90% of the world’s existing data has been created in the last 2 years!
An exponential explosion in the amounts and types of digital data available has given rise to the term “big data”. This widely expanding digital realm has been fed, in part, by the fact that many aspects of our lives and pursuits have moved online, been made mobile with smart phones, are tracked by sensors, and new sources of data have been flooding in through social media, digital images, and video. Big data is also not just about the sheer volume of data, but the accelerating speed at which it is being created. To that point, a widely reported data statistic states that 90% of the world’s existing data has been created in the last 2 years! Just ponder that for a second.
To reinforce this sense of scale and speed, statisticians and researchers of all bents have come up with a wide array of mind boggling facts to chew on:
More data has been created in the past two years than in the entire previous history of the human race.
By the year 2020, about 1.7 megabytes of new information will be created every second for every human being on the planet.
Today, global IP traffic has reached 1.1 zettabytes – that’s a number with 21 zeroes after it. By 2020, global IP traffic is expected to grow to 44 zettabytes or 44trillion GBs!
How much data are we generating every day?
Digging a little deeper and compiling facts from Digitalcallout, we can see how much data our activities and behaviors are actually generating and adding to this flood of information:
Twitter: 500 million tweets per day = 15 billion characters = 12,000 copies of Harry Potter and the Order of the Phoenix = average reader 20 years to read all tweets generated in one day
YouTube: 300 hours of videos are uploaded every minute = average viewer 50 years to watch all videos posted in a day
Facebook & Instagram: 350 million & 70 million photos being uploaded daily. Over all sites, we are sharing 1.8 billion images on a daily basis = at 3MB/image and iphone with 64 GB memory = 90,000 iPhones per day needed to store these images
WordPress: users publishing more than 1million pages daily.
According to IBM: we create 2.5 quintillion bytes of data every day (a number with 18 zeroes after it) = 2.5 million hard disks at 1TB each
Data is the New Oil
It is important to underline again that, since so much of what we do today is in a digital environment, a lot of this scale and speed in data is being propelled by our own collective behaviors and inputs. So, imbedded in this vast, rich mass of raw data are our deepest likes, dislikes, thoughts, interests, wishes, goals, needs, etc . The value of this kind of information and reconnaissance has already likened big data to being referred to as the “new oil” and a main driver of future economic activity. As such, a massive wave of investment and innovation is being focused on analyzing these large reams of data, distilling insights from them, and developing highly targeted courses of action. The evolution in techniques of data analytics have now made it possible to help connect the dots among diverse data sources, conduct better searches, provide real-time analysis, connect prospects to products, and automate tasks.
So, if big data is the new oil, artificial intelligence and machine learning are becoming the new combustion engine. If data is not refined, it cannot be used. As further explained in a recent World Economic Forum article: “machine learning is a way to use algorithms and mathematical models to discover patterns implicit in data. The machines then use those often complex patterns to figure out on their own whether a new data point fits, or is similar, or to predict future outcomes. Furthermore, new machine learning models have emerged recently that seem to be able to take better advantage of all the new data. For example, deep learning enables computers to ‘see’ or distinguish objects and text in images and videos much better than before. Advanced algorithms are even intersecting with behavioral insights to positively or negatively reinforce desired behavioral outcomes!”
Implications and opportunities
It is clear that for all size businesses, in any industry, a huge competitive advantage awaits firms that can harness this data resource. Providing deeper insights and personalized engagement opportunities with prospects and customers, it can potentially lead to better closing rates, more meaningful client relationships, and stronger retention for financial advisors. This in turn will be transforming business thinking and decision-making as big data can be made immediately actionable and help advisors become more client-centric. This will be a major change in financial services business mindset. The key is to be clear about what your specific strategy around mining and analyzing big data is: What data needs to be collected? Why are you collecting it? What decisions will you make based on it? Another reality emanating from all this is the growing need for financial advisors to partner with tech firms to help direct and guide these new data technologies to advisors’ business needs. The goal is to reframe big data as a practical way to make more strategic decisions and engineer better client engagements and business performance.
Bottom-line: big data is growing exponentially, contains competitive advantages for early adopters, and will transform the future of the financial services industry.
Written by Bill Hortz, Founder&Dean, Institute for Innovation Development
The Institute for Innovation Development is an educational and business development catalyst for growth-oriented financial advisors and financial services firms determined to lead their businesses in an operating environment of accelerating business and cultural change. We position our members with the necessary ongoing innovation resources and best practices to drive and facilitate their next-generation growth, differentiation and unique community engagement strategies. The institute was launched with the support and foresight of our founding sponsors - Pershing, Voya Financial, Ultimus Fund Solutions, Fidelity, and Charter Financial Publishing (publisher of Financial Advisor and Private Wealth magazines). For more information click here.