The DoubleThink » Analytics

Heatmaps for Free

Dimitri — Thu, 18 Nov 2010 16:00:31 +0000

I remember the first time I showed a heatmap of a website to a client in a new business pitch a couple of years ago. They thought it was the coolest thing they had ever seen and I believe we won the pitch just because of it. Nobody was doing it at the time. We had partnered with one of the pioneers in the area and it was a big undertaking. But it paid off. Soon after we started using them for all of our clients. The results were great and for a short amount of time it was a real differentiator for our team. We even rented an eye tracking machine so we would have it on site in our office (it sounds more spectacular than it is. It’s really just a PC monitor with a couple of sophisticated webcams).

But soon everyone started doing them and while they still have value, heat maps no longer are a differentiator. I recently found out they have entered the final stage of commoditization – they’re given away for free. On Tim Ash’s website http://www.attentionwizard.com you can create your own heatmaps in a matter of minutes – for free. I gave it a go for the doublethink. You can see the result above. If this was an ecommerce site I would probably make a few changes … .

While the tool is pretty cool, I think the most interesting part of this whole story is how a cutting edge, highly sophisticated optimization technology got automated and completely commoditized in only a matter of years. Change really is accelerating!

Music is Math

Dimitri — Sat, 11 Sep 2010 12:34:01 +0000

I have been pretty obsessed with a little side project over the last couple of weeks which explains why activity on the left column on this blog has been low … . It all started about a month ago when a colleague in London told me about the Korg drum computer app on the iPad which transforms the iPad into a wicked beat machine. I was immediately hooked. After a couple of days of beat making I decided I was ready for something bigger and I started looking into other music software. That’s when a very kind Best Buy employee introduced me to Reason. My life will never be the same again!

I have no musical background, have never played an instrument and never went to music school. I was a complete novice when I picked up Reason 3 weeks ago. A couple of Youtube reason tutorials later, I launched my own little one man band on myspace.

The software is incredible. It allows you to make any sound imaginable, from horns to electric guitars, from techno synthesizers to monk chants and crickets. These instruments play notes on different tracks which you can then combine in a mixer. The picture below shows a Reason screenshot with a song that is played on 12 different tracks.

It also has a number of drum computers you can use to make your own beats or you can select from a library of hundreds of pre made loops. The possibilities seem endless and while you can make things extremely complicated (Reason is used by pro’s like the Prodigy), I found myself finishing my first song in just 2 days.

What quickly became clear in this process is how similar making music is to analytics. While I was composing and arranging, it felt like I was using the part of my brain I use while writing code in SAS. That shouldn’t be surprising. The theory about the similarities between music and mathematics goes back all the way to Plato. There is even a wikipedia entry devoted to the subject. The screenshot above shows has the structure of a database. Every track is a file of data (notes) that is linked through the rhythm and the beat.

Analytical skills came in really handy in interpreting the notes, especially when you have never had musical training. I quickly discovered how useful midi files are. Midi files are similar to mp3 files but rather than containing the sound waves, they contain the musical instructions for the instruments (the notes, the rhythm, the velocity and length of the notes, …). You can read them automatically into Reason and they show up like different tracks on a screen like the one shown above. You can then select which instruments you would like to play which tracks and then move blocks of notes around to compose and arrange different variations of the song. A lot of midi files can be downloaded from the web.

Not every song is available on midi though. When I wanted to make a dance version of one of my favorite 90’s grunge songs I couldn’t find the midi for the song anywhere. I was stuck. So I started looking for a solution and came across Widisoft, a software package that reads in sound files and translates them to midi files. Here is a screenshot of my grunge song translated by widisoft. It is remarkable how similar it looks to the punchcards that came out of the first computers. It’s data in it’s purest form!

At first sight the screenshot looks like random dots on a couple of bars. But when you listen to the song and look at the data at the same time you quickly start to see the patterns that identify which data points correspond to which sequences and instruments. Some intuitive pattern recognition allows you to split this data stream into different organized tracks pretty easily. This creation of order out of data chaos is very similar to what data analysts do when they analyze large data sets.

I decomposed the data, mapped the different tracks to new instruments, put it all on a house beat, rearranged the sequences and recorded Slaphappy. Fans of early 90’s Seattle grunge might recognize some of the riffs.

