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Ways Amazon Uses Big Data To Stalk You & Bring More Effective User Experience!13 min read

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Many shoppers may find it odd when a shop knows a lot about them purely through the products they buy. Amazon.com, Inc. (AMZN) is a pioneer in gathering, saving, sorting and reviewing your and every other customer’s personal information as a means of determining how consumers are spending their money. The company is using predictive analytics for targeted marketing to boost customer satisfaction and build loyalty to the company. While big data has also helped Amazon to evolve into a giant among online retail stores, what the company knows about you might feel like stalking. Below we are going to discuss how Amazon uses Big data and predictive analysis to improve user experience. 

1. Personalized recommendation system

Amazon is a leader in the use of an integrated, collaborative filtering engine (CFE). This analyzes which goods you have recently bought, which are in your online shopping cart or on your wish list, which things you have checked and valued and which items you are most searching for. Such knowledge is used to suggest additional products bought by other consumers as they order those same things.

For example, anytime you attach a Movie to your online shopping cart, it’s also advised that you buy similar movies bought by other consumers. Amazon uses the power of recommendation to allow customers to order on-the-spot as a way to further fulfill your shopping experience and spend more money

2. Recommendation for kindle highlighting

Following the acquisition of Goodreads in 2013, Amazon has integrated the social networking service of around 25 million users into some Kindle functions. Kindle users can, therefore, highlight terms and comments, and exchange them with others as a way to discuss the text. Amazon checks the terms displayed in your Kindle frequently to decide what you’re interested in learning. The organization may then give you more suggestions on the e-book.

3. Ordering on single click | Amazon Uses Big Data 

Because big data shows you shop elsewhere, Amazon created One-Click ordering unless your products are delivered quickly. One-Click is a patented feature that is enabled automatically when you place your first order and enter a shipping address and method of payment. You have 30 minutes by selecting one-click shopping in which you can change your mind about the transaction. After that, the product will be paid automatically through your payment method and delivered to your address.

4. Anticipatory shipping model

Amazon’s proprietary anticipatory delivery model uses big data to predict the goods you’re likely to buy, when you can buy them, and where the items might be required. The goods are sent to a local distribution center or distributor so once you order them, they will be available for shipment. Amazon employs predictive analytics to boost retail sales and profit profits, thus rising delivery times and overall costs.

5. Optimization of supply chain

Since Amazon needs to easily deliver its purchases, the organization works with the suppliers and records their inventories. Amazon uses large data systems to pick the warehouse nearest to the retailer and/or to the shipping costs by 10 to 40%. In fact, graph theory helps to decide the best delivery schedule, path, and groupings of goods to further reduce shipping costs.

6. Optimization of price

Big data is also used to monitor the costs of Amazon to attract more customers and increase profits by an average of 25 percent per year. Prices are set according to the website operation, pricing of rivals, quality of merchandise, expectations of customers, the background of sales, anticipated profit margin and other considerations. When big data is modified and evaluated, the product prices typically change every 10 minutes. As a consequence, Amazon usually gives best-selling product prices and receives larger profits on less popular items. Of example, the cost of a novel on the New York Times Best Sellers list maybe 25% lower than the retail price, whereas a novel not included in the chart costs 10% more than the same book sold by a company

7. Amazon web services

Using Amazon Web Services (AWS), the cloud computing company launched by Amazon in 2006, organizations may build flexible big data systems and protect them without the use of equipment or infrastructure maintenance. Big data applications like data warehousing, clickstream analytics,  fraud detection, recommendation engines, Internet-of-Things (IoT) processing and event-driven ETL processing are usually via cloud computing. Companies can take advantage of Amazon Web Services by using them to evaluate profiles of consumers, spending habits and other relevant information to more efficiently cross-sell client goods in ways similar to Amazon. Some companies can also use Amazon to harass you, in other words.

big-data-mining-techniques

8. Safe with virtual cash | Amazon Uses Big Data 

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Amazon, one of the world’s most valuable firms, has mastered the art of e-commerce and by targeting you, they have achieved so. That’s Ok! The company gathers, stores, analyzes and manages data from you depending on the things you are shopping, what you are spending your money on and where you send your orders to. They then use this data to create a 360-degree view of you, and recommend products you may not even know you need.

