I was reading this article written by Michael ( Thanks to Suzanne) on an interesting thought on information arbitrage. He wrote:
Arbitrage has been a widely used term in the financial world, describing the practice of taking advantages of price differences in different markets. It is all about striking a combination of matching deals that capitalize upon the imbalance.
Information arbitrage is occurring when a marketer takes advantages for his own brand over other brands due to one of three potential arbitrage situations: More Information, Better understood Information, Better used Information.More Information refers the pure fact that one marketer might had more information than the rest of the category. Better understood information refers to a marketer’s situation when his analytical horsepower and intellectual capital is just better than the rest of the industry and allows him to uncover previously hidden insights. Better used information refers to the fact when a marketer allows the whole brand organization to have easy and meaningful access to information that allows for more and better insights driven decisions than the rest of the category.
My View
I think this is a lovely thought that CMOs can use in evaluating how they are leveraging information within their company. Some organizations like Tesco, Harrahs have used information - transactional and demographic, in building lock-ins with their customers based on their behaviour. Some key questions that CMOs must ask themselves:
- Where does information lie within my organization that I need to bring together?
- Are there information leakages that I need to plug within my organization that can help me build a competitive advantage vis-a-vis competition?
- Is information available only in small pockets within the organization? How can the breakdown the walls that exist for data-driven decisions within my teams?
- Can I convert this information into action in real-time?