MasterCard may know a thing or two about what people shop for. Around 1.8 billion people use the credit card that is accepted in 34 million stores worldwide. While retailers can figure out what consumers purchase in their own store, they can’t as easily find out what people are buying in other stores. This is the kind of information that MasterCard hopes to sell this information as it launches the $5 billion big data analytics market.
Last week, the credit cards subsidiary, MasterCard Advisors, took interest in an undisclosed stake in a big data analytics company called Mu Sigma. According to Business Insider, the two will offer joint products together using MasterCard’s databases and Mu Sigma’s analytics technology.
Mu Sigma is a Chicago- and India-based company that raised around $133 million since it was founded in 2008. This amount includes $108 million in 2011 that was lead by General Atlantic. Its customers include Walmart and Microsoft.
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Gary Kearns, the MasterCard executive vice president spearheading this project, explained in a recent interview that Mastercard will aggregate information across the 34 million merchants who accept MasterCard, and create analytics, reports and insights off this rich data.
“We do not sell the actual transaction data – we sell products like benchmarking reports (how is my business performing compared to other merchants?), and analytics (how can I better understand what my customers might want to purchase?),” Kearns explained. “We would also sell this retailer weekly information about its sector – for example, women’s apparel sales each week – so that they could better benchmark their performance.”
Kearns explained that there are plenty of interesting things a company can learn from these reports.
“A large retailer was able to understand, at an aggregated and anonymous level, what its customers do before and after they shop there. This large retailer would then be able to offer its customers certain incentives to come there and spend more on the items that they may have purchased before and after visiting them,” he said.
Source: Business Insider