Learning to Read the River

Dimitri — Fri, 06 Aug 2010 15:15:29 +0000

Last week Ogilvy launched their new thought leadership program called the Red Paper series. I was fortunate enough to be able to write the very first one – Learning to read the river. The paper describes how all the data that is generated today provides a huge opportunity for companies to grow their business. It describes 4 building blocks companies need to put in place in order to extract business value from the data : Ergonomic Measurement, 3 Step Insight, The Single Enterprise View and the Math Marketing Organization.

You can find the paper here. Hope you like it!

Read the river_ogilvy_red_paper

View more documents from Ogilvy & Mather Worldwide.

The US Census – Mother of all Surveys

Dimitri — Wed, 23 Jun 2010 21:56:38 +0000

Imagine this – a Census worker walks on dirt road deep in the woods somewhere in North Michigan. After half an hour she reaches a bungalow, the 1^st sign of life she’s seen in a while. Just as she pulls out her new 2010 Census form she sees a bag hanging from the doorknob. In it she finds a Census from 2000 … .

This is the story Dr Robert Groves used at the beginning of his presentation at the ARF Audience Measurement Conference in NY yesterday. He runs the US Census Bureau, the government bureau in charge of surveying every household in the US once every 10 years. The Census is used to obtain the vital demographic statistics that are necessary for government planning. Dr Groves’ story and subsequent presentation showed that it is probably one of the biggest logistical exercises in the world.

The scale of the operation is pretty incredible. The government sends out the questionnaires to 140 million households and looks for a 100% completion rate. In this year’s Census 72% of the US households mailed their survey back. That is the same response rate they had when they did the last census 10 years ago. Any direct marketer would dream of having response rates at the same level of 10 years ago so this was a phenomenal achievement. A 1% drop in response rate would have cost the Government $80 million. This is because if you don’t respond by mail, they will send around someone to your house to ask you to fill out the questionnaire. They have a small army of 600k census workers following up on the 47 million households who didn’t respond. This in-person follow-up visit costs the government on average $57. (This includes the costs of handling the 300 assaults on census workers committed by anti-government minded non-responders!). The cost of a response by mail is only 42 cents so with these economics it became crucial for Dr Groves’ team to drive up the response rate.

They did this in a number of ways. First they made the questionnaire shorter which always drives up response rate. Then they added 2 touches to their communications cadence. They sent out a pre-announcement card before the questionnaire was sent and they sent out an extra reminder after the 1^st questionnaire was sent. This apparently consumed the entire printing capacity of the US!! They also paid a lot of attention to language. The questionnaire came in 6 languages and they had completion guides for an additional 59 languages! They also activated 250 thousand grass roots organizations who would work in the local communities to ask people to fill out the questionnaire. This according to Dr Groves was one of the main contributors to the high response rate.

Then they did a marketing campaign which cost them $350 million, an investment they could easily show the positive ROI of (all they needed to achieve break even was a 4% increase in response rate …). This was a fascinating campaign, perhaps the biggest multicultural campaign ever. It included a K-12 campaign designed at informing children of immigrant families about the Census. These children are often the 1^st to learn English in the household and can therefore be the main influencers. The campaign was run by a consortium of ethnic agencies who had to buy media in 28 languages, including Farsi, Armenian, Uruguayan etc. I saw Khmer videos, Indonesian outdoor ads and native Hawaiian posters. I have never seen localization at that scale.

Equally impressive was the use of real time tracking, modeling and optimization. Dr Groves’ team implemented daily tracking studies and performed statistical analysis every night to determine the effect of their media investment on awareness and behavioral intent. This allowed them to identify pockets of the population that were lagging behind. 18-24 year olds were an example. They tend to think the Census is not for them – that it is only for old people … . The team saw this very quickly and acted immediately by sending out targeted messages and by activating grass roots organizations. Dr Groves said the government saved 100’s of millions of dollars through real time tracking and optimization.

At the end of the presentation we got a sneak peak at some early results. The big trends shouldn’t come as a surprise. The population will grow from 309m to 439m in 2050. 20% of all households will be over 65 years old in 2050. There will be significant growth in the Hispanic population from 8% in 1980 to 30% in 2050. The Asian population will grow significantly as well. Apparently 47% of the national fertility in the next decades will come from minorities. We could also see the emergence of a bi-modal income distribution with an increasing gap between 90th and 10th income percentile – $138k vs $12k.

