Data Science

“Our ability to do great things with data will make a real difference in every aspect of our lives.” – Jennifer Pahlka 

Traditionally, advertising and marketing were based on the hope of a random chance. You’d see an ad at just the right time before you were going to buy or, as you walk down an aisle in a store, you’d see a display that would catch your attention. Brands were built through the strategy of frequency and reach. With enough positive impressions, a brand could create an idea in your mind, and, if done correctly, it would tap into the zeitgeist and become part of the culture. This has been the dominant advertising paradigm for the last 50 years. 

With the advent of TV and radio, advertisers were in the position to deliver their messaging at scale. For the first time ever, there was the possibility to overcome randomness with enough advertising and money. In 2014, global advertising spend exceeded $575 Billion and is growing at a healthy 8% per year. In the US for example, advertisers spend $565 dollars per person, per year on paid media. 
 
Unfortunately, most business models expand to a point of absurdity and then collapse. I’m not saying that the ad business is going to collapse… at least not yet, but we’ve reached a point where the number of touchpoints, channels, and outlets has become too expensive to dominate. The result is a chaotic mess of ads seeking to capture your attention. The model of frequency and reach is now reserved for only the wealthiest of brands. 
 
This is where disruption begins. Because the expense is too high, innovation is required to achieve similar outcomes. Tahzoo is a byproduct of this next wave of disruption. We are helping our clients transition into a new way of doing business. I talk and write often about personalized and relevant content – well, this is a way for marketers to break through the clutter and engage audiences. A new paradigm for the 21st Century that ironically has its roots in a more traditional business model of knowing your customers and building personal relationships. No longer do they have to deliver a one size fits all, lowest-common-denominator message to the broadest audience. They can now begin to transform the digital customer experience into something personal and relevant. 

Seeing this change in the marketplace is what compelled me to start Tahzoo. I was excited because I could see the change coming and I knew if we built a company with the right expertise, we’d be relied on by our clients to help them change. This is really what digital transformation is all about and what Tahzoo is all about. 
 
The way that Tahzoo uses data to understand customers and their expectations of the customer experience is unique. We see people in the context of the type and style of content they prefer to consume. We use data from many different sources, web analytics, social data, and behavioral data to understand the format and then the semiotics of the content required to influence behavior or provide a more pleasing experience. With our ability to implement sophisticated content management systems, we can use insight and data to deliver a differentiated customer experience. This is markedly different than the traditional model of understanding people by age or income or other demographic metrics. With the rise of the web, agencies moved to personas rather than demographic models, however, they are utilized to inform the creative experience and not the personal experience. We use data to understand people or discreet audiences, in an effort to provide a more pleasing customer experience. We are actively seeking to understand the models of engagement. Without data science, we cannot deliver personalized or relevant content. We are more or less guessing. 
 
With all the talk of “Big Data,” the real trick is to make the data actionable. If we combine our expertise in building the integrated marketing platform with great data science, we create the possibility of truly connected experiences. We need to continue to innovate in this area and focus on bringing the art of the possible together for our clients. The future of Tahzoo depends on it. 
 
Let’s go be great! 
Brad 
 

The Myth of A/B testing

“The journey is the reward” – Peter M. Senge 

The Myth of A/B Testing- Let us now praise famous data scientists 


Most websites are terrible at selling. As both a customer and as a consultant, I know it. You know it, too. The problem is two-fold. First, insulated by the law of large numbers, online marketers have gotten away with being terrible salespeople because of a failed thinking that if they churn through enough people, eventually some portion of them (usually a minute portion) will convert to customers. It’s a volume business. It’s also a totally expensive, inefficient, and ineffective way to market. 

 
The shotgun approach flowed out of the ancient art of direct mail and telemarketing in which scads of letters and carefully scripted phone calls would blanket the countryside in hopes of converting a few recipients into paying customers. In that world, a conversion rate of one percent—just one customer for every 100 letters or calls—would be thought a resounding success. Do you know any floor salesperson who would consider themselves successful if they converted just one of every 100 customers who came in their door? Exactly. Neither do I. 

 
Nonetheless, the direct marketing industry has thrived. To them, the concept of sophisticated data science was encapsulated in a technique known as A/B testing. A certain portion of the letters or call scripts were ever-so-slightly modified. They might have used different headlines, or different inducements on the envelopes to get you to open them, or the offer might have been tweaked. The marketers then waited to see which letters or calls performed better. In this world, a difference of a few hundredths of a percent was read as if oracles from heaven that one way of saying things was better at selling the product than the other. The phrasing that performed better in this simple, side-by-side comparison became the standard against which future words were tested. 
In the advertising world, this reality is reflected in the traditional frequency and reach data models that define the success of marketing campaigns by how many and how often people experience an advertisement, not how many of them convert to customers. These models were born in an era where the majority of people had fewer than ten channels on their televisions and a handful of brands from which to choose. Firms focused on brand marketing simply because channels and technology did not provide bandwidth for anything else. 

