The way businesses and brands used to function has undergone a massive transformation in 2020 because of the Coronavirus pandemic. The pandemic made the world realize the importance of online presence. Most businesses turned digital in 2020 because of the pandemic. As a result, data became extremely important. From consumer insights to sentiments, the alternative data’s impact on eCommerce is immense. It plays a vital role for brands to rise digitally.
With eCommerce becoming the new normal, 2021 will likely witness a revolution in terms of data. We are in a year when everything will be data-driven, be its product marketing, product management, customer support, sales, communication, and so on. There will be perhaps no sphere left untouched by data. Hence, it becomes essential for businesses to know the importance of alternative data and how to leverage it to the fullest. In this article, we will be discussing everything related to alternative data—its meaning, uses, and the ways to collect it. So, let’s get started.
What Is Alternative Data?
Alternative data was initially introduced as a financial concept that helped banks make informed decisions regarding credit card usage, bank account cash flow, utility bills, loans, rents, etc. However, with the growth of online businesses, there is a revolution in how alternative data is put to use.
In today’s digital advancement world, alternative data refers to data extracted and analyzed to gain meaningful and actionable insights. It is primarily used by eCommerce companies, entrepreneurs, content creators, influencers, social media brands to optimize their sales, reach out to their target audiences, improve their brand, rank high in search engines, and do many other things.
Popular eCommerce companies like Amazon use alternative data to know their customers. It gathers alternative data to predict consumer behavior. Based on the data collected, Amazon sends recommendations to its customers based on their order history.
How to Obtain Alternative Data?
There are different methods of obtaining alternative data. Most companies use web scrapers and data crawlers to extract large amounts of data. Gathering alternative data is a tedious and time-consuming task. Therefore, companies use bots to automate the process of gathering alternative data. However, bots can be identified and banned by websites due to their high security. Therefore, it’s advisable to carry out data crawling using proxies.
Moreover, using proxies also helps you to gather data without any restrictions. You can bypass geo-restrictions and IP blocking while scraping data from websites based in different locations. Residential proxies are the best for web scraping and data crawling. These proxies mask your real IP with a real user’s IP. The new IPs belong to an authentic physical location.
Below are the two methods of obtaining Alternative Data.
- Data Crawling: Data crawling is a method of extracting relevant data from the pool of large amounts of data available on the web. It requires data crawlers to skim through vast quantities of data to select only useful information. Data crawling saves time as the companies don’t have to search for the relevant data manually. It thus saves time.
Data crawling using proxies is essential as it helps you gather data securely. Moreover, you can collect data from different web locations without facing geo-restrictions or IP blocking.
- Web Scraping: Web scraping is a process of extracting large amounts of data from websites. It is used to gather all the information/data from particular sites or specific data as per their requirement. Companies and brands usually do web scraping for the purpose of data analysis, brand monitoring, and market research, in short, for their brands’ faster growth and development.
However, web scraping isn’t that easy to perform. Many times, there are issues of IP blocking and geo-restrictions. The reason behind these blocks is high security, which is in-built on many websites. Nonetheless, you can use residential IP proxies for higher security.
While 2020 turned almost every business digital, 2021 is, to a great extent, witnessing the alternative data revolution. Data has become the new oil, and everything will turn data-driven soon. At present, companies use alternative data mainly for gaining consumer insights, marketing, and sentimental analysis. But the time is not far away when data will control everything, be it product management, sales, communication, etc.
As a result, eCommerce companies need to know everything about alternative data. To survive in the digital world, learning how to obtain alternative data is extremely important. Without it, you cannot think of optimizing your sales or targeting the right audience. In the article, we have discussed two of the most significant methods of extracting alternative data. They are web scraping and data crawling.
Data crawling and web scraping lets you gather large amounts of data, which otherwise impossible if done manually. However, it’s advisable to perform data crawling and web scraping using proxies for security and to bypass geo-restrictions and IP blocking. So, if you want to ace in your online business journey, alternative data is the key.