So let's finish now with the last section of the course, and with this we will conclude not only the
second third of the course around big data, but also the full lecture's theoretical lecture.
So to finish, let's discuss about how luxury players actually use the data to transform it into a superior
expenses.
Because here what we have been looking at so far is, you know, the exponential growth of data, the
technical aspect of data collection and data analysis and so on.
But, you know, using data is more a matter of the right having the right processes than having the
right technology.
So when it comes to luxury, it's very specific because for luxury, you know, everything is based
on on on some some aspect that cannot be easily quantified, because when we talk about luxury experiences,
we talk about intangible emotional expenses and something that is pretty exclusive.
And all those words, you know, are not going well with data that need something very rational and,
you know, which needs also a huge amount of data to actually make sense of it.
And at the same time, you know, you have on the other side big data, which is all about having transparency,
using technology and manipulating mass information.
So how do luxury player use data in order to transform it into a super experience?
Well, then they combine actually both the luxury principle and the Peter Principle to do what we call
like the smart data and small details where you use the data.
But at the same time, you never forget about the context that is going with the data, because, again,
luxury experiences go with the context, you know, like enter into a luxury store.
Obviously, the way the act of purchasing a product of a luxury store is not the same at all as going
to the supermarket and buying food.
Right.
You need to take into account the context.
Also, you need to take into account the individual perception and experience.
So basically how each individual is perceiving the particular experience of buying the product, that
means that we need to combine, you know, the outcome data of everything that you collect with more
qualitative and experiential interpretation of all this data that you collect.
So the process that luxury players are using can be seen into three main different steps.
Right.
So first of all, they don't start with the data right away.
They don't like put all the data on any kind of analysis.
And so what is happening after that?
Not that's not how they work.
First, they try to start with the phase that we call the idea generation.
And here they really try to understand why people are behaving like this and why people would behave
like this.
And they try to understand also the motivations that are behind the people.
And here the tools that they're going to use is basically their brain, because what they are going
to do is they are going to craft some hypothesis by using their detection capabilities or induction
capabilities.
Detection capabilities is you start with the theory people will prefer to have, like, I don't know,
like a dedicated sales guy in a store.
And then you build a hypothesis once you have your.
But this is you observe in the real life, is it confirming.
Yes.
Or natural processes.
And that's where you have the insight.
The inspection process is the same, but you start from the observation.
So you don't have like any kind of prejudices.
You go into a luxury store, you look at how people are behaving and how people are purchasing products
and you're trying to find some patterns.
And from those patterns, you build an hypothesis that then solidified with the future.
So that's how you start.
Actually, you don't start with the data in luxury.
You start with this idea generation process.
Then when you have your clear theory, empathises that's where you are going to use the data and you
are going to use it by using what we call the design thinking method, where here you start with the
data that you have together on the field, that you have observed the quantitative data and you try
to define exactly what's happening, find what the right solution that you can propose to better satisfy
the consumers.
Try to.
Prototype a solution and test it on the field and then, you know, the first stage is when you try
to build innovation or scale, actually the solution, and that's where you're going to try to launch
creative projects and leverage machine learning capabilities, for instance, to try to understand if
you implement this new thing, you know, in your luxury company, what kind of performance is you can
expect from it.
So here that's how, you know, like data and qualitative information that is gathered on the field
that relates to the context to the individual experience of each consumer are marrying, let's say,
together.
So let's give you an example in the hospitality industry, actually.
So let's talk about the Dorchester Group, who, you know, owns a ton of luxury palaces and hotels.
And this is a case study which is pretty interesting on how they have combined and approached, you
know, like this usage of data.
The initial question that the group had at the beginning is where could we improve our business to differentiate
better from the other luxury hotels?
So that was the business programatic at the beginning.
And what they did is that they they they combined a ton of different data, data sources.
So they had data coming from mystery shoppers that gave reporting on what was good, what was that?
But they also took, like all the online reviews, they could find all the blog articles about luxury
hospitality, social media mentioned about their hotel, but also the author of the competitors and
all the rating agency that they could find.
So they they captured if you want all this data and they put it together, then that leverage machine
learning to try to find some commonalities, some patterns in this data.
And they came up with two very interesting insights.
The first one was that one third of all the user generated content on the Internet about their authors
were mentioning the breakfast.
Right.
And this was a pretty good insight because at the beginning, you know, that breakfast is a kind of
mandatory service that you need to provide as a model.
And the group, the Dorchester Group, did not realize before that their breakfast were pretty amazing
in comparison with the competition.
And by doing this analysis, they realized that it was a clear, unique differentiating point for their
hotels and they decided to expand and promote even more the breakfast that they provide in order to
increase the difference.
So now in their own website, in the leaflet, et cetera, they put more emphasis now on the breakfast
experience of their guests.
The thing on the inside that they gather the food is data analysis is that the majority of all the guests
spoke about all the hotels, outdoor spaces.
And again, you know, the not that you were like outdoor space.
And you don't think right away that can be, you know, a strong differentiator, especially when you
provide the same kind of services like swimming pools, bars and so on, to say my competition and also
provide the same.
Yes, but here the analysis shows that the hotels had the strict guidelines.
That experience provided a superior experience when it comes to how outdoor spaces.
So as a decision, they decided to show way more photos of all the outdoor spaces on the website, but
also on social media and so on.
This had the goal, obviously, to generate more favorability for the hotels than the competition.
So you see here through this case study how actually, you know, luxury players use the data they don't
like, blindly trust everything that they can find on the data.
They just, you know, like don't make only quantitative analysis and make business decision.
According to this, not they try to mix between the qualitative data and observation that they make
with the quantitative data that they gather and they try to do it, to do it and to take action on those
analysis in a way that is highly, highly quantitative.
We remain like, again, luxury brands.
We are not like selling toilet paper.
Right.
So it is a part of the experience and what we are sitting that is still super quantitative.
Intangible and super subjective to each of the people.
So luxury players cannot rely at 100 percent of the on the quantitative data that they collect, they
must always combine this with the qualitative observation and the unique experience that they want to
provide.