How Big Data is Reshaping the Ecommerce Industry?

If there’s one thing that is growing at an unprecedented rate globally, it is data. Like every other industry, eCommerce is rapidly expanding. This is on account of changing behaviors of the customers. Similarly, the data that runs the industry is growing with it.
Have you ever logged into your social media profile and found sponsored posts or ads on your feed?
The interesting fact is that these products are the same that you must have Googled for at some point in time.
These kinds of experiences might seem magical and make you believe in random Internet conspiracy theories. However, they are nothing but a result of big data.
Modern businesses are leveraging techniques to use the increasing amounts of data. A majority of these businesses agree on big data as it is the ultimate key to the powerful and growing future of the eCommerce world.
But, big data is not limited to familiar shopping ads popping on your screen now and then. Instead, there are many more sources from where businesses derive data and put it to various uses.
In simpler terms, big data can be the key to understanding customer’s preferences. The question is, what should you do to leverage it? Read on to find out more.

What is Big Data?

To get you started, big data simply refers to large amounts of data. This might include structured or unstructured data. But, the underlying quality of big data is that it is exponentially growing.
Even though big data laid its foundations in early 2000, businesses have recently interpreted big data. Thanks to the advances in data science methods.
Big data cannot be harnessed using traditional methods. The credit goes to its huge size and complexity. For sellers, big data can refer to three major areas- social, transactional, and machine. Like the name, social data refers to insights from social media platforms.
For example, the engagement metrics like the number of views, comments, likes, etc., fall into this category.

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Similarly, big transaction data refers to the data generated due to customer transactions on online shops. These can be used to predict the behavior of the customer. Ultimately, it can help in improving the buying experience.
The last area where big data finds its way into eCommerce is machine data. It includes the data that pours in from sensors and any physical equipment.
For example, wearable devices such as smartwatches and bands generate many data by tracking the customer’s vitals. You can leverage it for a variety of personalized recommendations. In other words, types of big data can impact the eCommerce industry in different ways.

How is Big Data Changing the Ecommerce Industry?

Awareness of big data continues to spread across businesses in the eCommerce domain. While digitization is one factor, reduced technological costs are also responsible for this cause. In many ways, all of this has been contributing to the change in the eCommerce industry.

1. Better Strategic Decisions

Big data is changing the landscape of eCommerce. It is paving the way for better decision-making. When businesses have data pouring in from all sources, they leverage analytical methods. This helps unravel deeper insights that were previously not available to decision-makers.

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For example, the buyer’s pain points, needs, expectations, behavior patterns, etc., are now in the light of the eCommerce business.
With all these insights, sellers know about the customer better than ever before. They understand the needs and changing demands change during seasons. This is helping them make better decisions regarding their business.
Earlier business decisions were based on experience and intuition. However, today they have become more data-driven. As a result, the eCommerce experience has become a lot better for the customers. They are finding it more convenient to shop than ever. But, also, they are more content than ever with the experience.
Statistics suggest that big data in the eCommerce industry is expected to grow at a CAGR of 13.2 percent. The projection for the years 2019-2028 sheds light on how everyday eCommerce sellers leverage it. Thanks to its benefits to the eCommerce sector.

2. Improved Control of Operational Processes

54 percent of the online sellers believe that using big data has improved their operational processes’ efficiency. On the one hand, they are in better control of their operations. On the other, they are also enjoying a smoother and efficient business.
A majority of businesses face challenges in conducting business operations. As a result, their customer experience is hampered. With the introduction of big data in eCommerce, this scenario is changing. Now sellers can improve their operational efficiency by analyzing customer’s behaviors. This way, they can stay a step ahead.
In other words, by analyzing the shopping data of buyers, you can understand their behaviors. This can help in implementing predictive analytics at various levels.
For example, you can figure out the average checkout wait time, most likely products purchased in a season, among others.
Eventually, the insights help businesses stay prepared for orders. When sellers know what they are up against in the market, they can control their operations in advance. Be it storing inventory before the demands increase or preparing for logistics during a sale season, big data help say a step ahead.

3. Superior Understanding of Customers

One of the biggest ways big data has changed the eCommerce industry is helping sellers understand their customers better.
There was a time when people could not imagine eCommerce replacing the retail experience. And that is because retail had the kind of personalized experience that couldn’t be found anywhere. But, today, we know how the tables are turning. The age of brick and mortar stores has passed.
Today customers love shopping online. This process has accelerated after the advent of the pandemic.
One of the biggest reasons behind this is the intervention of big data into eCommerce. With big data in the picture, sellers are painting the personas of their customers. This is helping them understand better than ever.
One key area where big data is helping understand customers better is sentiment analysis. It is the process by which sellers monitor the sentiments of their customers’ emotions from different platforms. It can be on social media or any other customer touchpoint that buyers choose to interact with.
This way, businesses can classify customer behavior into neutral, negative, or positive. Once these are understood, business strategies for improvement are built.