The US Census is a remarkable project. In terms of scale it is maybe only rivaled by the Indian Census which, as I found out on my trip to Bangalore last week is scheduled for the first time in 2011. Imagine surveying a billion people, a large portion of which live in remote, underdeveloped rural areas. I wouldn’t want to be in charge of that job!

thedoublethinkTV – Interview Dominique Hanssens

Dimitri — Fri, 18 Jun 2010 12:34:20 +0000

The latest video on thedoublethinkTV is an interview with Dominique Hanssens, Dominique Hanssens is the Bud Knapp Professor of Marketing at the UCLA Anderson Graduate School of Management, where he has been on the faculty since 1977. He has served as the school’s faculty chair, associate dean, and marketing area chair. From July 2005 to June 2007 he served as Executive Director of the Marketing Science Institute in Cambridge, Massachusetts. He is also one of the founding partners of Marketshare Partners.

In the interview he discusses a wide range of topics in the area of marketing effectiveness and accountability.

You can watch our other videos on thedoublethinkTV.

Next Generation Geo Marketing

Dimitri — Wed, 09 Jun 2010 12:00:06 +0000

A friend just sent me this beautiful visualization of where people are taking pictures in London. You can clearly see the high traffic areas around the tourist hotspots. It’s a great use of the type of data people are generating by going about their everyday lives. It also shows how this data could become really practical for marketers trying to find out who is where at what moment in time. I am sure the picture would change if we were to look at certain times of day, days of week, seasons or even profiles of the people that are taking pictures. The view would be very different for people who live in London vs those who don’t for example.

This type of location based behavioral data could give marketers very valuable information about when they need to be where in order to surround their target audience. It seems this data would be able to provide much more detailed information than what is currently available. While this particular application only looks at where people are taking photographs, other location based services like Foursquare generate tons of data about what people are doing where. Foursquare already automatically shows their users which locations are trending (ie becoming popular) real time.

The application of location based behavioral data will go well beyond location based targeting on mobile devices. I believe it will soon become the basis for the next generation of geo marketing tools. Retailers for example could use it to determine where to locate their stores and media planners could use it for planning their outdoor advertising. We could even use this new type of data to profile zip codes based on the activities of the people who live there. These zip code profiles could be used in the same way marketers are now using socio demographic profiles of zip codes for targeting. The current profiles are pretty static since they are based on more traditional sources like the Census. The behavioral location based profiles could be much more dynamic and a lot more detailed. A company like Foursquare, if it wanted to, could actually already very easily make these zip profiles available to marketing professionals. This would make them a real competitor to established 3^rd party data vendors like Acxiom and Experian.

The Value of Stories

Dimitri — Fri, 07 May 2010 21:01:18 +0000

What is the actual value of a story? Are people prepared to pay more for something if there is a story attached to it? It turns out that they are. That is the outcome of a very original experiment by writer / NYT columnist Rob Walker. I saw Rob speak about his Significant Objects project, a project which I think might have generated a very significant dataset.

Here is what Rob did. He purchased a bunch of random objects on Ebay, most of them for less than $4. He then distributed the objects to his friends, fellow writers and artists and asked them to write a short story about the object they were given. He then put the objects back up for sale on ebay with the story in the description to see if people would pay more for the object now there is a story attached to it.

It turned out they did. When he sold the first 100 objects, he essentially sold $120 worth of objects for $3,612 – a 2,776% significance markup as he calls it. The object in the pictire above was the highest seller of the 1st wave of products he sold – $193 for a statue he initially bought for $3. He even sold a 25c plastic banana for $75.

So people were prepared to pay a lot more than the initial value of the storyless object. In fact the difference was so big that Rob concluded that the real value was in the story – the object was merely the vehicle for the story.

That’s very interesting and it obviously gives us a view in how brands work. But what I find most interesting about the experiment is the dataset it created that showed the exact monetary value of stories. I would love to analyze that data to see what really drove the value of the story. Was it the object, the synergy between the story and the object, the reputation of the writer or are there any attributes in the story itself that give us clues about what creates its value.

The data is available on the website. I might play around with it if I find the time. Here is the video of Rob Walker’s presentation at PSFK.

Your voice reveals your subconscious

Dimitri — Tue, 06 Apr 2010 16:27:25 +0000

I met a slightly creepy yet really interesting company yesterday. Voiceprism has a technology that analyzes sound waves generated by the human voice. This gives them the ability to listen to an individual for 10 minutes, establish a baseline voice pattern and then detect the deviations from the normal frequencies. These deviations have proven to be indicative of emotions such as excitement, stress, delight, anger, …

This reminded me of the biometrics Innerscope looks at to gauge emotional engagement. The voice could be an additional data point that can give us clues about what is happening in the subconscious. The main differentiator for this technology is its ability to listen in on thousands of phone conversations. This means it can be used at scale in a cost effective way. I haven’t seen another technology that has the potential to capture data from the subconscious for potentially thousands of consumers.