 
Accordingly, companies spend increasing sums on traditional marketing initiatives, only to experience diminishing returns on investment—they spent more and got less. Traditional campaigns struggled to connect with consumers, and, when they succeeded, very little real information was communicated.  Though the least-informed customer can pinpoint the problem, the self-appointed experts cannot articulate a cause. Let me tell you right now, the era of A/B testing was built on a myth. It is an incredibly unwieldy way to market. As I said above: it’s expensive, inefficient, and ineffective. I believe it’s ineffective because it treats audiences as monolithic. There’s no subtlety in the messaging, no ability to adapt to who the prospect is or what they are saying with unspoken language. On a sales floor or at a high-intensity sales pitch, the salesperson always reads the audience and adapts on the fly to the vibe of the customer. It is how selling gets done. I’ve done it a million times. (I’m doing it right now.) 

 
At Tahzoo, we believe that the era of A/B testing is over and that true data science and data-driven marketing is not only possible but critical to business success in today’s global marketplace. The maturation of both big data and content management technologies have reached such a level of sophistication that a new era of online selling is now entirely within reach. You’re witnessing our philosophy—the “Why” of Tahzoo—in action as we press our clients to get better at data science, to improve their technology infrastructures to prepare for personalized messaging in which the data we know about the prospect influences the content they see. You’re also seeing through acquisitions of cool technology such as Adnovate. 

 
So, forget A/B testing. The past is dead. The future is within reach. Our mission at Tahzoo is nothing short of changing the world of marketing through data and technology. Those disciplines have rung the death knell on that old era and marketers and marketing firms need to acknowledge they are no longer the sole gatekeepers of purchase-critical information. To effectively communicate—not merely to present—relevant and personalized content to drive consumer decision-making means that the floodgate to personalized content is opened, and firms must embrace it and invite consumers into a real and lasting conversation. When this happens—when marketing is truly aligned with customer needs—only then will customers be both engaged and educated. And that’s when great things can happen. 

Data Sciences

Traditionally advertising and marketing were based on the hope of a random chance. You’d see an ad at just the right time before you were going to buy or as you walk down an aisle in a store you’d see a display that would catch your attention. Brands were built through the strategy of frequency and reach. With enough positive impressions, a brand could create an idea in your mind and if done correctly it would strike a zeitgeist and become part of the culture. This has been the dominant paradigm for the last 50 years. With the advent of TV and radio, Advertisers were in the position to deliver their messaging at scale. For the first time ever, there was the possibility to overcome randomness with enough advertising and money. In 2014 the global advertising spend exceeded ½ a Trillion dollars at $575 Billion and is growing at a healthy 8% per year. In the US for example, advertisers spend $565 dollars per person, per year on paid media. 

Most business models expand to a point of absurdity and then collapse. I’m not saying that the ad business is going to collapse… at least not yet, however, we’ve reached a point where the number of touchpoints, channels, and outlets have become too expensive to dominate. The result is a chaotic mess of ads seeking to capture your attention at just the right moment. The cacophony is well represented in a picture of Time Square in the evening. The model of frequency and reach is now reserved for only the wealthiest of brands. 

This is where the disruption begins because the expense is too high, innovation is required to achieve similar outcomes. Tahzoo is a byproduct of this next wave of disruption. We are going to help our clients transform into a new way of doing business. You’ve heard me often talk and write about personalized and relevant content, well this is a way for marketers to break through the clutter and engage an audience. A new paradigm for the 21st century that ironically has its roots in a more traditional business model of knowing your customers and building personal relationships. No longer do they have to deliver a one size fits all, lowest common denominator message to the broadest audience they can now begin to transform the customer experience to be personal and relevant. 

Seeing this change in the marketplace is what compelled me to start Tahzoo. I was excited because I could see the change coming and I knew if we built a company with the right expertise, we’d be relied on by our clients to help them change. This is really what digital transformation is all about and what Tahzoo is all about. I want to spend a few minutes today on the role of data science in our company and for our clients. 

The way that we use data to understand customers and their expectations of the customer experience is unique. We see people in the context of the type and style of content they prefer to consume. We use data from many different sources, web analytics, social data, and behavioral data to understand the format and then the semiotics of the content required to influence behavior or provide a more pleasing experience. With our ability to implement sophisticated content management systems we can use insight and data to deliver a differentiated experience. This is markedly different than the traditional model of understanding people by age or income or demographic. With the rise of the web, agencies moved to personas rather than demographic models however they are utilized to inform the creative experience and not the personal experience. We use data to understand people or discreet audiences, in an effort to provide a more pleasing customer experience. We are actively seeking to understand the models of engagement. Without data science we cannot deliver personalized or relevant content, we can only be better at guessing or A/B content testing then our competitors. 

With all the talk of Big Data, the real trick is to make the data actionable. If we combine our expertise in building the integrated marketing platform with great data science, we create the possibility of truly connected experiences. We need to continue to innovate in this area and focus on bring the art of the possible together for our clients. The future of Tahzoo depends on it. 

Let’s go be great!

Brad