eBay: Placing data at the heart of business strategy
Thu 12 Feb 2015
“Data has always been at the center of the decision making process at eBay,” says Cervellin. In the retail space, he notes that being an online business has provided eBay with a significant advantage over companies who are struggling to deal with the bridge between online and offline touchpoints.
He believes that having data as a main focus means “completely designing your business around this mission, with analytics integrated into finance, and mirroring every major function including marketing, sales, and operations.”
Analytics has to be empowered in an organisation,” Cervellin says. “eBay has fully achieved this by placing the function under finance, which has ensured involvement, credibility and neutrality.”
He adds that it has been an essential step that analytics be involved in every stage of the decision making process, from initial phases to implementation and results. “Results have to be monitored and deviations from the forecast must be explained.”
Cervellin refers to his merchant analytics team which performs analysis leading to deals with large vendors looking to sell their inventory on eBay. With the support of analytics, Cervellin and his team are able to help these large merchants to understand how their inventory looks to a buyer, and guide them on how they should list their items to maximise sales.
“Through our work we have acquired some very large European players who are bringing unique inventories onto the website, ensuring that our buyers have lean, retail-style, shopping experiences.”
Cervellin points out that many analytics projects can fail or do not deliver as hoped. He explains that in order to ensure positive results in line with the strategic goals of a company “prioritization and business partnerships are paramount.
“We have the ability to measure many things, almost everything, but the major challenge is to make sure that what we do is relevant to the business […] Every insight that we deliver must generate a business action.
“We spend a lot of time trying to define what we believe will have an impact on business results. All that we need to do after that is to make sure that we resist the temptation to conduct analysis out of curiosity and we solely focus on what can drive our core numbers.”
Organisations must not allow analytics to “wander around.” Cervellin explains that before his team put a lot of effort into launching a project, they make sure that all of the analysis supports eBay’s mission. “If you do that diligently, the failure rate is much smaller, but it does take a lot of discipline.
“The Internet of Things will produce even more data, and even more chances to understand behavior. This however will lead to a high risk of distraction and will require an even stronger need for focus.”