We analyze in this webinar how Amazon uses big data to drive growth, increase sales, cut costs, and become a trillion-dollar company.

Amazon doesn’t just want robots to bring your products to your doorstep, it needs them to be able to deliver them wherever you’ve made the next footstep.

In a recently published patent application by the US Patent and Trademark Office, Amazon explains methods by which its drones can follow a consumer using their mobile to determine their current location, such as the house of a relative, and distribute the order accordingly.

If the thought of following your personal drone across town seems a little scary, it’s really much more sinister than this. The patent application further explains how Amazon’s drone fleet might interact with each other to provide on-going reports on weather and routes and, I suppose, hostile pigeon flocks in the field, who knows. In other terms, we’re not just thinking about stalking drones, we’re also talking about working together with teams of stalking drones to provide the most efficient stalking service possible.

All of this relies, of course, on an Amazon customer actually ordering this program. The patent application displays a sample order dialog which offers a choice of predetermined delivery locations or an alternative to “Take it to Me.” You can also set delivery time and the location. So if any of this makes you uncomfortable, just think about the fun with our future drone stalkers that we can all have.

I’m looking forward to the day when I can arrange delivery of energy drinks to a half-marathon start line. Just as the drone arrives with my refreshments, the starting gun will crack and my personal unmanned aerial butler will drive me down the course of the road, even waiting to drop off my drinks as soon as I’m ready for a pick-me-up.

Big Data is all about tomorrow and how best to manage it. See, companies don’t need more info. Most medium to large companies either has the data or easy ways to get it. The thing is most of them don’t know how to deal with it.

Here comes the boom: Nowadays, predictive analytics is* the thing*. Long gone are the days when it was enough merely to register, process data and act on the findings in the next fiscal year. Even now, data were captured, processed and reacted to by the fastest growing businesses in real time.

Predictive analysis: how does it work?

We’re all leaving trails behind. Our shopping habits, our marital status, our social groups, the shows that we watch and the gadgets that we buy–all these and much more are trails and they are somewhere in some database. 

Using this info, or whatever is accessible at any given time, predictive analytics software will evaluate our future actions by means of two forms of programmed responses (it’s a bit more complicated than that, but you’ll get the picture):

Rules-based personalization

“If this is more than that.” Basic Customization. Ex.: Consumers click on an ad, go to our website and we can decide whether they are from New York. First, let’s introduce them to our New York shops. We press on our list of items, choose the high-priced products. Boom!-Bang! We now learn that they have a moderate to high income. This form of sensitive personalization really does not allow the use of any kind of predictive analysis. It reacts merely to actions. It is not trying to predict them. This is a job for…

Predictive analysis

This is easily something that we humans can do. Machines, and not that much. Let’s presume our sports shop has a salesperson with a respectable Intelligence who is at least a little interested in checking out the products for the consumers. He notes that in the last hour consumer X has pulled on at least a dozen sports shoes. He’s talking to the client and telling him, “Yeah, may I attract you in this brand new snowmobile? It’s 10% off. Yeah, wait for that to be funny. Just what old-fashioned ads would do. In fact, he would ask the customer if he could help him find some shoes which fit and look good. That’s essentially what Predictive Personalization is all about: a real-time review of the results.

Why do companies stalk their customers?

You wonder why Facebook is so easy to stalk? Since citizens want to get to know other people and their preferences. The Millennials, the digital natives, Generation Y–they are the young people of today and they are raised and live online. We give their data, exchange concerns, make their images available. No more call to the public. Everybody expects to be treated like an individual.

Organizations that don’t “stalk” their clients will be left behind: personal is eBay, personal is Twitter, personal is Google. Most of the top online retailers are small and allow the shopping experience exclusive to consumers.

