E-commerce grows. It grows rapidly creating tonnes of data. Without processing, this data is useless. But after you've tamed it, you get priceless insights and understanding of all processes in the e-commerce sphere. Big Data is a valuable instrument which solves multiple problems of the industry and brings various advantages. But are there any drawbacks? What is the role of Big Data in e-commerce? And who is the best Big Data analytics vendor? Let's find out!
Use of Big Data in e-commerce to solve common problems
Over the last 4 years, revenue from the goods sold via the Internet has doubled. Compare, there were more than 300 million active users on Amazon in 2015. And 183 million people visited Amazon in September 2017 only! 87 million people visited Wal-Mart and 86 million people visited eBay during the same period in 2017. In the third quarter of 2017 PayPal, one of the most trusted online payment gateways, calculated 200 million registered active users in total worldwide.
All these users create tons of information. More users - more data. And here you need to make a choice, either you ignore it and use a blind trial-and-error method or, you use all the information to advance your business approach. It's up to you. But if you choose the second option you have a chance to solve a range of problems connected with the e-Commerce sphere. Here are the advantages of Big Data in e-commerce sphere:
- Trend prediction
Special forecasting systems based on Big Data algorithms pull data from all known social media and browsers and defines the biggest trends and hypes. This is how to turn Big Data in to e-commerce. It is always easy to foresee the tendencies and preferences of the society. The other option is to track ad data. While monitoring marketing companies and departments you can get the information about the trends which are only forming. As well as that, the Big Data e-commerce system processes requests in browsers analysing whether they are positive or negative concerning each particular product. All these insights are needed to build better business strategy.
- Price formation
As a businessman you know that the retail margin forms your revenue, still, if you make it too high, people will approach your competitors. That is why the issue of price formation is so crucial. E-commerce Big Data tools collect and compare prices of one product all over the Internet. The platforms pull such data as prices of your competitors, cost of a product, its popularity, unit sales data and many others. It also follows the demand for a product and can suggest you an optimal price in a real-time mode.
- Demand forecast
Have you ever calculated what is the average time a product is kept in a warehouse before it is bought? Have you ever calculated how much you pay for this time? Storage expenses can kill your business. Such events like holidays, football matches and festivals can bring you lots of money. And e-commerce application on Big Data takes all these factors into account to provide you with the freshest information about the demand forecast. Thus, you'll be able to get the products and their precise number to sell in a particular period of time.
- Personalized approach
To understand how Big Data enables personalization in e-commerce, we need to learn how browsers work. Modern browsers 'memorize' all your requests and preferences, store this information and offer you the goods you may need. You should do the same! Your online shop can track the preferences of visitors and fill a store with relevant products. In such a way, you increase revenue and a customer buys more because he or she sees more goods which they can potentially buy (based on the history of reviews). If you add a feature of personalized suggestions, your customers would appreciate it very much (and reward you with more purchases).
- Service Improvement
There so many rivalries on the market that you need to be the fastest, the most pleasing and polite. Otherwise, you lose a client. Did you know that almost 90% of customers deny dealing with a company after they faced poor services? A half of all customers leave a transaction if their requests aren't processed quickly enough. Companies use Big Data in e-commerce to collect the information about customers from their social pages and browser history. By doing this, you can offer absolutely new, personalized, improved services to your clients.
- Sales increase
Business has to grow. You need to increase sales all the time. Big Data can help you here too. For instance, Big Data can solve the issue of shopping cart abandonment. It was estimated that almost 70% of all shopping carts are abandoned before a purchase. It happens due to multiple reasons and Big data analytics should reveal them.
Continue of this article role of Big Data in e-commerce.