It’s from Todd Yellin, Vice President
of Product Innovation at Netflix, who
said: “Geography, age and gender, we
put that in the garbage heap. Instead,
customers are grouped almost exclusively by common taste.”
This is part of a new way of thinking
in the world of customer marketing,
an approach in which Edinburgh and
Paisley-based Big Data for Humans is
carving a niche for itself.
‘Martech’ – marketing technology
– is busy turning decades of customer
segmentation learning (classifying
people into groups by labels such as
ABC1/C2DE which indicate the top
and bottom socio-economic tiers) on
its head.
Instead, marketers are starting to
pay very close attention to data, and
how it can unlock much greater insight
into their customer base. Who would
have known, for example, that for
one client of Big Data for Humans – a
leading department store – that their
most valuable customers for fashion
retailing were men? Women account
for more in terms of sales volumes but
the most value came from discerning
male customers.
“The really interesting stuff when
we do work with the clients – there’s
usually some quite big surprises as
to who their customers are,” says
Ellen. “The problem with the idea of
a typical customer is that it’s usually a
stereotype. The real customer is never
as trite and stereotypical as the initial
assumption is.
“What we did in Big Data for Humans was that firstly the methods for
understanding who your customers
are were broken for lots of enterprises.
So essentially, in order for an enterprise that trades across channels to
build a traditional customer insights
stack, they nee