Intuit 2020 Report: The New Data Democracy


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Intuit 2020 Report: The New Data Democracy

  1. 1. Intuit 2020 Report The New Data Democracy: How Big Data Will Revolutionize the Lives of Small Businesses and ConsumersThe new data democracy The growth of the Internet, wireless networks, smartphones, social As part of the broader Intuit media, sensors and other digital technology is fueling a data revolution. 2020 series, Intuit and This revolution is based on the new science of “big data” – where large Emergent Research sets of information can be gathered, stored, analyzed and shared. Over About have collaboratedthe report the next decade, analysts expect the global volume of digital data to on a research and forecast project on the increase more than 40-fold. democratization of data with a focus on implications Previously the exclusive domain of statisticians, large corporations andfor consumers and small businesses. information technology departments, the emerging availability of dataThis report highlights emerging trends ofthis complex world of data and maps out and analytics – call it a new democratization – gives small businesseshow they will affect small business and and consumers greater access to cost-effective, sophisticated, data-consumers over the next seven years. powered tools and analytical systems. This new data democracy willFor more information please visit: deliver meaningful insights on markets, competition and bottom-line or business results for small businesses, as well as shape many of thecontact decisions we face as individuals and families. The growing access to this massive volume of information – and the ability to refine and analyze it – makes it a new type of raw material, Data Points on par with capital and labor. Advanced analytics will move from the 30 The amount of data that will be stored in the world by 2020. domain of specialists to everyday users. Data will be a key driver of zettabytes One zettabyte is the equivalent of streaming global economic growth in the 21st century digital economy, with a 36 million years of HDTV video Source: IDC profound effect on all aspects of society – business, science, health 10 terabytes The amount of data Facebook generates daily. care, finance, government and entertainment. For small businesses and consumers, the big data revolution promises 7 terabytes The amount of data Twitter generates daily. One terabyte would hold about 250,000 songs, a wide range of benefits. Big data will improve our communities, help or nearly a year’s worth of continuous music us make better decisions and create a wide range of new business Source: IBM opportunities. This revolution will also challenge businesses, individuals 40 percent The annual growth rate of global data generated per year. and governments to develop new privacy and security frameworks to ensure the trusted use of data. Source: McKinsey 10 The number of mobile- connected computing devices in billion+ use by 2016, up from less than 7 billion in 2012. Source: Cisco Intuit 2020 Report DECEMBER 2012 ©2012 Intuit. All rights reserved.
  2. 2. DATA Empowers Consumers D i gi t a l D a ta H elp s I n d iv id u als Nav ig ate the Ma z e o f Mod ern Life Digital data will transform how people live and behave in a variety of new and meaningful ways. Connected through the global grid and mobile devices, data will shape how individuals make decisions both large and small, determine purchasing decisions and form communities and relationships. A New Era of Data-Driven Decision Making As life becomes increasingly complex, digital data will simplify decision making. Economic changes over the last few decades have shifted many risk management responsibilities from institutions to individuals, a trend likely to continue. In addition to this increase in personal responsibility, insurance, health care, retirement and other financial issues are growing evermore intricate, increasing the number of difficult decisions we all make. Data-driven solutions will come to the rescue, helping simplify, and even make, these decisions. Over the next five to seven years, emerging technologies and new analytical tools will convert daunting data streams into actionable information that will ease personal decision making, reduce uncertainty and save individuals both time and money. These analytical tools will store, organize and analyze life’s data feeds for us, aggregating anonymous information from large numbers of people to provide individuals with personalized comparisons and insights. Used on their own or in conjunction with advisors such as accountants, financial planners and health specialists, these data-driven tools will demystify the complexity associated with the business of life. By 2020, individuals will routinely turn to data-driven analytical tools to help solve many of life’s most important decisions. Early indicators of this trend include: • Financial Engines, which helps hundreds of thousands of people navigate the complexities of retirement planning. Founded by Nobel prize-winning economist Bill Sharpe, the firm provides individuals with sophisticated financial advice – previously available only to the world’s largest institutional investors. Its foundation is cloud technologies, new ways to access large financial data sets and advanced data analysis tools.the new data democracy 2
