Data is the new sexy: perspectives from a VC
I recently sat with Geoff Judge from iNovia Capital (full disclosure iNovia is one of the investors in Chango). As a VC, Geoff shared his perspectives on big data and opportunities for marketers.
Q1. During the Digital Analytics Assocation's symposium this week, we heard a recurring theme 'Data is the new sexy'. What's your opinion on this?
Without question, as that McKinsey study (see Geoff's presentation) has shown, regardless of industry, the companies that have embraced Big Data and hired the data scientists, machine learning PHDs and analysts to better capture and analyze the available data in their industry, and use it as a competitive advantage to benefit their customers, they are the winners.
Q2. During your presentation, you compared CTR in the online world with the consumer response in the direct mail. You argued marketers should use profitability instead. Can you shed a bit more light.
Sure, as I mentioned about my days at American Express, we improved the revenue and reduced our marketing costs greatly by moving to profitability models, as opposed to response models. Responders to a card offer don’t equate to big spenders or credit worthy customers. Your highest responders could be your worst credit risks. Clicks are similar. Folks who click on a display ad are not necessarily more likely to be buyers of your product. You need to measure the View-Throughs of folks who saw the ad and what they transacted (View-Throughs = the people who visited the site within a period of time after seeing the ad). Clicks do not equate with revenue.
Q3. As a VC, you get to see a lot of very exciting ad technologies. What's the most promising thing you saw recently?
Well I guess it’s not recently, but I’m quite excited about what Chango is doing for advertisers, especially Internet Retailers' 100 companies. Chango has made Big Data sing for their clients. More recently we invested in Media Armor, who is bringing the magic of site retargeting to Mobile, which is much more difficult than online, but they are performing in big ways for their Internet Retailers' 100 advertisers. And as we all know, mobile is growing at a very fast clip.