Open data offers a new windfall for brands

Publicly available open data is set to become even more valuable as the 21st century progresses, allowing marketers to gain business intelligence, develop new services and target campaigns.

The data.gov.uk website had published 19,761 datasets by mid November. By the time you read this, that number will be even higher. “New datasets are added every day” on subjects ranging “from education and the environment to health and £188bn of public spending”, says the Cabinet Office.

The concept of open data – any data available to be accessed and adapted by the public – started as an effort towards government transparency going beyond the laws on freedom of information. But in addition to social benefits, there is an economic growth agenda.

“Data is the raw material of the 21st century – a fuel for growth,” said Francis Maude, minister for the Cabinet Office and the man responsible for data.gov.uk, speaking in 2012 at the first Open Government Partnership conference. He also suggested that “to demonstrate its true benefit we need to release the data that will support new businesses, help existing ones to grow and enhance public services.”

So have marketers, entrepreneurs and individuals taken up the challenge?

The Met Office, the UK government’s weather service, has seen increasing interest since its first release of officially ‘open’ data in 2011. “There were 90 registered users in the first month; in the past three years it’s increased to 6,000,” says data policy manager Clare Hubbard.

From registration details and surveys, Hubbard’s team has been able to track how its data is being used. Some are a bit of fun such as the Bicycle Barometer, which uses weather data in combination with information on the London Underground services to deliver a value that determines whether it is better to cycle to work or use public transport. Others are purely business: around 20% of users are making money from the Met Office’s information, she says.

The Met Office’s weather data is a classic example of open data with business applications – the physical climate bowing only to the economic in terms of influence on purchase decisions. “As exposure to sunlight increases, negative affect decreases and consumer spending tends to increase,” finds a 2010 study in the Journal of Retailing and Consumer Services.

Weather data and real-time offers

Digital manager at Arla Foods Christina Skoglund says weather forecasts will “change how we approach and market to people”. She argues: “Traditional advertising has become boring; data lets you add surprise [by targeting consumers in real-time], for example when the sun comes out.”

Last year, Arla brought together real-time weather data, data on location and data on its customers using the Innometrics Profile Cloud. When the sun shone, coupons for Kelda barbecue sauces were sent by SMS to consumers where the company has strong brand presence. The result was a 25% conversion rate and a connection between online and offline. “There’s a gap in the consumer journey that’s filled by the retailers. The data helped us bridge that and to be relevant, personal and accurate,” says Skoglund.

Much like Arla, Bravissimo has made hay when the sun shines. The specialist lingerie and clothing retailer has reportedly been using weather data to build “entire strategies” around weather forecasts provided by the weatherFIT service, which are commercial, not open, data but demonstrate the value of weather-sensitive marketing. This software targets pay-per-click adverts depending on the conditions in a certain location, and helped boost sales by 600% in one campaign during 2012.

Other examples of open data include: census data used for location planning to credit risk scoring, pharmaceuticals companies that are using prescription data and estate agents using around 20 years of data from the Land Registry on the sale prices of houses and flats. Property sites such as Rightmove also make these prices available for house hunters.

“There’s a gap in the consumer journey that’s filled by the retailers. The data helped us bridge that and to be relevant, personal and accurate”

Christina Skoglund, Arla Foods

Land Registry data is particularly interesting, says Harvey Lewis, head of analytics research at Deloitte. “The data goes back to 1995 and there are intelligent users of that: some estate agents are calculating what a property might be worth now based on historical data and that’s a great advantage for their customers.”

Since 2012, Lewis has been working with the Open Data Institute (ODI) to study the potential of open data. A report published by Deloitte in December 2012, showed that while the UK has fewer datasets than France or the US, data.gov.uk was receiving more daily visits than either of them. Between January 2010 – when the site launched – and September 2012, the average number of page views per dataset and the number of clicks on download links rocketed by 285% and 166% respectively.

Open-data-STATS

However, there is no exhaustive list of what data is being used by who, how and for what reasons. The Open Data 500 project in the US is billed as the first comprehensive study of US companies that use open government data to generate new business and develop new products and services. The UK’s ODI is attempting something similar to “map the open data ecosystem”.

Finding out what is going on is the priority, says Lewis at Deloitte: “There’s a big gap that the ODI, Cabinet Office and others are trying to close: the Government doesn’t necessarily know what businesses need, while businesses don’t know what government has. That dialogue is starting to happen.”

Opening up data

Companies will be encouraged to open up about their open data, but many brands approached by Marketing Week to talk about their data strategies closed the door. Sir Nigel Shadbolt, chairman and co-founder of the ODI, points out that companies have got used to paying vast sums of money for data and this has bred a “conservative” approach.

One location data specialist explains how, in his experience, “the closer you get to the real make-a-difference stuff and the further you get from vendor spin, the more nervous [my] customers get”. Perversely, open data can sometimes make this problem more acute in two ways.

