Every day, from the moment we wake up, all of our steps are being tracked. We are not talking about a reality show. Companies such as Apple, Facebook and Google are already mapping the interactions between humans and devices, and ultimately doing something with the aftermath of these interactions.
The immeasurable amount of data (unstructured and structured) being generated every second globally from an increasing number of sources – from people transactions or social media interactions, to machine-to-machine (M2M) communication – has changed the competitive environment and hence the organizations’ way of thinking about the usage, collection, and analysis of data.
Remaining competitive in a scenario in which customers are less loyal, are co-creating the business models, and have unlimited access to information is not as easy as it was in the past. In the data age, information has become as valuable as oil.
Concept understanding is still a barrier to overcome
First of all, it is important to define what Big Data is. Big Data is a large and complex volume of data which is growing and changing too quickly for traditional databases and applications. Big Data represents the collective and exponential growth of both structured and unstructured data from every imaginable digital source. The word ‘data’ within the Big Data concept is usually misunderstood or even misused instead of ‘information’. Overall, data is the quantitative or qualitative content that alone does not transmit any kind of message. Information is the result of a more complex process that includes input (data), processing (data analysis), and output (information itself).
The Latin American region is still in a learning period about Big Data. The competitive advantages of adopting Big Data are more perceivable for the IT participants than for their clients. However, the concepts of Big Data as well as its requirements are gradually becoming more understandable. Frost & Sullivan’s Analysis of Big Data and Analytics Market in Latin America, finds that the combined market of Brazil, Mexico and Colombia generated revenues of US$538.3 million in 2015 and is expected to reach $1,956.5 million by 2020 at a compound annual growth rate (CAGR) of 29.4%.
Main area of investment
Customer experience is so far the main area of investment. This is a reality since all companies have concerns about how their customers are interacting with each other and, consequently, how they perceive these players. Undoubtedly, the exponential growth of social media and mobile devices usage has been a lever for the Big Data and Analytics market. Latin American companies from various verticals, such as Retail, Financial services and Telecommunications increased their concerns about how to handle and transform all of this data into insightful and relevant information. The demand for Big Data projects is increasing notably among companies trying to improve the customer experience every time an interaction occurs. Whether this is a relationship in a physical or online store, the necessity of identifying customers, differentiating them from the others, interacting in a good manner and personalizing the offers according to their profile is nowadays essential.
What could drive or restrain this market in Latin America?
When it comes to data management, its quality is the first issue that needs to be addressed. Poor quality data can lead to several erroneous results during the analysis process. Proper data quality management is mandatory to extract valuable insights; without data-cleansing it is almost impossible to provide a single view of the customers and their behavior, and to map all their points of interaction with the organization.
Companies may have already heard about Big Data, but most of them still do not know how to begin using it to their benefit. One of the main factors is the use of different taxonomies by different providers in Latin America. This makes companies confused about investments. In addition, most of them do not have much expertise in using analytics on the company data, which can help them make better business decisions.
The market needs to keep in mind that the most valuable thing within Big Data and Analytics segment is the real-time insights provided by analytics. Considerable amounts of data have been captured and stored since the 1960s; however, the exclusive focus on these two activities has lost its purpose nowadays. The relevance is on the capabilities to analyze this data in a timely manner, which can lead to a competitive advantage and, consequently, better business outcomes for companies. Since all customers and companies are, even against their will, generating data, it would be like shooting yourself in the foot to ignore that Big Data and Analytics are a prerequisite to succeed in the future.