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The Surprising Way eBay Used Big Data Analytics to Save Millions

Strategy

The Surprising Way eBay Used Big Data Analytics to Save Millions image eBay knows big data. With more than 100 million active users globally, the online industry powerhouse provided a platform for the sale of $68.6 billion in goods in 2011 –that breaks down to more than $2,100 in goods sold every second. Clearly, eBay has high-functioning systems in place for data collection, real-time analysis, targeted distribution, automated response, etc.

But, you might be surprised to learn that eBay’s drive to conquer complexity has taken the company in completely different directions, as well.

As explained in this short video clip, a few years ago, eBay decided to focus its analytical lens not just on online customer behavior or website traffic patterns; the company also turned the big data spotlight on a core business element that’s even more fundamental: IT infrastructure.

As a result, eBay began capturing “detail-by-detail, minute-by-minute” data on every component installed on its data centers.

After crunching those numbers –talk about big data! –the results were telling. eBay uncovered underutilized servers, misconfigured devices and other inefficiencies. In fact, armed with these findings, the company was able to repurpose thousands of servers and save millions in capital expenditures within the first year.

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“(We saw) patterns that were not obvious to the individual technician, ones that only got visibility once you took all of the corporate data and looked at it,” explained Oliver Ratzesberger, then eBay’s Senior Director of Architecture & Operations. “That was millions of dollars for us in terms of capital savings –just through applying analytics in an area that at first we never thought about using analytics for.”

So, in one fell swoop, this story underscores two of my favorite themes: the enormous potential of big data analytics and the critical importance of tearing down corporate silos.

As Oliver points out in the video, most companies associate big data analytics with marketing and finance and maybe supply chain management. But very few are thinking in broader terms about how they can apply analytics “across the board” to integrate systems and drive revenue growth.

How could big data analytics impact your business functions? Companies that think differently and find ways to bridge barriers do reap rewards. By harnessing the power of big data across business units, eBay is conquering complexity and gaining market share, even as it improves efficiencies and cuts costs.

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