Offline, how? Yes, we couldn’t have had any kind of predictive analytics or offline personalization 5 years ago but that’s changed by the iPhone. Now smartphones fill the gap between the online and offline behaviors recorded in the records. Organizations are now measuring consumer behavior through smartphone usage and using predictive analytics to address the needs of consumers and want… well. Person.

Amazon, one of the world’s most valuable firms, has mastered the art of e-commerce and by targeting you, they have achieved so. That’s Ok! The company gathers, stores, analyses and manages data from you depending on the things you are shopping, what you are spending your money on and where you send your orders to. We then use this data to create a 360-degree image of you, and offer things you may not even realize you need. Imarticus Education provides Industry-endorsed accredited training in Investment Banking, Financial Services,  Business Analysis, IT, Business Analytics & Wealth Management.

How Amazon uses big data?

Amazon also succeeded since embracing the concept of “everything under one roof.” Faced with such a large array of options, though, consumers can often feel overwhelmed. We then are data-rich, with lots of choices but insight-poor, with little knowledge of what the right buying choice would be for them.

To counter this, Amazon uses Big Data obtained from users to develop and fine-tune the recommendation engine as they search. The more information Amazon has of you, the more it can foresee what you want to purchase. However, once the store understands what you might want, it can streamline the process of persuading you to purchase it–by offering different products.

Amazon’s selection technology is based on social screening, which ensures you determine what you think you want by building an image of who you are and then showing you products purchased by people with similar profiles.

Amazon collects data on each of its customers while they are using the platform. The company also monitors what you’re looking at, your shipping address (Amazon can take a surprisingly good guess at your income level based on where you’re living), and whether you’re leaving reviews/feedback.

A mountain of data is used as an individual client to create a “360-degree image” of you. Amazon can then find other people that fall in the same particular market category (for example, working males between 18 and 45, live in a rented house with an income of more than $30,000 who love foreign movies) and make recommendations dependent on what those other customers want.

Technical details of How Amazon Uses Big Data

Amazon captures user data as they visit the web, for example, the time spent reading each article and after this Amazon uses big data. The company often utilizes external databases for collecting demographic information, such as census data.

The core business of Amazon is handled in its central data warehouse, which is composed of Hewlett-Packard servers running Oracle on Linux.

Customers can be confused by too many options and too little input which puts them off making purchasing decisions. Recommendation algorithms reduce the job of anticipating what a customer wants, analyzing them and looking at what people buy that fall into common niches. In this way, developing a 360-degree view of your customers as individuals is the foundation of a marketing and customer service driven by big data.

The growing ability to collect and store data has provided companies greater capacity for retrospective and real-time research. We can now track trends and draw conclusions regarding flaws so that we don’t walk on the same rake. Or we can define the most effective solutions and replicate what we have accomplished.

In the long term, predictive analytics are always more efficient than historical or real-time analytics, just as avoidance is more successful than urgent medical care. Retrospective analytics is, in fact, an autopsy— an investigation of a mistake that cannot be reversed. Real-time analytics is an ambulance that responds here and now.

Amazon takes advantage of digital ads…

Offer consumers products and services based on their past habits. These reviews account for close to 30 percent of Amazon’s revenue, according to some estimates. Additionally, Amazon has plans to develop a platform that, relying on predictions, would distribute merchandise to locations where orders were anticipated even before such orders were put on the web, reducing the time for consumers to deliver goods.

According to Deloitte’s CMO Survey: Spring 2019 survey, the proportion of business decisions made on marketing analytics reached a peak in early 2019 (considering data from the past six years). According to a Markets and Markets report, the demand for predictive analytics will expand from $4 billion to over $12 billion by 2022 An increase in marketing analytics in general — and in predictive analytics in particular — encourages companies to build easy-to-use tools and services that make predictive analytics more available to businesses.

Own an eCommerce Business? Contact us to find out how you can use Big Data Analysis to Improve User Experience.


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