Predicting the Future of Marketing
Data and A.I. will only take you so far, says Citi’s Murli Buluswar, ’01. The future of business belongs to practical and well-rounded innovators.
Predicting the Future of Marketing
A Data-Driven Legacy
Peter Rossi, MBA ’80, PhD ’84, looks back at the history of the Kilts Center and its impact on the future of data-driven marketing.
- By
- May 26, 2020
- Marketing
In the early 1990s, Chicago Booth was known primarily as a finance school. But Peter Rossi, MBA ’80, PhD ’84, a Booth professor at the time, wanted to change that. Rossi became the first faculty director of the James M. Kilts Center for Marketing. He shares here his reflections on the center’s founding, as well as how its radical approach to data has made it a leader in marketing education today.
Booth was the first place to recognize that quantitative marketing was the future of business. It was thanks to James M. Kilts, ’74, a pioneer in his insistence on hard data, that we were able to take the chance we did at Booth. We made a bet that quantitative marketing was the harbinger of the future, and we were correct—it was, even to a greater extent than I had ever thought it would be.
Business education is about the future. It’s not about what you will do the first year of your job; it’s about the frameworks and approaches that will help you tackle new issues years down the line. I assumed, and was right, that the kinds of research I was doing when we created the Kilts Center would be relevant to my students. Perhaps not that day, but in the future. I created a course called Data-Driven Marketing to provide MBA students with tools and statistical methods, and to expose them to data.
That class and that mind-set continues at Booth today. One of the Kilts Center’s singular and most important accomplishments was to become a source of data for the field of quantitative marketing. We wanted to lift up Booth and make ourselves better researchers, but we also wanted to make the data available at a small cost in order to improve the entire field by expanding quality research.
“Business education is about the future. It’s not about what you will do the first year of your job; it’s about the frameworks and approaches that will help you tackle new issues years down the line.”
— Peter Rossi
But making the data accessible was a massive task. James Kilts was instrumental in bringing Nielsen data to the center, but it wasn’t easily usable by academics. Typically in the industry, data is deemed irrelevant after a few years and thrown out. But some of the most fundamental questions in marketing research can only be studied or measured using long-term data, such as: What is a brand? What are the long-term effects of advertising? Arthur Middlebrooks, ’88, [clinical professor of marketing and executive director of then Kilts Center] was the first executive director of the Kilts Center, and he took on this monumental task. Booth professors Jean-Pierre Dubé, Günter Hitsch, and Sanjog Misra continue this tradition both in the classroom and in their research.
Art Middlebrooks was instrumental in working through the difficult details of how that data would be conveyed, stored, and shared. What we did is establish longitudinal, or panel, datasets, which gather observations of stores and consumers over long periods of time. The center receives regular updates from Nielsen on this data, and the current panel is more than 15 years long—the longest panel available to anyone in the world.
Today, the amount of information available on every individual consumer is at an unprecedented level, but as a result, an increasingly sophisticated approach to measuring impact is important for the future of marketing. Someone can take a sponsored search ad on Google and track who clicks on it—unprecedented data in terms of its specificity, level of detail, and accuracy. But there remain challenging questions. If that person didn’t see the ad, would they have bought the product anyway? It’s entirely possible. This presents a fundamental problem of statistical inference, in which data can only provide part of the solution.
If you want to have a career in marketing today, you need a skill set that includes quantitative methods, but you also have to know what questions to ask—how to best approach and analyze such huge amounts of data. There is now internal industry expertise at a level we’ve never had before, especially at companies such as Google or Amazon, as well as a high level of sophistication on the academic side. It’s a fundamentally viable career for which the ante, in terms of skill set, has been raised dramatically.
Rossi is the James A. Collins Chair in Management and Distinguished Professor of Marketing, Economics, and Statistics at the University of California at Los Angeles Anderson School of Management.
Narrator: For 20 years, the James M. Kilts Center for Marketing has been supporting thought leadership in marketing within a world-class community of research, faculty, students, alumni, and corporate partners.
James M. Kilts: “The Kilts Center is quite simply a center of excellence that helps support our faculty, our students, and programs to help make the marketing experience at Chicago Booth the best marketing experience in the world.”
Text on screen: 20 Years of Impact
The Kilts Center has …
… provided Nielsen data to 1700+ faculty and PhD students
around the globe, fostering research breakthroughs.
… supported more than
200 MBA and PhD students with scholarships.
... collaborated with a broad range of student-led groups, from marketing to technology to analytics plus innovation and design to build awareness for the importance of marketing skills across all industries.
Peter E. Rossi: “Booth was the first place to really recognize that quantitative marketing was really the future of business in many ways.”
Narrator: The Kilts Center is at the heart of Booth’s multi-disciplinary, data-driven approach to marketing. After all, quantitative marketing has been thriving at Booth since the 1950s. Today, Chicago Booth remains a marketing powerhouse—strengthened by two decades of support from the Kilts Center.
Jean-Pierre Dubé: “The Kilts Center has played a really instrumental role for faculty research both internally at Booth, externally at the University of Chicago, and more recently on a global scale by providing an unprecedented set of marketing databases that have been used at hundreds of institutions.
Text on screen: 400+ working papers made possible by datasets housed by the Kilts Center. Supporting innovation in the curriculum, the center has worked with nearly 200 companies, ranging from Google to Kraft Heinz to Humana to bring real-world business problems to the classroom.
The center has brought to campus hundreds of senior-level alumni and industry leaders who have contributed to and benefited from Booth’s social and intellectual capital.
Narrator: Two decades of powering cutting edge research and a thriving marketing community. The engine of the Chicago Approach to marketing…the Kilts Center at Chicago Booth.
Recommendations
Get to Know a Behavioral Economist: Q&A with Professor Alex Imas
In a tweet chat with Chicago Booth, Professor Imas illuminated key findings from his research on investor bias.
Get to Know a Behavioral Economist: Q&A with Professor Alex Imas
COVID-19 Thought Leadership Digest: September 16
Several professors share new research on voter participation and social distancing, the pandemic's impact on travel patterns, and more.
COVID-19 Thought Leadership Digest: September 16
Booth News & Events to Your Inbox
Stay informed with Booth's newsletter, event notifications, and regular updates featuring faculty research and stories of leadership and impact.
YOUR PRIVACY
We want to demonstrate our commitment to your privacy. Please review Chicago Booth's privacy notice, which provides information explaining how and why we collect particular information when you visit our website.