Understanding Why Big Data Matters

Andrew Wetzler - February 24, 2022

We share data throughout the day, every day, without even noticing it or giving it a second thought. Every time you log on to an account, visit a website, or like a post, you are sharing insights about your preferences and behavior. It is impossible to even wrap your head around how much data is out there. Consider the fact that YouTube has 300+ hours of video uploaded to the site every minute. For businesses, this presents a unique opportunity to harness the power of big data offer a better customer experience, and identify new markets and opportunities.

When it comes to understanding big data and how it is helping businesses, it is important to note that big data comes in three different forms.

  1. Structured. This is the easiest type of data for humans and computers to collect and analyze. Examples of structured data include addresses, reviews and ratings, and other identifying demographics.
  2. Unstructured. Unstructured data is the most prevalent type of data, but it is also harder to analyze. It includes social media, videos, photos, etc. Fortunately, AI is now able to manage unstructured data.
  3. Semi-structured. This is simply a combination of the first two types. An email is a perfect example. It will contain the time it was sent along with the names of the sender and recipient (all structured data). The actual content of the email is unstructured and will take time for AI to sort through.

It is only recently that we have been able to effectively analyze large amounts of data in a meaningful way and find creative ways to leverage this tool. Here are a few examples of how some of the major players are using big data.


If you have ever spent time shopping on Amazon, you know that the site can take you on a real rabbit hole of clicking on products. That is because Amazon uses data on customer behavior to make product recommendations. You don’t even have to buy anything for Amazon to start collecting data. Simply clicking on a product or putting it in your cart will give the company enough information to start recommending products. Turns out that this is an extremely effective approach. About 35% of Amazon’s revenue comes from recommended products.


Netflix is another company that has mastered the personalized experience with the help of big data. Sorry to break it to you, but your binge-watching isn’t a complete secret. They collect information on when you paused a show, whether you started watching again, what time you watched the show, and basically every other detail. While Netflix’s growth rate is relatively slow at around 8%, its ability to recommend shows and offer a better customer experience has resulted in an impressive retention rate. The company’s quarterly churn rate hovers between 2% and 3%. That sort of customer loyalty is enough to make you take a second look at how you might be able to use big data.


Starbucks is another company that is focused on the customer experience. While its rewards program and app are super convenient, they are also vehicles for collecting data. Both of these avenues allow Starbucks to better understand buying habits and deliver personalized rewards, which further drives business.

Ultimately, big data opens the door to all sorts of creative and innovative ways to engage with customers and build a brand. The sky’s the limit when it comes to implementing new, data-driven strategies. The key is to get started sooner rather than later because the competition will only get harder.

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