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Lazada adopts big data to improve customer experience

Adrian M. Reodique | March 18, 2016
Big data helps Lazada understand the buying decisions of their customers.

Big data technology and services market is expected to grow at a compound annual growth rate (CAGR) of 23.1 percent over 2014 to 2019, with an annual spending of US$48.6 billion in 2019, according to research firm IDC.

In line with this prediction, businesses are increasingly investing in big data to improve business operations as well as boost the customer experience.

For Singapore-based e-commerce company, Lazada, its big data journey is just starting. "We only started our big data journey about a year ago - so compared to similar e-commerce companies in the Asia Pacific region and the US, we are still pretty new at this," said Martell Hardenberg, CEO and co-founder of Lazada Singapore, in an email interview.

Aside from attracting shoppers, Hardenberg said they leveraged big data technology to incentivise its consumers to repurchase with them. "The data that we collect allows us to better understand the shoppers' profiles and general habits. From here, we are able to streamline how shoppers find products through targeted marketing and offers, better product recommendations, and more relevant and interesting products and product mix on display; which results in a better user experience," he said.

Lazada's big data journey

According to Hardenberg, e-commerce is like a "dating service"; but instead of matching one person to another, it matches people with the products they are looking for.

He added that the big data team of Lazada is responsible for handling data science, data engineering, as well as search and data tools. Despite being a neophyte in this tool, Hardenberg said that they have been able to discover a wealth of insights about their customers through big data.

Big data technology allows Lazada to monitor the amount of data arriving in their system especially during their Birthday Sale and Online Revolution event. "We typically see five to 10 times increase in data coming through our servers as compared to an average day. During this period, we experience new sign-ups and existing shoppers who are pre-planning ahead of the sale. These information will help us to refine the [online shopping] experience," explained Hardenberg.

In addition, this new tool helps the company to understand more about the buying decisions of their customers. "For example, the average time from when a user first views a laptop until they buy is 15 days. Once we know such information, we can start figuring out how to help them make the best buying decision," he added.

When embarking on a big data journey, one of the challenges that most companies often face is talent crunch. But for Lazada, this does not impose a huge problem to them.

"Singapore has a great university system and corresponding STEM (Science, Technology, Engineering and Mathematics) programmes, which produces a pool of highly-qualified STEM graduates. There is also a lot more talent if you look across the whole region.  While I don't think that the supply has sufficiently kept up with the demand, many data scientists are really attracted to the complex challenges that e-commerce provides," said Hardenberg.


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