Every move you make online is recorded: the websites visited, transactions completed, movies watched, links clicked, comments posted, posts shared, friends called, the list goes on. And, most of the platforms and services that you use for these activities are offered for free. Have you ever wondered why the big corporations offer you free “everything”? They get my data, you may say. But, what is their benefit using your data and billions of other people’s data, forming the big data? (Hint: not just targeted ads!)
“Internet of free things is subsidized by the value derived from user data.”
One of the important things that a business would want to predict is its clients’ behaviour. And, what influences human behaviour? The Personal Culture. Personal culture is the combination of core beliefs, values and biases of the individual. It is unique to every individual. It’s the lens through which he views the world.
But, how do corporations discover everyone’s Personal Culture?
“We are the sum of our choices”, Jean-Paul Sartre
Every small action enriches the person’s story. The fitness trackers, connected devices, connected cars, connected brains (coming soon!), every new technology that he uses, offers a bit more information about himself to the world. The world, then, combines all this information to form concrete knowledge about him (Personal Culture). Then, predicting his behaviour becomes a mere statistical problem.
“There’s a method to my madness”, Shakespeare
Should you be worried?
In today’s hyper-connected world, you have two choices: either you worry about your privacy or be happy about the improved convenience.
Majority of the people lean towards improved convenience (with a bit of privacy concern at the back of their mind). Here’s why. Imagine, you getting personalized suggestions on E-commerce websites based on your previous transactions. Imagine, no longer being bombarded with Spam, as you will receive only those ads that are relevant to you. (Eg: You receive an ad with a 30% discount on a particular jewelery, because, few days back you had searched for that jewelery to gift your wife, but, was turned off by the price.)
Wouldn’t our world be a more understanding place?
Predict your next client
You may now have a fair bit of idea about how prediction (predictive analytics) works. Your prediction is only as good as your data, though. (Build your IT infrastructure, if you haven’t, already. You can start with few business tools like CRM, ERP, etc. Soon, you will have a stream of data to work with.)
IBM’s Watson used predictive analytics to win 1 million dollars on a highly challenging gameshow (Jeopardy!). Google’s DeepMind is trying to predict cancerous tissues in our body. Companies like HP can predict which employees would quit, while, Target can predict which female shoppers are pregnant. Banks can predict whether you will default on your payments, and, Insurance companies can predict when you will die. The future of prediction looks very promising.
Predictive analytics is still in a nascent stage, yet, it has helped businesses to save billions of dollars or create billions of dollars, so far. This would have been impossible to achieve without the power of prediction. Until now, the cost of the IT infrastructure had been prohibitively high for the majority of small businesses to install predictive analytics capability; not, anymore! Now, you can have the predictive analytics capability of big corporations for a reasonable price. The best part is, you do not need any technical skills. If you can use Facebook, you can use it, easily.
An interesting side-effect of this newfound power of prediction: we all will understand each other, better. What do you think?