  3. 3. • Exmobaby, which creates baby pajamas with built-in biosensors that collect a wide range of health and wellness data. In addition to providing real-time bio-stats on the baby, such as heart rate and physical activity, Exmobaby hopes to aggregate this information into large databases on infant health and wellness. Parents will use these products to monitor the health of their babies, track their growth and compare their progress to trends for other infants. • Parchment, a startup that helps high school students choose and apply to college. By analyzing a large database of student profiles such as grade point averages, SAT scores and acceptance data, Parchment assesses a student’s likelihood of admission to a specific school. It then determines what the student must do to improve acceptance chances. Parchment also plays matchmaker, pointing students toward schools that match their profiles, helping them find a good fit. Power Shifts to the Data-driven Customer Data-rich platforms are making online business reviews commonplace and powering smartphone applications that evaluate and compare products and service prices in real time. This will give data-empowered customers ever-greater access to pricing information, service records and specifics on business behavior and performance. Data delivered through Internet and mobile technologies will create a new market transparency that radically alters how business is done. This new era of hypertransparency will change the way people shop, allowing individuals to save time and money, and tipping the power dynamic to favor the buyer over the seller. People will gain deeper insights into what and who they are buying from and, with the helping hand of data, acquire the power to command a fair price. Businesses that operate with integrity and values will reap the rewards of this new transparency as more and more consumers base purchasing decisions not just on price, but also with an eye on a company’s social reputation. Firms that are authentic, meet their commitments, provide excellent customer service and strive to create long-term value for their customers are most likely to survive and thrive.Intuit 2020 Report 3
  4. 4. By 2020, hypertransparency will be the norm with smartphone-based price checkers and reviews fully integrated into online social applications. Early indicators of this trend include: • Turbocharged competition, where consumers use increased access to real-time pricing information and the opinions and experience of others to find better deals. Google Places, for example, tightly integrates Google’s mobile search and maps with reviews, giving smartphone-wielding consumers detailed information on local businesses anytime, anyplace. • Social shopping, where consumers’ friends and others use technology to become involved in the shopping experience. For example, the e-commerce site integrates with Facebook to create a real-time text-and-photo stream of what friends are buying, sharing and liking. This means that bad experiences will quickly ripple through groups of friends, while good experiences will drive others to buy. • Value-influenced decisions, where consumers use access to detailed data on issues they care about when making purchasing decisions. In response, companies are starting to make this data readily available. Eco-labels on General Motors’ 2012 Chevy Sonic, for example, disclose how much energy and resources it takes to build the car, the pollution generated during production and what happens to the car at end-of-life. A third party certifies the data to assure environmentally oriented consumers that GM is serious and transparent about sustainability. Consumers Delegate Tasks to Digital Concierges Data-driven smart applications will perform many tasks, with a growing number doing the work for us. Big data is driving a revolution in machine learning and automation. This will create a wealth of new smart applications and devices that can anticipate our needs. In addition to responding to requests, these smart applications will proactively offer information and advice based on detailed knowledge of our situation, interests and opinions. This convergence of data and automation will simultaneously drive a rise of user-friendly analytic tools that help make sense of the information and create new levels of ease and empowerment for everything from data entry to decision making. Our tools will become our data interpreters, business advisors and life coaches, making us smarter and more fluent in all subjects of life.Intuit 2020 Report 4
  5. 5. By 2020, data-driven smart applications and devices will extend and augment the capabilities of humans, often doing the work for us. Early indicators of this trend include: • Apple’s Siri, a first-generation, digital personal assistant that mines the Web to respond to user requests and assist in accomplishing simple tasks. Siri’s machine-learning software builds upon the requests from millions of users to become smarter every day. Future generations will move beyond just responding to requests to proactively providing advice. • IBM’s “Watson in your pocket,” which builds upon the big data-driven machine that became the “Jeopardy” champion by harnessing and analyzing massive amounts of data in real-time. Consumers will likely initially see Watson in health care, where it will answer questions on symptoms, prescriptions and other medical issues. But the use of Watson will spread to provide real-time advice on a wide array of daily life issues. • Wolfram Alpha, an online personal analytics tool that helps people analyze their Facebook feeds and displays their account activity in pie charts, graphs and maps. In the near future, Wolfram Alpha will expand its personal analytics tools to allow users to input and analyze a wide range of personal data including emails, instant messages, tweets and health data. • Google’s Field Trip, a customizable local discovery engine that runs in the background on your smartphone. When people approach something interesting, it automatically informs them about the location. No click is required and it can even read the information to them. Field Trip bases its recommendations on user inputs and lets users find the cool, hidden and unique things and places wherever they are.Intuit 2020 Report 5