4. Cost Reductions

Cost reduction is yet another way big data is changing the eCommerce landscape. Ever wonder why more and more sellers are heading towards eCommerce than retail?
That’s because eCommerce is one of the most profitable areas. The best part is that sellers don’t even have to invest a lot of money to establish an online business.
A lot of it has been possible due to the application of big data in eCommerce. With big data in the picture, eCommerce sellers are leveraging automation. Today many tools help sellers manage their business more effectively.
All of this would have taken several resources and investment in them a few years ago. Sellers would have to hire an entire team to manage their inventory and keep an eye on their stock. But, with modern tools, you can do everything from a single place. Alternatively, this can be through a single point of contact.
Cost reduction is allowing new sellers to enter the market. It is giving them opportunities to turn their ideas into a reality without the bottleneck of investment. This is not just limited to local markets but cross border trade as well.
With big data by their side, sellers can dream of entering new territories across the globe.

5. Greater Sales

The market giant Amazon today makes sales that surpass those of a majority of retail stores. And not just a big business, but even the small and medium ones are earning well in eCommerce. Wondering why? Customers are purchasing more than ever.
Owing to the more than satisfactory experience and attractive prices, eCommerce sales are rising. Big data has the biggest part to play in this. It is with great analytical power over data that sellers understand customers better. Therefore, they are modeling their business to cater to these needs better.
In another interesting way, big data helps sellers identify sale opportunities. By analyzing the customer’s behaviors, sellers are understanding market demands. Ultimately, they are learning to place the products in a way that will lure customers into buying them.
Furthermore, remarketing campaigns are also boosting sales. Remember how we talked about searching our favorite products and then finding their ads on almost every platform?
Big data is helping sellers increase sales. It is by selectively advertising them on platforms where their customers are most active.

6. Opportunity for Small Sellers

Big data is opening the gateway of eCommerce to small entrepreneurs. These are the people who have ideas but not a heavy investment.
There was a time when sellers needed to invest a huge sum of money in setting up an online business. Because this would include full-fledged teams, who could study the market, collect data, analyze them and execute.
As a result of this, not everyone could dream of owning an eCommerce store.
But now, big data is bringing a big transformation to eCommerce. More and more small sellers are creating their eCommerce stores and daring to dream big. They can compete with big enterprises by leveraging big data.

How Can You Use Big Data to Improve Your Ecommerce Business?

Every business can make the most of the market using big data. They can expand their customer base, enhance their sales and do more than ever. But, for this to happen, as a seller, you need to start using big data. Here’s how-

1. Competitive Pricing

The way you price your products can impact your business in many ways. Pricing is, in fact, one of the most important factors that customers consider before purchasing your products. If it’s competitive, they might make a purchase.
If you’re familiar with eCommerce, you’d know that today every customer’s journey begins from Google - especially through ecommerce SEO. Search engines are the best way to search for products.
All one has to do is type the keywords of what they are looking for. The point is that when customers look for products on search engines, several links pop up. And when they’re looking to purchase, they’d take a look at all visible prices.
Therefore, if your competitors have a better price than you, chances are your potential buyers will buy from them.
In other words, you will lose sales. But, if you use big data to the rescue, you can keep a check on your competitor’s prices. You can unravel their pricing strategy. This will help you respond accordingly. So, when your customers find your products’ best prices, there is no way you are losing sales.

2. Predict Trends

Ever wonder why stores like Amazon have everything that customers wish for?
Be it a newly launched product or a classic one; they have it all. But the trick isn’t that you have all kinds of products in your store. Instead, you must have the ones that customers want.
The question is, how do you know which products your customers will want in the future?
The answer lies in big data.
With big data, eCommerce sellers can predict trends. In other words, you can know which products will be the bestselling in the time to come. But, make sure that you leverage this knowledge before your competitors do.
For the longest periods, sellers have used guesswork to figure out the next big products. It is imperative to understand that catering to the customers’ demands is not a one-time thing. Neither does it end in the present state of affairs.
If you want yourself sustained in the long run, you need to stay a step ahead of your customers. Use big data to prepare your business for upcoming trends and technologies.
You can compile your previous years’ social and transactional data. You can use this to anticipate purchase patterns on products.

