The predictive power of big data analytics (part 2)
We recently covered how companies are using big data analytics to do more than just illuminate the past. They’re using it to help predict specific aspects about the future. This shouldn’t be a surprise as we encounter applications of predictive big data analytics every day, just think of Pandora’s or Netflix‘s recommendation engines.
As a company with access to the largest and most extensive consumer behavioral data, including sales information going all the way back to the beginning of 2014, Jumpshot has the ability to make accurate predictions about revenue.
We recently proved this ability by rolling our clickstream data and sales information into regression models designed to predict the top-line revenue for six public companies prior to their quarterly earnings calls. Our data correctly predicted that a company would outperform, underperform or report inline against analyst revenue expectations.
Jumpshot successfully predicted Amazon’s Q2 2016 top-line revenue would outperform analysts’ expectations, because it was higher than the highest analyst prediction. Amazon did indeed outperform expectations and as a result its stock went up 2.1 percent in after hours trading.
Another example was for Netflix’s Q2 2016 top-line revenue. Analyst predictions ranged from a low of $2.070B in revenue to a high of $2.170B. Jumpshot estimated $2.147B in revenue for Netflix, indicating that the company would perform inline with expectations. The actual revenue for Netflix came in at $2.105B, which was a mere 2 percent difference from Jumpshot’s prediction. Once again, clickstream analysis accurately predicted future outcomes.
We anticipate making additional accurate revenue predictions prior to Q3 earnings calls, so be sure to follow Jumpshot’s CEO, Deren Baker, on Medium or check back here for our updated big data predictions.
Bottom Line: Big data analytics can help companies understand the past and present, as well as predict the future for companies, markets, and industries. Jumpshot’s behavioral data, fueled by the online actions of the largest global consumer panel in the industry, can help you understand where you stand and where you are going. We will continue to analyze our data sets and provide you with big data insights, and predictions so stay tuned!