How to Create New Business

Models with Big Data &

Analytics
Aki Balogh
Calpont Corporation

Agenda
1.
2.
3.
4.

What
What
What
What

is Driving Big Data?

is Big Data?
is Analytics?
can you do with Big Data & Analytics?

What is Driving Big Data?

Where is Big Data today?

What is driving Big Data?

1.Rising volumes of data

2.Falling cost of data
management tools
3.Rising number of Data
Scientists

#1: Data volumes are growing

Growth in
Unstructured Data

Types of Unstructured
Data
Social Media
Clickstream data
Machine-Generated Data
(e.g. logs)
Internal Documents
Notes (e.g. Patient
Charts)
Images
Video
Sound

#2: Data management tools

like Hadoop are driving down
cost

#3: Data Science as a

discipline is growing

What is Big Data?

Big Data is about turning data

into insights to drive decisionmaking

Source: Allen (1999)

A Simple Framework: 3 Vs of
Big Data

Volume
Variety
Velocity

11

#1: Volume

Source: Christopher Bingham, Crimson Hexagon. Better Algorithms from Bigger

Data.

#2: Variety
A few examples how combining data can dramatically change the way
marketers gain customer intelligence and measure campaign
effectiveness:
1. CRM Data + Web Data = Understand actual lead quality not just lead
quantity and drive more intelligent drip marketing, lead nurturing and
re-marketing programs
2. Call-Center Data + Web data = Analyze calls you can avoid and calls
you should avoid. (Example; calls to the Call-Center for simple
customer-support or operational needs that are already serviced
online)
3. Past Purchase Data + Web Data = Segment customers based on past
buying behavior, and use this to drive targeted web campaigns to
loyal customers.
4. Campaign Data + Web Data = Understand multi-touch attribution
and optimize your campaign mix based on behaviors.
5. Social Media Data + Web Data = Measure traffic to your website from
social media campaigns and track actual conversions.

Source: Why Web Analytics is Not Enough. Quantivo.

#3: Velocity

Source: Guavus Reflex Platform.

http://www.guavus.com/#/solutions/guavus-platform/

What is Analytics?

A Simple Framework for

Analytics
Descriptive
Predictive
Prescriptive

Types of Analytics you Could

Use

ARMA
CART
CIR++
Compression Nets
DiscreteTime
SurvivalAnalysis
D-Optimality
Ensemble Model
Gaussian Mixture
Model
Genetic Algorithm
Gradient Boosted
Trees
Hierarchical
Clustering
KalmanFilter
K-Means
KNN

Logistic/Lasso Regression
Logistic Regression with
Adaptive Platform
Monte Carlo Simulation
Multinomial Regression
Neural Networks
Optimization: LP; IP; NLP
Poisson Mixture Model
Random Forests
Restricted Boltzmann
Machine
Sensitivity Trees
SVD
Support Vector Machines

Analytics that are Actually Used

69%

Classification and regression trees / decision trees

25%

66%

Linear Regression

33%

61%

Logistic regression or other discrete choice models

29%

49%

Association rules

10%

37%

36%

K-nearest neighbors

14%

42%

21%

Neural networks

30%

36%

34%

Box Jenkins, Autoregressive Moving Average (ARMA), Autoregressive Integrated Moving Average (ARIMA) or other time series models

30%

35%

35%

Exponential smoothing / double exponential smoothing

22%

Nave Bayes

21%

Support vector machines

20%

Survival analysis
Monte Carlo Simulations

43%

34%

43%

36%

23%

57%

15%

41%

13%

47%
Not at all

6%

Occasionally

44%
40%
Frequently

Classification and regression trees / decision trees and Linear

Regression are the most popular predictive analytics
techniques used.

Source: Ventana Research Predictive Analytics Benchmark Research

18

Who does Analytics?

You dont need to have a PhD

Five Common Types of Analytics

Classify
o Segmentation, discriminant analysis
o Clustering
o Unsupervised and supervised machine learning
Trend
o Time-series analysis
Optimize
o Find the optimal outcome of an objective function
(min/max)
Predict
o Predict the outcome of a single event
Simulate
o Explore the consequences of different choices to help drive
decision-making
o Open-ended: Scenario planning, DSS

So, what is Analytics?

Descriptive
Predictive
Prescriptive

What can you do with Big Data &

Analytics?

What does Big Data Analytics

require?
Data: data availability + storage + integration + data
management tools
+
Analytics: analytic formulas + statistical integrity +
analytic applications
+
Interpretation: business problem + domain expertise
+ visualization + decision-making
This typically requires a team of people with different
skillsets.

What can you do with Big Data &

Analytics?
1. New revenue models
o Ex: Rapleaf scraping the web, collecting contact
information and selling full datasets

2. New user experiences

o Ex: Gmail recommendations for people to CC: on your
email

3. Cost optimization (i.e. deliver same product or

service at less cost)
o Ex: Give your financial advisors tools to help automate
your investment decisions