They talked to me about their work with insurance companies where they analyze claims calls and flag insurance claims that should be investigated further based on the stress levels of the callers. They were basically doing automated lie detection. This apparently helped insurance companies dramatically reduce fraud levels.

I think there could be other interesting applications, especially in quantitative research where it is often hard to quantify true emotional engagement through analyzing what people are saying. How they are saying it can now apparently give us valuable clues as well. Click here to see a video of how the technology works.

Big Data

colin — Wed, 17 Mar 2010 14:45:19 +0000

The last couple of weeks have seen the ‘new data’ in the news.

The Financial Times ran an article “Smarter Leaders are Betting on Data” by Stefan Stern. This introduced me to a useful idea from Vivek Ranadive, the CEO of Tibco, a software company and general data visionary. He argues that in measurement of consumer activity, we should think of events not transactions or “in-memory analytics” in the jargon.

This means that we should measure in real time and give us much weight to “near misses” as transactions, as these can be even more telling (the behavior leading to one purchase rather than another, for example.

The Economist ran a special report on “The Data Deluge”. The new idea here, I thought, was “six principles for the age of big data”. The premise is that data has now become a major industry in its own right. The most provocative essay focused on regulation. As the industry matures, it will raise a set of quandaries that we should start thinking about now. Here are the six with suggested solutions:

Privacy: The dilemma is managing the tension between privacy and openness. The solution is allowing individuals to correct their own data. Upcoming technology should enable this.
Information Security: The 2003 Californian law requiring companies to notify customers of security breaches pushes companies to invest in prevention
Digital Records: A call for automatic deletion of expired digital records. Yet legislation is moving in the opposite direction.
Processing Data: Data might promote racial or other discrimination. Solution: regulate against using an individual’s data against him or her on the basis of something that may or may not happen.
Personal Information as a Property Right: You own your photos, not facebook. Data portability will promote competition, just as cell phone number portability did.
Integrity of the Information: The World Trade Organization should legislate to protect the data commons.

Big picture stuff, of course. But refreshingly constructive and practical. It seems like the marketing industry should identify its own subset of issues and address them in a similar spirit.

TV’s emotional impact

Dimitri — Fri, 12 Mar 2010 20:34:26 +0000

In my previous post I listed some empirical evidence that shows that TV advertising is becoming increasingly effective. One of the reasons is that TV is a superior medium for driving emotional engagement. The role of emotional engagement in driving purchasing behavior has been hotly debated in the last couple of years. This is as a result of advances in neuroscience that have demonstrated that the decisions people make are often a result of what happens in their sub-consciousness. As a result the traditional linear AIDA model, where the role of communications and advertising is to move customers down a linear path from awareness to interest to desire to action by grabbing their attention, has been severely challenged.

Robert Heath has published extensively on this topic and has shown that the role of emotions in the decision making process are very important. In a 2009 Admap article about how TV builds brands he said :”Early advertising models that addressed the role of emotion in advertising reflected the thinking of the time, which was that ‘conscious thinking’ leads to ‘feeling’, which leads to ‘attitude change’, which, in due course, leads to a purchase decision. They were not to know at the time, but they got it seriously wrong. Feelings and emotions are processed much more quickly than thoughts.” Heath has used brain scanning technology to show that we usually make decisions up to 1/5th of a second before we are aware of them. He says that “we always form an attitude about a decision through emotional and subconscious rational processing before we start to consciously and actively ‘think’ about it. So our conscious thinking tends either to support the decision or counter argue it. There is empirical evidence […] showing that the presence of brands inhibits processing of product attributes and encourages consumers to use shortcut to validate their brand choices.” This is illustrated in the diagram below.

If people use brands as subconscious short cuts, then brands need to be built through communicating at the subconscious level.

This is where TV is especially powerful. Contrary to other media such as print that require conscious processing of information (ie reading), TV more than any other medium can work at the subconscious level by evoking feelings through the uses of visuals and sound. This is why TV is such a powerful medium for creating brands. It does this through emotional communication. And Binet and Field have demonstrated, in the study of the IPA databank I mentioned in my previous post, that emotional campaigns consistently outperform rational campaigns in terms of driving sales, share, price elasticity, loyalty and penetration.