Cowtown took a hit when oil prices tanked. But Calgary tech companies could hit pay dirt soon by going after resources that aren’t in the ground thanks to data mining. Like many Canadian cities, the Alberta capital has a burgeoning tech sector long overshadowed by traditional industries, but as laid-off oil workers and execs look to regroup, the city’s tech community is receiving more attention at a time when data is seen as a precious resource.
Menome Technologies sees potential for data in the post-oil era. The startup was founded by Mike Morley after he was laid off from the energy sector during the downturn. He believes data mining could replace drilling for oil as one of the city’s chief job creators, because data is the driver of the new economy. Menome helps companies deal with the data deluge—there’s no shortage of information available to businesses of all sizes across all industries, but the data is scattered across different systems that aren’t easily linked together. Morley created Menome to solve this problem.
Data mining is not new, but it’s getting more attention, as it’s no longer just the domain of larger companies, such as Netflix, Amazon, and Spotify.
Data drives streaming services
Just before Christmas, a single tweet from Netflix caused much anger and entertainment: The video streaming company called out the 53 customers who watched A Christmas Prince—a Yuletide movie it produced. It’s not just the mocking of its customers that drew ire, it was the realization that it and many other companies collect a great deal of data about its users.
Netflix responded to the furor by emphasizing the behavioural data it collects is used to better serve users—and is done so anonymously. It’s not alone: Music streaming service Spotify also got into hot water for making fun of users based on their listening habits, even though it was part of an ad campaign that sought permission from specific customers who participated. And like Netflix, Spotify collects data about users to make recommendations.
Both these incidents brought the concept of data mining to the attention of the average customer, but it’s nothing new. It involves sorting through large data sets to identify patterns and establish relationships to solve problems through analysis. The exponential volumes of data in scientific disciplines, such as bioinformatics, experimental physics, astronomy, and chemistry are helping tune various techniques that can be applied in health care, finance, insurance, retail, and telecommunications, among others.
Mining data illuminates health care trends to improve treatments and patient outcomes, helps insurance companies analyze risk, and allows businesses of many types to predict future trends, so they can plan accordingly and improve profitability. What’s changed in recent years is its pervasiveness in online services—it’s why you see a relevant ad from Amazon on Facebook right after you visit Amazon. But it’s no longer just the domain of large companies with deep pockets or university research labs with a supercomputer. Data mining has been democratized thanks to customer relationship management (CRM) tools and chatbots that engage users.
Startups, such as Menome, make it easier for companies to solve specific problems by harnessing data they’ve collected without investing in costly computer power and hard-to-find data science talent. Because it’s more accessible, it’s become an essential tool for companies looking to gain a competitive advantage.
Learn how data mining gets done
Businesses trying to figure out how to mine data should consider where it’s already heading:
- Extracting data from various multimedia sources, including audio, video, and images.
- Pulling data from mobile devices to gather information about individuals.
- Compiling large amounts of information from different organizations to gather insight and build reports.
- Grabbing information from environmental, astronomical, and geographical data for use in navigation applications, such as geographic information systems.
- Studying cyclical and seasonal trends, as well as analyzing random events happening outside the normal series of events, including customer buying patterns and behaviours.
Understand the benefits of a new resource
One reason the business of mining data is appealing—aside from the fact that businesses want to draw insight from all the data they’re collecting—is they don’t have to be in a specific place to do it. While Calgary tech companies may see it as a way to reduce dependence on oil drilling, other cities are also poised to capitalize on the data deluge.
Local companies can exploit data by helping their municipality become a smarter city, including Calgary. In 2017, the Canadian federal government doubled down on its Open by Default Portal and earmarked millions of dollars for its Smart Cities Challenge. The evolution in the open data landscape is expected to continue in 2018, as open data providers and users seek to close the gaps between what’s here already and what’s needed for Canadian innovation. The City of Edmonton, for example, has led the Open Cities Index for the last three years, so the Battle of Alberta is further incentive for Calgary to shift its economy from oil to data.
If you conduct business in Calgary, this trend is worth keeping an eye on. Knowing how to collect and leverage data now will help you stay one step ahead of competition tomorrow.