He explains: “First, all the input data is open and freely available to everyone, so the only thing that gives you sustainable advantage is what you are doing with it. As soon as you start telling everyone what that is, your advantage disappears. Second, as true open data is available without restriction and registration locks, the owners don’t know who is using their data and can’t force publicity clauses into licenses.”

The ODI admits it has not been easy to assess the who, what, when, where and how of open data usage in the UK. It has “plenty of anecdotal data” but hopes its new study will unearth the “treasure” – that is, the benefits of open data for businesses.

But the commercial importance of open data goes beyond what brands are using. There is also a movement under the Government’s Midata scheme to encourage data release by companies, to allow consumers to benefit from access to their own personal data held by their energy suppliers, for example.

Arla Foods uses data to target consumers in real time with promotions
Arla Foods uses data to target consumers in real time with promotions

Transparency

Some are making more data available about their environmental, social and governance practices, whether through government-required disclosure or voluntarily. Nike is an obvious example – having received unwanted attention about its procurement practices Nike made transparency a hallmark of its brand.

“Offering data isn’t just about reputation,” says Shadbolt. “Companies have realised that releasing data can improve their impact. When Transport for London opened up its timetable data, it stopped paying costly developers and focused on transport [because third-party apps offer the information services instead].”

To allow innovation in the delivery of customer information, Transport for London (TfL) set up a ‘Developers’ Area’ on its website, providing a range of free data feeds across its services. Head of online Phil Young says that “over 6,000 developers have registered for these feeds, supporting around 400 travel applications and helping millions of customers every day who could not be reached by TfL’s information products alone”.

Around £1m has been spent on freeing up the data and making it readily available. That might seem expensive, but Deloitte has calculated that this has resulted in £58m of “customer time savings”.

“Offering data isn’t just about reputation though. Many companies have realised that releasing data can improve their impact”

Sir Nigel Shadbolt, ODI

Combining datasets is where a lot of the real value can be created. “In the old days, we would target a woman in her forties – that would be her label. But now we can target a woman in her forties who is interested in football or buying a beer,” says Arla’s Skoglund.

It is the “precision, depth and accuracy” that is the difference, says Joel Gurin, former chair of the White House Task Force on Smart Disclosure and author of the book Open Data Now. He is also excited about how brands might use “open-ish data” from review sites, blogs and social media as part of branding strategies.

“Many people say that’s a more robust source of information about your brands or products. It’ll open up all kinds of marketing approaches and intelligence,” he adds.

At just under 20,000 datasets into its open data project, the UK is at the start of the journey. Where it goes from here nobody knows, but as the ODI’s chief executive Gavin Starks suggests in a passage contained in Gurin’s book, it will be transformative. “The potential we saw in the early days of the web is what I see now with open data.”

Ed_Wallace_Viewpoint

“Open data is a massively useful resource for us to have: it’s effective, relevant and easy, but my gut feeling is that there are certain parts of the public sector using it more effectively than others. We’ve turned to various data sources – including open data – to build a better understanding of our customers and tailor our offer rather than generalise.

“The ‘Move Maker’ app we’re developing [with agency Design Bridge], uses information such as the nearest GP, quality of schools and proximity to bus services, to help people find the move that’s right for them. It’s convenient and better than the tools currently available on the market.”

Matt_Pennells_Viewpoint-v3

“I don’t think the use of open data has been adopted everywhere in the public sector. It’s certainly not maximised, but that could be said about data in general. As a provider, it comes down to your willingness to share the information in simple, structured formats. Some in the public sector see [the open data agenda] as a burden.

“We’ve created data and consumed it. For a campaign on education around broadband usage we were able to focus where it mattered [on the people scared of technology] and use the right communication channels. It meant we didn’t just blanket message everyone and that means we’re more efficient.”

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Comments
  • Malcolm Lane-Ley 10 Dec 2014 at 9:14 am

    Many progressive brands are realising the rich potential of real time data – be that open or proprietary – to enrich the customer experience, and increase engagement and conversion.

    The issue to date has been that too often, this data has been deployed within the different components of the marketing mix in isolation, leading to an inconsistent and confusing customer experience that has a negative effect on the brand.

    However, by combining this data with the latest technology, such as image recognition or scanning solutions – the most innovative brands are starting to unlock the rich potential of cross-media communications that combine
    traditional print with the full range of digital and mobile media.

    The net result is the delivery of truly integrated communications that give consumers relevant information through the channels they prefer – and brands the data, insight and platform to deliver timely, personalised and efficient communications.

    So yes, there is a great opportunity for brands to take advantage of open data to provide consumers with timely offers; but the far greater opportunity is to use this data within an integrated, cross-channel marketing strategy that delivers relevant communications and drives sustainable brand loyalty.

    Malcolm Lane-Ley, Executive Chairman, Anton Group

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