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Research and Development: What to do with an 80% more budget?

Research and Development: What To Do With an 80% more budget?

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When a company moves from the platform
Shopify to Shopify Plus , often it realizes that much of its budget for the operations of the platform is intact, so you begin to wonder what to do with this extra money.

Various reports agree that 80% of IT
budget spent on maintaining outdated systems, but what happens when those costs are significantly reduced because they are already included in the payment of a platform?

What you can invest that surplus?

Advertising?


Marketing?


Any better packaging?


All are viable options that many traders Shopify Plus, like
Oreo and Vorana They have used, but have you considered investing this money in research and development so we can experiment with these ideas you’ve been putting off?

When you have reduced a significant portion of your operating costs, you can make more effective use of money to invest in other areas (marketing, product management, staff, etc.), thanks to the research and development strategies.


So where should you
start an online store?


If you’ve been in business long enough to have achieved success while, you
probably have a lot of data about your customers and orders.


The problem is to
understand all that data and connect information, not only from point A to B, but also from B to Z or Z to H, and obtain useful information from all those connections.


This is where Jonathan Morgan, co-founder enters
Popily and co-host of Partially Derivative (English podcast about science data, highly recommended), with ideas to help companies better understand their data.

The biggest problem that most businesses to the data, is starting directly from there, instead of asking what information they are
seeking to obtain from the data.


By nature, human beings want to
find patterns in everything. If we have a group of data points, immediately we seek to create images, patterns and stories. For proof of this, only just look at the night sky.


The problem is that the patterns we see are not always such or are not particularly useful.
“People make a lot of assumptions about the data and assume they can only tell a specific story and, of course, if they seek, they will find that story, but in the process, may end up burying a track or find X, but And lose. ”


It may be tempting to
give all your data to someone and say, “Here are all the facts, tell me what you mean”, but usually this is not a recipe for success, because there are all
kinds of information in the data . Instead, Jonathon suggests starting with a question about what you want to improve your business or product.

In other words, instead of looking for
patterns in the data , you must define your current research priorities, and start there.

What customers have the
time value higher living ?

What products are the most profitable?


What seems to
cause more customers to buy your products?


It begins with a question that need an answer or a hypothesis you want to
test ( “customers who buy product X tend to have the highest value of life time, because they are people with those specific needs”). This way, you’ll get more useful information from your data.


Jonathon notes that the right time to ask for
help arises when you are engaged in making objective decisions about the direction of your company and products. Do not wait until you have to make decisions of millions of dollars.


The good thing is that your options are not limited as before, based on
the capital you have available (hire a data expert full time or buy expensive software is a significant investment).


“We are currently working with a team where small consultation, technology and apps make it
much easier to work with this data on a daily basis. We are moving towards data based on current daily habits and not just consider changing direction every twelve months, when we have in our hands a new report “.


If you are not familiar with data management, you
may not have any idea what you should consider when looking for help, or what should be your first project when you start working with someone in your company data.


First, the person or agency that works with your data should make your simple and understandable for all interpretation.
It is necessary that the person belongs to the design department understands the same as that of the marketing department. The more people understand what they are seeing, there will be better opportunities to take advantage of this information and act accordingly.


According to Jonathon, in the
first thing you should work on is exploring your data.


” It
must be the first project in which you invest your time, and it is important that all who are interested in the outcome of that investigation involved in the process”


One way to include everyone in the scanning process, even those without expertise, is able to
visualize the data. In any case, the
team data managementYou should strive to have conversations with other staff about the meaning of data and explain what can be important, what does not and how this information can be exploited.

“Skip this step means burning hundreds of thousands of dollars ,
” says Jonathan and adds that ” it is unrealistic to expect one person to interpret the data and understand enough to determine exactly which aspects of that research will be most valuable to your business ,


Thank your research, you have gained valuable knowledge and just implement what they
learned. Apply the data obtained perspectives on the development and design of your business, will allow you to get the most out of your research and save money. But how it looks in practice and how to know when to start incorporating them into your business?


Katie, member of
Knurture (an agency interface design and user experience, based in San Francisco), shared some tips:

“The most common mistake I’ve seen make many business owners is blindly trust your instincts.
Not confront their ideas to clients, it could mean losing a lot of time and money. A rigorous testing process user can take a few days and could save your company thousands of dollars and time you have taken to develop your initial idea. ”


Many early user research related to the use of apps and websites, but can also be used for research into physical products and to improve your online store, key to keeping your sales aspect.


The basic process of a user research is:


And yes, even though it is an investigation, is still part of the design phase and development, because research is being done with prototypes, created with knowledge which they were obtained from your data.


 Data science generates quantitative data, while user research generates qualitative data, which can help you fully
understand why people behave in a certain way, rather than just tell you what percentage of people are behaving said form.


Katie says that can include research at any time of design and development process, but the sooner you do, the
better, especially if your product depends on the user experience. In e – commerce, it could be a product that you are creating from scratch, like
pitch on Indiegogo ).

If you’re selling a product that people feel immediately familiar, then try your product (if the product warrants it
, of course) or website can wait until you have reached the adaptation of the product to market. For more information about adapting the product to market and how to achieve it , read our article about
the real reason why people are not buying your products .

Katie also says it is important to
note the signs of a poor user experience. For an ecommerce store, you should consider situations such as


the situations mentioned above are in
addition to the typical problems experienced by users of websites. Signs of a bad user experience is your store include symptoms like a high bounce rate,
abandoned shopping carts or customers should contact someone in customer service to complete your order. To begin refining the customer experience after purchase, check out our article on the design of a new experience for the customer .
How much money should invest in research and development?

It varies, depending on the industry, but to give you an idea, we present the average business spending (as a
percentage of revenue) in the industry of leisure products, compiled by the European Commission:

 
grafica_european

Image via
Statista

Regarding other industries the electronics and appliances industry is a little lower (at around 5.4%), and hardware and technology equipment, about 8% for several years.


If you are not allocating capital for research and development (or can not), you’re probably losing money. 


Credit Suisse implemented a user –
centric strategy for your website, and obtained, among other results, an increase of 15% in additional sales (and 30% increase in the use of their website).


A 2009 report by consultancy SDS determined that when organizations spend user experience from the beginning, the duration of development cycles of products is reduced between 33% and 50%, allowing the product to market faster.
The same report found that take longer to introduce the product to the market means generating less profit, where a delay of 25% results in 50% less profitability.


Scientific equipment and data analyst
EMC , Pedro Desouza developed an algorithm that helped a company to predict and prevent the closure of accounts by 30%.

Kroger uses large volumes of data to get ideas and implement them
in its program of customer loyalty, which has generated more than $ 12 billion in additional revenue since 2005.


In conclusion, part of a platform ecommerce at the forefront, as Shopify Plus, lets you spend much of your budget to research and development, for a fraction of the cost, something impossible to achieve when maintaining your website will cost a pretty penny.


If you are ready to raise your level and save some money in the process, Visit
Shopify Plus and learn more.

Original text written in English by:
Michelle Nickolaisen.

Spanish translation:
Gabriela Aguero

Write him
an email to our Technical Support team, and they will respond
in Spanish as soon as possible.



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