  6. 6. Data Fosters Community Around the globe, digital data will turbocharge the rebirth of the village and reconnect people to their communities in new ways. In simpler times, people lived in villages where everyone knew each other. Life centered around the local community; neighbors knew and helped each other, and civic participation was near universal. The pace, stresses and pressures of modern life changed this, isolating many of us from our communities and leaving many yearning for the comfort and connection of belonging to a place. Digital data will recreate the familiarity of the village. Online location-based services, local search and new data-driven discovery applications will lead people to more deeply explore their neighborhoods. Social media will offer new ways to meet and interact with neighbors as hyperlocal media powers a new wave of civic engagement. Privacy: Being Good Isn’t Enough Companies that develop comprehensive and clearly communicated privacy practices will thrive, as strong data privacy and security become part of the value that successful businesses will offer their customers. As personal data increasingly migrates to the cloud, businesses will develop new and more secure ways to protect this data and thereby earn the trust of their customers. The new era of big data will spur the updating and modernizing of today’s current privacy frameworks. Successful businesses will clearly communicate to customers how their data may be used, their options for using and sharing that information and the benefits they can expect from its use. Industry and regulators will also have to work together to establish clear, consistent outcome based privacy policies that help empower consumers and fuel data-driven innovation. By 2020, responsible data stewardship will be required of both businesses and individuals. Early indicators of this trend include: • The Personal Data Ecosystem Consortium, an association of companies working to empower people to collect, curate and derive value from their personal data. Consisting mostly of startups, association members are developing tools and systems that provide new controls over personal data. • BillGuard, a personal finance security service, which enables consumers to monitor their bills by collecting information on fraudulent credit card transactions using the power of many. When the system suspects a fraudulent or questionable charge, it alerts the consumer to take action. • Privacy by Design, an initiative by the Ontario, Canada Information and Privacy Commission. Supported by U.S. and European policy leaders, it encourages businesses to implement privacy and data safeguards into their technology and processes. Organizations from around the globe are adopting their principles-based approach of addressing privacy and security concerns when designing and developing technology.Intuit 2020 Report 6
  7. 7. By 2020, the use of big data to support, improve and enhance our neighborhoods and communities will be commonplace. Early indicators of this trend include: • Walkscore, a startup that uses data and analytics to help prospective and current residents reduce commute times. It also lets them find communities that fit their personalities and lifestyles, empowering people to discover the fabric of a community. • Crime prediction, helping police across the country use data and predictive analytics to help forecast, disrupt and prevent crime instead of simply reacting to it. The Memphis Blue CRUSH (Criminal Reduction Utilizing Statistical History) program, for example, contributed to a 28 percent reduction in serious crime, substantially increasing neighborhood safety. • Match Puppy, an online service that connects dog owners to one another to encourage doggie play dates. This is one example of online social tools that introduce neighbors to one another based on interests, and increases local community ties. • Adopt-a-Hydrant, an online program in Boston that allows residents to be responsible for digging out snow-covered hydrants near their homes. Developed by the nonprofit Code for America, it coordinates community involvement on a digital map. This large database of individual civic action improves neighborhood fire safety and the efficiency of Boston’s under-resourced fire department.Intuit 2020 Report 7
  8. 8. Data Drives Main Street Digital N e w R u le s fo r B ein g Smart in Small B u sin ess Big data is changing the rules of commerce and business operations, creating opportunities and challenges for small businesses. The convergence of three interrelated computing trends – cloud, mobile and social – will create cost-effective, data-rich platforms on which to build new businesses and drive economic growth for small and large businesses alike, helping increase local economies as well as global e-commerce and trade. Digital data will turbocharge the use of analytics, in both small and large businesses. Proprietary data combined with data from the cloud will create new insights and a deeper understanding of what consumers need, what they like and what will keep them happy. The development of new data sources and unique analytics will drive entrepreneurial growth around the globe over the coming decade. Data Brings Back Personal Service Digital data will give merchants the ability to provide customized goods and services tailored to the specific needs of individual customers – just as local merchants used to do – only better. Local shopkeepers once knew what their customers liked, right down to color, size and taste. The rise of modern commerce, malls and big box retail changed this. Economic efficiencies flourished as did more choices and lower prices, but at the cost of personalized service. Merchant access to digital data is bringing back personalized service with a new dimension: Businesses can often anticipate and meet customer needs without so much as a conversation. Customers leave digital footprints when using the Internet, a credit card or posting on Facebook. These digital footprints reveal individual purchase patterns, lifestyles and interests – the same information that the traditional shopkeeper once gathered by personal contact. With our permission, local merchants will use this information to reacquaint themselves with us as customers and deliver the customized goods and services we want.the new data democracy 8
