Thriving in today’s business world relies on knowing how to use data to your advantage — but what does that mean, and is it feasible?

We’re here to explore all the ins and outs of using “Big Data” in eCommerce to answer those questions and more.

Whether you’re a seasoned eCommerce pro or the founder of a new startup, we’ve got tips and information for everyone. Read on to learn what Big Data is, why you need it, and how to use it to your advantage.


What Is Big Data?

This is a case where the label is very accurate to the subject: Big Data is a vast set, or multiple sets, of information.

What sets Big Data apart from other large data sets is that it’s often complex and/or complicated, in addition to simply being on a much bigger scale. A few details about your customers don’t count as Big Data, but complete and detailed individual customer profiles would.

Big Data usually requires specific software and programs. That’s because legacy solutions aren’t built to handle the complexity or volume of information that comes with it — and that’s a large volume.

Volume of data from 2010 to 2020

Source: Statista


Why Do You Need Big Data in eCommerce?

Online retailers need to know how to make customers happy and how to beat the competition and thrive in a highly competitive environment. That’s about as easy as it sounds, which is to say, it’s very tough.

Big Data can help.

Here are some main ways eCommerce businesses can use Big Data to their advantage and why this resource is indispensable for virtual companies.


Personalizing the customer experience

Analytics tools help you gather plenty of information on your customers, which is crucial when providing each one with a personalized experience.

Big Data lets you gather details like customers’ previous purchases, individual peak shopping times, and much more. This enables you to build customer profiles and buyer personas full of valuable information. You can use these to create a personalized shopping experience beyond simply addressing customers by name.

The result is more loyal customers, thanks to Big Data.


Forecasting accurate predictions

Another of Big Data’s major powers lies in predictive analytics, used for accurate demand forecasting. Tons of recent data are used to create models of future demand that businesses can utilize to make informed decisions regarding their stock and planning.

Having Big Data on your side in this way lets you take a new approach to how eCommerce works for your business. That’s because you’ll never have to think about over- or under-stocking items again since your predictive models can help you make data-informed decisions.

Predictive analytics also help you prepare for unexpected events and holiday periods, making them a cornerstone of effective online business management.


Optimizing business decisions

Similarly, Big Data can help you accurately target your campaigns to the right audiences. This lets online retailers work out an optimal marketing strategy whenever they sit down to draw a new one up.

Big Data accomplishes this by gathering information on your existing and past marketing strategies. This can show you what was effective, what needed work, and who was drawn in by each campaign.


Responding to market trends

If one-half of running a successful eCommerce business relies on predicting future demand, the other half hinges on understanding and responding to current trends.

Real-time analytics empower you to do this.

Big Data lets you generate insights into ongoing trends by analyzing real-time developments and information. This involves collecting data on customer purchase history, social media conversations, and much more to draw up accurate charts detailing what’s popular.


Understanding the data

Last but certainly not least, Big Data is extremely useful for helping you make sense of all the information available to you.

Whether you want to know why your customers return purchases, which of your advertising campaigns have been effective and why, or what types of people tend to engage with your content the most, Big Data can help you. It’s your gateway to helpful insights of all kinds.

The best part is that Big Data can help you gather more data to then make sense of as well. This means you can use it to develop a comprehensive understanding of both your business and its customers.


Steps To Harness Big Data in Your Online Business

Next, we’ll walk you through the basic steps to start using Big Data within your eCommerce company. If you want to start harnessing its incredible power, follow along to transform your business strategies from within.


1. Decide how you’d like to use it.

As we’ve discussed, Big Data can help you with a lot of things, but not all of them are equally relevant to every business all the time.

For example, is your primary goal to maximize your online sales or to generate as many leads as possible? Are you looking to introduce loyalty programs, or do you want to focus on understanding customer behavior patterns first? Are you more concerned with real-time data or future predictions?

These are the sorts of questions you’ll have to answer first when you want to start using Big Data. A clear sense of direction will be instrumental in making the next step a success.


2. Choose the right tools.

You know precisely what you want to do with your data — now what?

It’s time to start setting up your tech stack to reflect your goals perfectly.

For example, you might need a highly modern data warehouse to store large quantities of data. An analytics tool is also an absolute must because Big Data is just raw information if you don’t synthesize it. Depending on your specific goals, you may also need other tools.

Above all, it’s crucial to make sure that your tools are talking to each other unless you want to risk complicated workflows and data silos.


