It sounds like the premise for a new sci-fi flick: an advanced species, the Quants, arrive with incredibly deep knowledge on data from a variety of sources, and can test, manipulate and model it to confirm or disprove theories, allowing a far greater understanding of what makes people (and the decisions they make) tick.
Except it’s anything but science fiction. Quants – short for quantitative analysts, are part of the innovation that powers data science. In short, a quantitative analyst looks at trends and data, or proposed models, and leverages that data to make interpretations and verify results.
Sounds deep? It is.
Until recently, most quantitative analysts found their niche in finances – helping stock traders and investors by making data-backed market predictions. Just look at the this clip from The Big Short, which chronicles the leadup to the subprime mortgage crisis:
But these “quants” have also found a surprising new home among marketing teams too – and what they have to offer can be a true game-changer. Here’s what you need to know.
Major Marketing Shifts Demand a New Kind of Scientist
Traditional marketing methods used to throw everything at the consumer in the hopes that some of it would stick. Today’s advertising demands that they be much smarter about how, where and who their ads are targeting.
Although most marketers have a pretty solid idea about who they’re marketing to, and what kinds of content they consume, having a Quant on board can also mean new tools can be developed to predict and target those audiences with greater precision and a more tailored message – the very kinds of connections that customers crave.
One of the underpinning decisions that have shifted the way advertising is handled, is how ads are bought and sold – a specialization that demands Quants chew through copious amounts of data and develop algorithms that spot purchasing opportunities across a sea of media outlets.
Even customers who have the same general interests and purchasing behaviors can vary wildly in their choice of channels through which to consume the media. A Quant, and their marketing cohorts, have to be able to predict and position themselves to take advantage of these changes as they happen.
Understanding How Ads are Bought and Placed
Savvy marketing teams know the general channels and media outlets their customers prefer – but adding Quants to the mix further narrows that laser-targeted focus, and proves it with data. No longer do advertisers have to hope that targeting an ad to a specific demographic will generally get results. With Quants on board, they can have predictive models that demonstrate precisely how the ad will perform given the data they have collected so far.
This isn’t to say, of course, that the emphasis on consumer behaviors powering marketing decisions has fallen by the wayside. If anything, it adds a new layer that magnifies those behaviors and lets marketers deep deeper to make more meaningful connections.
Marketers who forego these kinds of advertising strategies will find their brands are quickly made irrelevant or seemingly “out of touch” with what customers want. It’s a rapidly changing playing field, and advertisers who can draw definitive distinctions from the data they gather will soon be miles ahead from those who are still struggling to maintain relevance.
Benefits of Adding Quants to Your Marketing Team
Quants have seemingly limitless potential when added to marketing teams. Like the secret ingredient that truly “makes” a dish, they can develop predictive advertising models that take into account much more than a user’s location or what products they viewed.
Imagine being able to pinpoint not just a customer’s location, but what other places they tend to visit as well? Imagine being able to glean their interests from not just the social media profiles they follow, but what they post? Imagine not only being able to see current products they’ve interested in, but what they’ve bought in the past – and what they may buy in the future? How much of an impact did your current ad campaign have on them, if any?
This is the kind of data that Quants dive right into, plucking that irresistible-looking, but seemingly-out-of-reach fruit that’s ripe for the taking.
And as more traditional channels like TV, radio and newspapers begin their shift to a more programmatically advertising-backed strategy, you can expect to see the lines between these channels blur even more. The ripple effect may start with the online world, but it will eventually branch out to affect everything from how ads are bought, to how consumers shop.
Quants are traditionally hired by companies working with hedge funds, mutual funds and asset managers, as well as investment bankers. These days, it’s becoming more and more common for high level consulting companies and advertising firms to hire quants as well.
What’s the Difference Between a Quant and a Data Scientist?
When considering hiring a Quant, the question often comes up, “don’t data scientists do the same thing?” The answer is — not quite.
Data scientists know where to find data, how to analyze it and work with it in order to optimize processes and increase customer lifetime value. Data scientists can take copious amounts of convoluted, unstructured information and analyze it to pick out the gold nuggets that make an impact on companies’ bottom lines and customer retention.
Quants also analyze data, but they tend to manipulate it more to forecast potential opportunities and changes. Rather than picking out gold nuggets, quants tend to take the whole and see if they can draw conclusions from it. One specialization isn’t really replacing another or necessarily better than the other.
Also, many organizations and companies can thrive just fine with a team of data scientists — Uber, Airbnb and many others are perfect examples of this. However, if you’re in the business of gauging opportunities, making data-backed predictions and determining how to prepare for and leverage multiple outcomes, having a quant in your corner could make all the difference.
Where Can I Find Quants?
Quants typically hang out in places with large financial sectors — New York, Chicago and even Boston are some of most common locales, but they can be found across the country and around the world. Firms looking to hire quants will look for, at the very minimum, a master’s degree, but they prefer a PhD in a quantitative-related subject like mathematics, finance, statistics or economics. University towns with well-known and respected programs in these fields are also a hotbed for Quant talent.
Are There Any Drawbacks to Hiring a Quant?
Quants are in their element when it comes to data and statistics. But you can’t forget the marketing aspect, either. Quants are typically proficient at identifying patterns and trends, and then creating and implementing campaigns while measuring and verifying the results accordingly.
However, it’s also temptingly easy for them to question everything. While it’s in their nature to want to question things, and use data to uncover answers, as they dig deeper and deeper, they end up with even more questions. It becomes easier to overlook things. When the success or failure of an ad campaign hinges on their ability to accurately predict and model the outcome, there’s also a degree of stress involved.
It’s also possible for Quants to become too confident. With so much data and so much analysis going on, it’s important for them to stay grounded and collaborate with other team members to understand the big picture and the end goal.
Quants aren’t for every company. Small to medium-sized businesses without much of a focus on advertising won’t see much benefit from hiring them. Industries where Quants excel naturally have a great deal to do with math, statistics and programming, including modeling various outcomes.
How Will Quants Change the Industry?
Quants’ place in marketing is still relatively new. Tools that leverage the predictive modeling capabilities of big data and apply it to programmatic advertising are still fairly novel, and there is no “one size fits all” solution for every enterprise.
However, by using a customer behavior analysis tool like Kissmetrics, you can not only gather the kinds of impactful data that help Quants identify and act on trends and behaviors, but you can also deliver it visually – knowing precisely what events trigger opportunities, and capitalize on them at a moment’s notice.
And those are the kinds of opportunities that – Quant or not – everyone can get involved with.
Do you have Quants on your marketing team? How have their strategies and findings impacted your advertising and your bottom line? Share your thoughts and perspectives with us in the comments below!
About the Author: Sherice Jacob helps business owners improve website design and increase conversion rates through compelling copywriting, user-friendly design and smart analytics analysis. Learn more at iElectrify.com and download your free web copy tune-up and conversion checklist today!
from The Kissmetrics Marketing Blog https://blog.kissmetrics.com/rise-of-the-quant/