  9. 9. By 2020, the personalization and localization of goods and services will be a regular part of everyday life. Early indicators of this trend include: • Startups, such as Scout Mob and Womply, which allow local merchants to personalize offerings for particular consumers, increasing customer loyalty. These services let local merchants combine information on purchases with social media data to provide a more complete picture of customer preferences. • ValuText, a mobile marketing service, which sends special offers to the smartphones of shoppers who have opted-in when they enter a “geo-fence,” a predefined, virtual space surrounding a merchant. These offers can be customized to specific customers using profiles maintained by the merchant. • Several global hotel chains are exploring applications that, with guests’ permission, recognize them via their cell phones when they pull into the parking lot. These apps let hotels automatically check in guests and have their room key and paperwork – and perhaps their favorite beverage – waiting at the front desk before they even walk through the door. Data Levels the Playing Field Big data will arm small businesses with insights and capabilities once only available to corporate giants, empowering entrepreneurs with new ways to operate more efficiently, find new customers and, most important, improve their top- and bottom-line results. These new capabilities enable small businesses to be significant contributors to the 21st century digital economy and will be driven by inexpensive yet powerful cloud-based data and analytical tools that let small firms better organize, manage and analyze their businesses. Small businesses will also gain from combining and comparing their own data with that of their peers, competitors and others. Using the power of many – the cloud-based aggregation of anonymous data from large numbers of comparable small businesses – small businesses will be able to identify and incorporate best practices, discover opportunities to cut costs, refine their business models and improve operations.Intuit 2020 Report 9
  10. 10. By 2020, small businesses will have fully embraced cloud-based data and analytical tools, using them to participate in and drive growth in the global digital economy. Early indicators of this trend include: • Datamart startup Factual, which offers a cloud-accessible database of 58 million businesses and places of interest in 50 countries, effectively creating an uber Yellow Pages with a truly global reach. Businesses will be able to use this data to identify, target and market to business customers anywhere in the world as easily as to those in their home towns. • Amazon Web Services, which offers cloud-based services that make it easy and cost effective for small businesses and startups to process and extract information from large volumes of data. Customers pay only for the cloud resources used and can easily increase or decrease their usage as required. Small businesses that use this service can complete tasks once limited to large corporations, such as mapping genomes, analyzing complex Web logs and developing sophisticated models of financial markets. • Startup Compass, which collects data from tens of thousands of startups and creates best practice information, benchmarks and performance indicators that help entrepreneurs make better decisions. This new, cloud-based service currently has 17,000 companies submitting data and using it to help run their businesses. • QuickBooks Online, which includes a Trends feature that anonymously aggregates customer data and allows small businesses to see how their income and expenses stack up against similar businesses. For example, a roofer in Philadelphia grossing $250,000 annually can compare results with other roofers in the area or across the country.Intuit 2020 Report 10
  11. 11. Big Data Creates Big Opportunities The data and analytics revolution is sparking an explosion of opportunities as both startups and existing small businesses find innovative ways to harness the power of the growing streams of digital data. The past decade’s most successful Internet startups illustrate how data and analytics are creating new business opportunities. From Amazon to Zappos, emerging high-profile companies build their business and serve customers using data and analytics. And that’s just the beginning. The large and lucrative opportunities generated by capturing, organizing and analyzing digital data are driving the formation of thousands of new companies. The opportunities being created by the power of data and analytics are not limited to tech startups. Existing small businesses across a wide range of industries are using digital data and analytical tools to extend existing products and services as well as to create new ones. As the data economy matures, small businesses will become more facile working with data, leading to even greater product and service innovation. Data Means Little if it Can’t be Understood Historically, we needed statisticians, mathematicians and data scientists to translate raw sets of data into useful information. A new wave of powerful yet low-cost, cloud-based tools will help novices and the mathematically challenged to analyze and interpret data through visually rich interactive maps, charts, infographics, movies, holographs and other depictive methods. These tools will democratize the use of data, moving advanced analytics from the domain of specialists to everyday users. User-oriented tools, often delivered as specialized tablet applications, will enable nonspecialists to query databases, conduct “what if” analyses and discover new information. These apps will be fed by cloud-based data and analytical systems developed by data scientists, mathematicians and other technical specialists. Everyday users will be shielded from the complexities of advanced statistics and math, while still being able to conduct powerful analyses.Intuit 2020 Report 11
