E-commerce grows rapidly. According to Statista, in 2023, overall sales in this sphere will reach $6,5 billion. However, with an increasing amount of customers grows the amount of stored data.
This information may be valuable for businesses because it can tell a lot about customers’ preferences, behavior patterns, and so on. In order to make use of this data, you have to analyze it. That’s why, in this article, we will talk about the role of Big Data in e-commerce, advantages, and pitfalls.
How to apply Big Data in E-commerce
Every user that visits any e-commerce platform leaves a concrete digital footprint. More users – more data they leave. And here’s the point where every entrepreneur faces a dilemma, either to ignore this data and follow a trial-and-error method or use every piece of information to develop your platform. If you choose the second option, you’ll get some advantages over those businesses that ignored Big Data. Let’s get through all benefits of this technology.
Custom forecasting systems based on Big Data algorithms gather information from all possible media sources, analyze it, and define future trends. It’s not a big deal to foresee the preferences of the society.
Another option is tracking the ad data. Marketing companies are going ahead of time, and while monitoring them, you can get the data about the trends that are only getting their shape. These insights will help you build a better business strategy.
Every retail entrepreneur understands that the margin forms his profit. However, if the margin is too high, customers will find more affordable alternatives. That’s why it’s crucial to find a balance between profit and a reasonable price for customers. Ecommerce CRM software equipped with Big Data algorithms gathers the price for a specific product all over the Internet. Then, algorithms compare the prices and output an optimal price for your customers.
Another adorable feature of big data is forecasting the demand. During the analysis, applications, equipped with big data algorithms, can take into account storage expenses, some specific events, storage time, etc. Thus, you’ll get advice on the number of goods to purchase. So, you’ll be sure that the specific amount of products will be sold on time.
Today, browsers keep all the requests and preferences, and based on this information, offer you the products you may be interested in. Big Data allows you to do the same with your e-commerce platform! Your online shop can track the habits and preferences of visitors and display relevant products on the web page. That’s how you can increase your revenue, brand loyalty, and increase user experience.
There’s an intense competition in the field of e-commerce. To stand out among your rivals, you have to deliver the best prices, the most polite and fastest service. More than half of clients leave the website if their transaction isn’t handled fast enough. With big data, you can collect user information from their social pages, and provide the most personalized service. On top of that, big data can be used to detect weak spots on your website, which may irritate customers.
The stable development of your business heavily relies on the sales scaling. Big data helps you to optimize this process by analyzing customers’ behavior. Have you ever heard that around 70% of shopping carts are abandoned right before the purchase? So, apart from displaying specific goods, big data can help you understand why customers are changing their minds in the last seconds.
Pitfalls of Big Data integration in E-commerce
Despite the optimistic spirit, big data isn’t a magic wand. Today, it has a range of pitfalls that has to be outlined. So, here’s the list of barriers you might face during the implementation of big data analytics in e-commerce.
The first and most common issue lies in the perception of entrepreneurs. Big data can’t solve every problem your platform has. If you have a poorly set up server, big data won’t fix it for you. It’s meant only to give you information. So, you should analyze and use it wisely.
Lack of Knowledge
Big Data is a serious tool, and it requires strong knowledge and a set of skills to operate it. First things first, you have to learn how to make proper queries. Besides, you also must know how to manage the database. The last point requires you to have an analytical mind. The reason is that machines don’t understand the meaning of variables, so they’re all the same for them. So, you have to figure out the dependencies by yourself. If you don’t have time for it, I’d recommend hiring a team of big data analysts.
Since Big Data algorithms collect and analyze tons of personal data, data leaks aren’t acceptable. Today, personal data is an object of desire for fraudsters and hackers all over the world. So, if you decide to adopt this strategy, make sure you have a flawless security system.
Some businesses can’t unleash the potential of big data because they stop halfway through. Instead of analyzing the data, entrepreneurs gather and store it. However, you can’t make use of information until you separate the significant one from the useless one. That’s why it’s important to invest in analysis tools more than in gathering ones.
The final point concerns hardware and software. Such a vast amount of information requires more computing power than an average office PC can provide. To get enough processing power, you can establish a server by yourself or engage Big Data as a Service (BDaaS). Modern BDaaS vendors offer a variety of services and reliable hardware.
As it comes clear, the big data system is complex and requires a strong technical background. If you don’t have time to manage everything by yourself, you have to hire a software development company that will do the job.
Best Big Data as a Service Solutions for E-commerce
When choosing a tool for big data, you have to make sure that you know how to work with it. There are several top tier solutions on the market. Let’s take a closer look at each of them.
Google Cloud Dataproc
Dataproc processes and analyses open-source data fast, easy, and secure. This platform, established by Google, runs Hadoop and Spark on Google’s Cloud Platform. Every data cluster is encrypted, so this BDaaS simplifies security concerns. It also delivers high performance by using GPUs for computations.
Amazon Web Services
AWS contains cloud-based business tools and services. Amazon’s Hadoop service is called Elastic MapReduce and uses Amazon S3 cloud storage. As Dataproc, it also pays a lot of attention to security. Amazon’s solution covers different data layers from a range of resources and outputs a visual representation.
Microsoft Azure HDInsight
Here’s another giant that runs Hadoop, Spark, and Kafka. With all the listed frameworks, it can quickly process big data clusters, scale them up or down. The sweet bonus is that you don’t have to pay for services that you don’t use. It also complies with all policies and standards. The cherry on the top is integration with other Azure services. Microsoft Azure HDInsight is a complex solution that can significantly improve your workflow.
Oracle Advanced Analytics
Oracle provides several systems and platforms for data analysis. The main platform includes Oracle R Enterprise and Oracle Data Mining, which in cooperation with Oracle Databases, become a perfect platform for real-time analytics. It has all the features needed for business, like market predictions, goods recommendation, and so on. Oracle even allows developers to build additional functionalities based on this BDaaS solution. However, you’ll probably need a development team to customize the system according to your demands.
Finally, you should understand that big data is no joke, and it may affect your business significantly. For now, you know how to implement big data, points where you have to be cautious, and the best big data services. The only thing you have to do is to hire a dedicated development team that will take care of the technical side of the question.
Guest Blog Author Bio: Vitaly Kuprenko is a technical writer at Cleveroad. It’s a web development company in Ukraine. He enjoys telling about tech innovations and digital ways to boost businesses.