What Impact Big Data Analytics Can Have on E-Commerce Industry?

In the current digital revolution, the world is increasingly producing a massive amount of data, with 44 zettabytes expecting to have this year. The number is likely to reach 175 zettabytes by 2025, according to IDC. However, maintaining and processing this large volume of data requires more computing power with analytical capabilities. Big data and analytics technology can play a significant role in this scenario as it has the potential to analyze large and varied data sets.

Driven by specific analytics systems and software, along with vast computing capacity, big data analytics offers a broad range of business benefits. By embracing this tech, companies can get new revenue opportunities, deliver better customer service, drive more effective marketing, and gain enhanced operational efficiency and competitive edge.

As big data analytics provides huge capabilities, businesses across industries are significantly turning to it, enabling more efficient and effective predictive models. One such industry is e-commerce where customers are king and a major driver of a business success.

What Does Big Data Analytics Mean for E-Commerce?

Big data analytics empowers business leaders to derive values from the information they typically gather to make optimal business decisions. The technology helps e-commerce companies to understand their customers. It allows them to envisage market trends to boost revenue. Consider a report from Smart Data Collective, the e-commerce market is expected to worth US$4.5 trillion by 2021.

Retail businesses are significantly investing in big data technology as sales of big data-enabled products and services predicted to be worth US$48.6 billion in 2019, at a compound annual growth of 23.1 percent through the same year.

Big data analytics tools are able to track the buying journey of customers. The tools can capture the interactions a user previously had with a brand, such as products viewed, clicks, past purchases, among others. The data collected from their purchasing journey allows businesses to get the shoppers’ information and comprehend them profoundly what they like and dislike, which products they prefer most or looked around recently, what time the demand for certain products rises, and more.

Harnessing big data analytics can also deliver personalized offerings and experiences. As customer expectations increase with time, they also expect more from brands while searching for things they need. According to reports, most shoppers consider that they are more willing to buy more things when online stores personalize the shopping experience. Furthermore, once a business gets the shoppers’ info, they are more able to create personalized experiences that cater to their needs.

Many e-commerce companies use personalized experience strategies such as sending customized emails to users to let them know about special discounts and offers; displaying targeted ads to various segments of people; implementing up-selling and cross-selling strategies to individuals; and much more. E-commerce giant Amazon is a great example of embracing big data analytics and cross-selling strategy to generate high revenue.

In e-commerce space, pricing is another vital factor for driving purchase decisions. Earlier, companies used to follow conventional pricing models but now the day has gone and requires strategic approaches to retain customers. Thus, by making use of big data analytics tools, retailers can look at the greater picture and monitor the pricing of their adversaries in real-time. This requires a large data set with all the prices of competitors, which needs to be up to date from time to time as the market price is always varying.

So, the use of big data and analytic technology has the ability to increase customer engagement as well as customer retention rate within the e-commerce industry. The technology also helps predict future trends in order to plan effective marketing campaigns. Certainly, the analysis of big shopping data will be helpful for retailers to make a healthy relationship with their customers and will enhance the service for them.