  12. 12. By 2020, data will be a key driver of economic growth in the United States and across the globe, with data and information becoming important components of many goods and services. Early indicators of this trend include: • Venture capital firms, which are expected to increase their investments in big data by nearly $5 billion in 2012, more than doubling the $2.47 billion committed in 2011, according to Thomson Reuters. This is up from $1.53 billion in 2010 and $1.1 billion in 2009. • Irish startup Treemetrics, which created the world’s largest international forestry analytics database with more than 11 million trees. Known in their industry as the Google of forestry, Treemetrics is improving forest sustainability and increasing lumber yields by creating data and tools that optimize harvests while reducing waste. • Small businesses, which are increasingly tapping the big data power of Google Earth and other online big data sets to find new customers, provide value-added services and improve operations. EagleView Technologies, for example, was founded in 2008 and provides roofers and solar panel installers with precise measurements of roof sizes and slopes based on aerial photographs. Local contractors use the images and measurements to inspect roofs, estimate costs and identify potential customers without the need for costly site visits. •, which sells new and used golf equipment through, in a partnership with eBay and the Professional Golf Association. This database provides consumers and retailers with access to up-to-the-minute trade-in and resale values for used golf clubs and expanded the market by making it easier to buy and sell used equipment. The company expanded the market through increased sales.Intuit 2020 Report 12
  13. 13. Putting Data-driven Smart Applications to Work Business will see intelligent devices, machines and robots taking over many repetitive, mundane and dangerous activities. Monitoring and providing real-time information about assets, operations and employees and customers, these smart machines will extend and augment human capabilities. Computing power will increase as costs decrease. Sensors will monitor, forecast and report on environments; smart machines will develop, share and refine new data into knowledge based on their repetitive tasks. Real-time, dynamic, analytics-based insights will help businesses large and small provide unique services to their customers on the fly. Both sources will transmit these rich streams of data as new information to the cloud. Machine- learned know-how – as well as new analytics apps – will augment and ease human decision making – and even replace humans in a growing array of tasks. For small business owners and entrepreneurs, this means less time on data collection and interpretation and more time on decision making and strategic management. By 2020, data-driven smart applications and devices will extend and augment the capabilities of humans, often doing the work for us. Early indicators of this trend include: • Liquid Robotics, which operates a fleet of wave-propelled, solar-powered ocean robots designed to capture a wide variety of information on the open seas. The wave-propelled robots are much cheaper to operate and gather more data than traditional methods of ocean monitoring, greatly expanding the opportunities for commercial and academic ocean research. • SenseAware, from Federal Express, a sensor pod that can be attached to packages. It provides a shipment’s exact location, precise package temperature and information on whether a package has been opened or exposed to light. It reports in real-time via the Internet and replaces the need for human monitoring of packages. • oDesk, an online talent marketplace that uses predictive analysis to better match employers with freelancers. Drawing on a database of successfully completed tasks, this tool simplifies the task of evaluating and selecting part-time or contract workers and increases project success rates.the new data democracy 13
  14. 14. Conclusion Big data is changing the way companies conduct business, from streamlining operations and increasing efficiencies to boosting productivity and improving decision making. Big data is also being used to better target customers, personalize goods and services and build stronger relationships with customers, suppliers and employees. Data is also playing a growing and vital role in countless facets of our everyday lives. Government uses data and analytics to improve public safety and reduce crime. Medical practitioners use it to better diagnose and treat disease. Individuals are tapping into online data and analytical tools to help with everything from planning their retirement, to picking places to live, to finding the quickest way to get to work. Despite being relatively new, big data has already become a major industry, spawning new businesses and transforming existing firms. It’s also changed how society functions, how we interact with one another in our daily lives, and how businesses small and large grow and thrive in the 21st century.Intuit 2020 Report 14