Hey guys, John from Segments here.
Welcome to the first episode of Ecom Data Cooler Talk, where we talk about important
topics in ecommerce and data, next to a watercooler. Ok, so the topic I want to share with you
today is a passion of mine and it’s also what I do and that is Data Science.
What is Data Science? To put it simply, data science is a practice
of utilizing information from different data elements to support business growth. Its main
purpose is to help businesses serve their customers better, by automating and optimizing
different operational areas in the business, as well as helping to provide better decision
support for its stakeholders. This is not something new entirely, it has existed in
the forms of financial analysts and business analysts for decades. What’s new about Data
Science, is that in the age of the internet and big data, with these technological advancements,
old ways of analyzing data is inefficient and obsolete. We have to come up with new
ways of collecting and summarizing data that are better suited for the task at hand. These new methods usually require specialized
training and experience, usually across multiple fields such as computer programming and statistics,
as well as other skills such as business acumen, and communication skills, which is why it’s
so hard to find someone who is good at all these areas, and even harder for institutions
to produce them. Why does Data Science matter?
Data is everywhere and it is increasing exponentially. If the internet is the great equalizer, then
data is the great differentiator. When you look at Amazon with books and Netflix with
DVDs, both started with relatively small niche with giant incumbents in the space. The way
they were able to displace their competitors and grow to be worth hundreds of billions
of dollars, in large part due to their deep understanding of their customers and their
data. They know what we like to watch, what we like to read, how often we do these things,
where we live, and what we spend. When you combine all this information together its
very powerful, and they were able to serve their customers better by providing better
value because of this. Ultimately the consumers made their choice and voted with their dollars. What does this matter to me? You’re probably
thinking John I don’t have time and money to deal with data. Well, that may be true
up until a few years ago, where mostly deep pocket corporations are racing to transform
their business in this digital age. However, with the emergence of cloud infrastructure,
open-source tools, and ecommerce platforms, the cost of data has dropped significantly.
Now the problem is most ecommerce stores owners are vastly under-utilizing their data, which
is a huge area for growth. Why can data science do for me?
In one sentence it’s to bring clarity to business metrics, surface insights on areas
to improve and help you understand your customers better. On top of this, build automations
and tools to help make life easier. For example, are you measuring your margins correctly?
If you are still using total revenue, which includes shipping and taxes, then you are
doing it wrong. Maybe you also want to know who your best customers are and how much they
will spend. In other words, you want customer lifetime value or CLV, which is an elusive
metric to most. Or maybe you want to analyze customer’s behavior and create different
segments to personalize your marketing efforts, which we all know is effective but sometimes
not simple to do. There are many other applications, but it
really comes down to these 3 things: extract insights from data, summarize them in an easy
to understand way, and infer future outcomes to make better decisions today. So just extract,
summarize, and infer. What other things you’re doing with your data today, or what other
things you wish you could be doing with your data today? Comment below and let me know
I’d love to hear from you. In this digital age, economies of scale have
created monopolies that corner the market on data, talent, and resources. By paying
pro-athlete level salaries, tech giants have largely made data science inaccessible to
most. That doesn’t have to be the way. Data is power, and we want to give ecommerce data
powers back to the people. Join us and start growing with your data today.