3. Effective Management of Inventory

To advance your business, you have to manage your inventory effectively. Most sellers think that inventory management means keeping your products in good condition. However, that is only one part of the process. Effective inventory management includes tracking your products from end to end.
This means that as sellers, you must know which of your products are fast selling, depleting, out of stock, and more. Additionally, you must also be able to track products that are returned the most.
Big data analytics can help you track demands and your inventory. It can throw light on all kinds of inventory you have at a point in time. But, even this is not enough.
If you want to be there for the customers before your competitors are, you need to stay a step ahead. Big data can help you forecast your inventory. This way you can determine the right kind of products you might need in the coming future.
In other words, it saves your money from being wasted on products that no longer sell. Make sure you sign up for big data for your business the moment you start it. Otherwise, you’ll lose more than a few opportunities.

4. Customer Service

Customer service is the reason many eCommerce businesses fail. Sellers are too busy selling their products that they forget it all comes down to customer service.
Your buyers expect you to provide customer service like Amazon. This means you have to be there for them 24 * 7 and adopt a customer-first approach.
You might be doing everything well for your business. But, if you’re not working on your customer service, your buyers will leave you straight.
However, this doesn’t have to be the case with big data in the picture. When you’re using big data for customer service, you offer exceptional satisfaction to your customers.
In other words, big data allows you to discover better service strategies for your business. More precisely, you can provide the service that your customers are expecting from your business.
Statistics suggest that acquiring new customers takes up to 10 times more than selling to an existing customer. Additionally, your loyal customers shop as much as 67 percent more than your new customers.
When you collect customer data over time and use it to derive insights, you connect with your customers better than ever before.

5. Personalized Experience

Personalization is the king of commerce. Imagine walking into a retail store to purchase a television. You’d expect a service representative to walk up to you and ask about your needs.
Based upon your answers, they will provide you with a solution that fits their needs. In the end, you find what you came for and feel satisfied with your purchase.
This is an example of a personalized experience. Remember that physical contact is not possible in an eCommerce scenario. But, there are other ways to personalize the shopping experience. And big data is one of the biggest enablers.
You can use big data to personalize your customer’s shopping journey. It isn’t something that you can leave for a later duration of time. In other words, personalization is the need of the hour.
Customer data such as buying preferences, browsing patterns, etc., can help you understand their pain points. This way, you can understand how to target your customers. If your customers are looking for discounts, offer them coupons, vouchers, and other forms of opportunities.

6. Secure Online Payments

The foundation of every online business lies in the safe and secure experience of its users. If you fail to deliver this, you are left with sour reviews. Your customers walk away from your business, and you earn a bad reputation in the market. Big data can be the key to walking away from all these issues.
In other words, big data analytics can guarantee a safe and secure payment experience. You have to analyze large banks of data to detect any fraudulent payments.
For example, PayPal is a wallet payment service that leverages data analytics. The company turns big data into a detection mechanism for any payment frauds and outlier transactions. This way, they are keeping their user transactions safe.
Alternatively, you can also use big data to determine the most used payment methods by the customers.
You can later use this as a narrative in your ecommerce search marketing strategy. When customers find payment methods they are looking for, they will convert.

7. Targeted Marketing

One of the key areas where you can leverage big data is marketing. Most marketing campaigns fail because they don’t connect with customers on an emotional level. If you’re talking to your customers like you’re speaking to the masses, don’t expect them to convert.

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Most customers delete emails from brands even without opening them. Remember that your customers are sophisticated. And so, it should be your marketing narrative.
In simpler terms, make your customers feel valued. Use big data to reach out to them on a personal level. For example, you can send them emails that target their precise pain point and why your product fits into it.
Big data can help you find out which of your customers are interested in a particular kind of product. This way, you just sell them what they truly want.


Big data has already created a profound impact on the eCommerce sector. In the times to come, it will continue to add value to sellers and businesses. While this provided opportunity to small sellers, it also gives a competitive advantage to anyone who leverages it.
Using big data, sellers can stay prepared for any market influxes and changing trends. But, despite a plethora of benefits, only a handful of businesses are currently using big data to their advantage.
While it might be due to infrastructural constraints, several sellers have no clue where to get started.
Cloud-based solutions are one area to get started with big data. But, the first step towards change begins with coming out of the comfort zones. And then, finally, relying on the concrete facts that shape big decisions- data.
Get in touch with our big data experts to boost your ecommerce sales using big data.

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