23 Nov 2011
The Atlantic reports on the data deluge and its value for innovation. ((I don’t know that I would call much of it ‘innovation’. There is some outright innovation, but a lot of that is in the general strategies for using the data. There is much more gained in minor tweaking and optimization of products and services.)) I particularly liked how Erik Brynjolfsson and Andrew McAfee, who wrote the Atlantic piece, highlight the value of experimentation for addressing causal questions — and that many of the questions we care about are causal. ((Perhaps they even overstate the power of simple experiments. For example, they do not mention the fact that many times the results these kinds of experiments often change over time, so that what you learned 2 months ago is no longer true.))
In writing about experimentation, they report that Hal Varian, Google’s Chief Economist, estimates that Google runs “100-200 experiments on any given day”. This struck me as incredibly low! I would have guessed more like 10,000 or maybe more like 100,000.
The trick of course is how one individuates experiments. Say Google has an automatic procedure whereby each ad has a (small) random set of users who are prevented from seeing it and are shown the next best ad instead. Is this one giant experiment? Or one experiment for each ad?
This is a bit of a silly question. ((Note that two single-factor experiments over the same population with independent random assignment can be regarded as a single experiment with two factors.))
But when most people — even statisticians and scientists — think of an experiment in this context, they think of something like Google or Amazon making a particular button bigger. (Maybe somebody thought making that button bigger would improve a particular metric.) They likely don’t think of automatically generating an experiment for every button, such that a random sample see that particular button slightly bigger. It’s these latter kinds of procedures that lead to thinking about tens of thousands of experiments.
That’s the real deluge of experiments.