Today I want to discuss something that’s sort of a popular topic with me for both personal and business success, and that is data. Similarly, you may think of never-ending information flow. Often I hear people saying that you can have things like: “Too much data,” or: “I don’t need any more info.” If you don’t need any more info, that’s kind of like saying: “I don’t need to learn anything new. I already know it all.” Remember the episodes on not making decisions early, that is a similar idea. You don’t make decisions early. Why? Because there always may be more and more information that’s going to come in that we need to hear and we need to listen to; it may tip the scales. I’ll explain this a little bit more again in a little while.
One of the things I used to hear a lot from some CEOs or very high-ups in any corporation is they say: “I don’t need any market research data,” or: “I don’t need any more research. I know it in my gut.” If you’ve seen the quotes, actually, there was a quote from Warren Brown, formerly the Washington Post; and Don Hilty, formerly Chief Economist for Chrysler Corporation both have said things to the fact that I’m blunt, straightforward, honest, and thorough. They liked what I said, but they didn’t always take it down easily. What does that mean? That’s exactly what I’m going to say, here, and what I have said in some things to those CEOs or general managers of major corporations.
What I would usually do, after they said they know it in their gut, I’d say: “Gee, where’d you get that gut? How did that come about? What happened?” I’d only hesitate for a moment, because I knew they didn’t know the answer and they didn’t have any real answer to it,” and I said: “We know you certainly weren’t born that way. You weren’t born as an expert in this area, so you must have acquired it over time. I wonder where you acquired it from. I guess it was from different things and experiences, right? Basically, what has happened is a lifetime of data and information has flown into you in order to form that feeling that you call your gut.” You can imagine the kind of looks I got at the time, but I tried to tip the conversation in another direction then, usually successfully. The idea was: Yes, you can always learn more.
What do you do with all of that data? Even when you have data, you have an opinion, and you have a thought, you always need to test. Test. You’ve heard of A/B testing, for you test one logo versus the other, or you test a headline versus another, an ad versus another, and you can get more extensive when you get into some higher statistical techniques. As you’re pulling in all this information and data, some people will say you have too much.
What does that really mean, “too much”? I used to get this all the time when I was first starting out in a lot of research, where somebody would say to me: “Well, you don’t want it all. How about we send it to you in groups?” By groups, they meant, for example, age groups, they might want to have 19 to 34 and 35 to 64 and 65+ or something like that. I would always say: -“Whatever you have it in, I want to see the raw stuff.” -“Well, you don’t want it by years.” I said: “If you have it by years, that’s the way I want it.”
Why would I say that? Because different things I’m looking at may have different influences. For example, the 25- to 34-year-old is really very different when you think of a 34-year-old versus a 25-year-old. These basically were the standard breakdowns that the census would break them down to, because they did aggregate them, they would have 19 to 24, 25 to 29, 30 to 34, then they would go into 10-year age groups; 35-44, etc.
What’s the significance of that? Let’s take a look at car models. A very different kind of car is bought in a person’s late 20s and early 30s than as they turn 40. When everybody was saying: “Wow, everybody’s becoming intrigued, and we’re really moving up, and there’s just going to be this continuing growth of sporty cars.” I was saying: “Nope, they’re going to start dipping in about 5 or 6 years. Why was that? Because the Baby Boom was going through their late 20s, early 30s, etc., they were about to hit and would be hitting the 40s. What happens in the 40s? Even if they want to have a sporty car, the stiffer suspension, the seats, etc., the harder ride as their backs get a little bit more sore, etc. and they’re not as flexible as they used to be – those things change.
There is an exception, as I’ve pointed out in another episode, the male menopause car, that is the Porsche, seems to hit those people in that age group where they’re sort of going through that change in life, divorces, etc., which seems to come in the late 30s, early 40s, and they also have enough money to afford a Porsche, and it looks good, and all the other things. As they’re going through that change of life, very often, would be steered towards that direction. What does that mean? Porsches will increase as the population in that age group will increase their sales during those periods, and they did.
Remember the episode on people talking about predictions, and whether you can or can’t predict the Baby Boom affects as they move through, and that’s what we’re talking about, the cars. The same goes through everything from middle schools, high schools, and colleges. All the way on in the not-too-distant future, we’re going to see and we’re already starting to see the increase in care for the elderly. Why? The Baby Boom is moving into that group.
The demographics have a lot of influence on a lot of different decisions we make. I find it funny and interesting that many people who say… Well actually, I can’t think of anybody I’ve ever heard of that even though they might say that they don’t need any more information, or they have enough data will also turn around and say that they are never-endingly learning through life. If they’re learning through life, isn’t that a contradiction, the idea that you need more data or don’t? If nothing else, the increase in data will make your decisions more certain, it will lower the variance, or will make the confidence much tighter so that your decision becomes more accurate. If it does reinforce, that’s good; if it doesn’t reinforce your existing knowledge, that means your certainty or risk of your decision is increased.
I actually wonder when a person says they don’t need any more information if they’re really listening to themselves or if they just kind of barf out of their mouth, without any explanation or forethought. Additionally, as you’re getting more data, that data is time-based, that is the data you’re getting today versus the data you got a year ago or two years ago or three years ago – those all show or are capable of showing your trend. Are tastes trending? The reason I brought up the demographics first was because you want to know why tastes are changing, because it may not be that they are really changing. Some tastes do change, but others are subject to the characteristics of the population, that is you do things differently at age 50 than you did at age 35 or 25. You require things that are different. Yes, the environment in a sense of technology, etc., changes a little bit, but those trends should be taken in in context with things such as the demographics.
What I’ve introduced and told you is that there are really a whole bunch of different variables involved; social factors, technology, changing tastes or ideas. Today people talk about positive or negative, whatever you want to think, things like global warming. Those are changing people’s directions and what they believe. We’ve also had a whole series of changing patterns in health. Things that we thought were terrible for us and we were supposed to stay away from, and they even pointed us into directions of things that we should have instead, it turns out some of those things, like margarine, etc. are actually bad for us, and we should go back to butter. That milk wasn’t so bad, matter of a fact, that’s good for us, in general, unless you have lactose intolerance, etc. Coffee, we were told to get away from coffee, it turns out the antioxidant characteristics of caffeine help us.
You want to know what’s going on by many different variables, but as the variables increase, the increase in need for data becomes increasingly important, too. You need more to cover and to account for the different ways you want to look at information or test information, and understand it. When you’re not using data, you’re flying blind. When there’s more data, you’re ignoring information and knowledge if you’re not using it. Can you have too much? No, you just have to learn how to use the right part of it, aggregated in the best way, without over-aggregating it.
The way data is gathered and where you get it from is critically important, but always think in terms of information flow that you get and can get is meant to increase your decision-making. It’s part of the learning process, just as if you went to seminars, webinars, or school. However, your data must be as good and unbiased as possible.
It’s interesting, when I was inquiring on somebody’s thoughts on this, they sent me a note or a quote, I don’t know which it is: “Data cleanliness is next to godliness.” With that, thank you very much for listening. Leave me your comments on the Life Unsettled notes page. Thank you very much. Looking forward to it.