3. Test, test, test.

They say that no plan survives first contact with the enemy. That’s not necessarily the case here, but it doesn’t mean that your tools will immediately become second nature to you.

To avoid complications later down the line, you need to test your tools and plans many times. Be as extensive as possible in your testing, too — it’s better to know that your solutions can withstand a challenge they’ll never face than to find out months later that you’re unprepared for a problem you’ve already run into.


4. Schedule regular reviews.

Getting anything right the first time is hard, and Big Data is no exception. That’s why we strongly recommend approaching your journey to harnessing Big Data as an ongoing process that calls for regular checks and reviews.

These reviews should involve figuring out what’s working well and what isn’t. They should also include space for asking the employees who work with the data daily what their thoughts are, as these are the people who can give the most insight into how you can improve.

Above all, be sure you’re ready to make changes and improvements. That way, your approach to data won’t stagnate and will always be able to grow.


Best Practices for Using Big Data in eCommerce

Lastly, we’ll discuss some of the top tips you should rely on if you’re going to be using Big Data in eCommerce. These will guide you and help you get things right more easily.


Focus on keeping data fresh.

Having tons of data is terrific, but only for as long as that data is fresh and usable. Once it becomes outdated, it’s just going to take up space that could go to valuable information instead, or worse, it could negatively affect other data sets.

That’s why keeping your data fresh is vital in data lake best practices, as these repositories are specifically designed for storing large quantities of data. They also help you avoid data silos, which come about when data is left to grow outdated and irrelevant in an isolated space.

Data silos infographic

Source: Forrestbusiness


Stay on top of news and developments.

Remember that Big Data is a relatively new concept. This means that new tools and solutions for working with it are constantly cropping up — so keep a close eye on the market. 

You never know when someone will discover a new and brilliant way to use Big Data in eCommerce for your benefit.

Additionally, working with Big Data gets easier when you know how everyone else is doing it. That’s why it’s a great idea to pick up fresh tips and tricks whenever possible and get involved in communities discussing them.


Make sure your tech stack is updated.

We’ve discussed the importance of tech already, but it bears highlighting that the shape of tech will directly influence the future of eCommerce.

When new tools are developed that help you do more in less time or with fewer resources, you’ll only be hurting your business by not trying them out. Once the new standard is set higher, more tools will be created that further raise this standard.

This is all possible because of how relatively young eCommerce is. Tech developers are still working out just how far they can push the limits of eCommerce, and once they do, you’ll want to be at the forefront of that positive revolution.

That’s why it’s crucial to keep updating your tech stack on a regular basis.


Final Thoughts

Big Data is full of potential.

This is because it’s essentially the means by which you can tap into a nearly bottomless well of knowledge, all of which can help you run your business more optimally. That’s why Big Data is so important to the world of eCommerce and why you should start using it for your business.

Running an online business as a source of income similarly has much potential, but it’s a highly competitive space to operate within. Thanks to Big Data, you can mitigate the risks and help your business thrive, all while securing as many happy customers as possible.


FAQs About Big Data in eCommerce

Lastly, we’ll cover some of the frequently asked questions people have about Big Data in eCommerce so you can find what you need at a glance.

How is Big Data used in eCommerce?

There are lots of different ways to use Big Data in eCommerce. The most straightforward answer is that any process or decision influenced by information can benefit from relying on Big Data. Some examples include customer experience personalization, data analytics, marketing strategy crafting, and much more.

Why are eCommerce startups interested in Big Data?

Startups are new to the game of online commerce, so they need all the tools they can get to help them get a leg up on the competition. Big Data is perfect for this because it helps startups understand their customer base and competitors alike while giving a boost to future-proofing.

Does Big Data influence the online shopping process?

In brief: yes, very much so. Big Data helps eCommerce shop owners tailor their customer experiences while also making it easier for them to target leads who might be interested in their products. On the customer’s end, Big Data helps connect you with new retailers and allows you to go from looking at a product to having it shipped to you seamlessly.

What are eCommerce analytics?

Put simply, eCommerce analytics is all about collecting plenty of data on your online store and then using that data to generate insights into your customers’ behavior and preferences. These insights can then be used to help you make fact-based decisions for the good of your business.

Is it easy to get started with Big Data?

Yes, it is! The term ‘Big Data’ might sound intimidating, but it’s really all about working with lots of information. All you need to get started with Big Data is the right tools and mindset — once you’ve got those, the rest is a simple matter of following instructions.