Amazon Web Services’ mission is to provide tools and solutions for managing all the elements of an e-business. The way that Amazon uses big data is to make its online retail store as efficient and effective as possible. Amazon uses big data in everything from product suggestions to customer reviews to improve customer satisfaction and boost e-business revenues.
The latest development in Amazon’s web services strategy is what is called Amazon’s Artificial Intelligence initiative (IAI). This is the brainchild of Amazon’s Digital Marketing Lab, headed by Jeff Wilkins. Wilkins explained how Amazon uses big data for everything from recommending products to reducing customer traffic in the checkout lane. Amazon uses data analytics to suggest and test new products. They use it for fraud detection and even weather forecasts.
Amazon’s current success, according to Wilkins, is due in large part to the personalized recommendation system that they have in place at the main Amazon web site. When a customer uses a search query to find a product or service on the web site, the system will collect data sets from many different sources, including customer review sites and other websites. These data sets are then combined into a personalized recommendation system. This is how Amazon uses the collected data to suggest different products and services to customers who are searching for a particular product.
Amazon uses predictive analytics to help determine which specials to offer customers. It also uses this same predictive analytics to help determine the profitability of each of their business ventures. Predictive analytics helps the company determine which specials to offer customers and which ones to avoid. The research helps them fine tune their strategies and in turn, helps increase customer satisfaction. It helps the company sell more products at a faster pace.
Another area in which Amazon uses big data analytics is the use of customer behaviour. This area studies how people react to different promotional methods. This study can help market areas develop new promotional methods that are more effective. It also helps determine what methods work and what ones do not. It can help determine what types of promotional methods work best depending on the type of customer. For instance, it has found that coupons with discounts worked better than coupons with cash back, but when customers have used the coupons over a long period of time, the coupons were no longer effective.
A key strategy developed by Amazon using big data analytics is what is known as the Amazon LBP process. This is a long term investment concept that helps the ecommerce giant achieve its growth goals by investing in its future. Amazon has invested more than half of its worth into this idea so far, and it shows no signs of slowing down. The concept works by researching consumer behaviour across multiple industries and markets and applying this knowledge to creating a unique selling platform. This platform includes all of Amazon’s current promotions and offers and helps it to target its customers in new and interesting ways.
LBP is just one of the strategies developed by Amazon using big data analytics. Another strategy developed is called AdSense for Customer. This is a very cleverly designed ad campaign that leverages big data analytics to help advertisers target their ads based on their own customised personal customer behaviour. This is done by analyzing customer behaviour on major search engines like Google, Yahoo! and Bing to make sure that ads are relevant and focused towards the interests of their customers.
Amazon has invested more than half a billion dollars in research and development over the last few years to drive its business forward. Using big data analytics to understand customer buying behaviour and to leverage it to create customised advertising campaigns is only one of the ways they are continuing to improve their customer experience. By combining this information with their in-depth knowledge of their own customer’s buying habits, the combination is ideal. As more companies discover the advantages of employing these sorts of approaches, the more successful ad campaigns will become as the focus is shifted from traditional market research and advertising methods to big data analytics and customised ad campaigns.