1763 – The Importance of Effective Data Utilization with Eric Dodds

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0:58with us right now it's eric dodds eric you're the head of product marketing with rudder stack you're found on the web at rudder stack.com eric thank you for joining us so good to be here josh thanks for having me absolutely well give us an overview of what rudder stack is so rudder stack is a warehouse native customer data platform. And there are a lot of buzzwords in there. So let me explain what I mean by that. We make it easy for data teams to collect all of their customer data. So your customer data lives in a thousand different places, websites, apps, in your CRM, in your marketing tools.

1:38And one of the problems that businesses face when they try to grow is that each team tends to operate in a silo, right? So the sales team has their view in Salesforce and the marketing team has their view and their marketing automation tool. So the first thing Rudderstack does is it breaks all those data silos and allows you to collect all of that data, really to empower your teams to have a complete view of the customer and a complete view of their journey. So that's sort of the pipeline and integration aspect of Rudderstack. And then we have a lot of really cool tools that help you model that data to become useful, right?

2:08So if we think about getting all your data in one place is half the battle, but then you need to do something with it, right? You need to know when a customer is going to churn. You need to know who your highest lifetime value customers are. And then you need to give that data to your team so that your sales team can prioritize leads, your marketing team can send the right emails, and your customer success team can sort of focus on expansion. So we're the data infrastructure that makes it easy for your data team to sort of enable all those use cases. Yeah. What are the consequences of not really working with our data well?

2:43Two major things that I think a lot of founders and leaders face on a daily basis. So one is that it's a lot harder to make decisions. And one symptom that you see over and over again, is you have a board meeting coming up, you need do your quarterly reporting. and what ends up happening is there's someone on the team, probably an ops person who spends three or four days exporting CSVs and spreadsheets out of various tools, doing a bunch of complicated VLOOKUPS to try to wrangle the data, to try to help you understand, well, what happened last quarter and what decisions do we need to make, right?

3:24And even then there are a lot of gaps in the data. That's really challenging, right? So you don't have the insights because you don't have the data and that makes decision-making difficult. The second thing is that it makes it really difficult for teams to collaborate. And any leader who has two different teams looking at similar sets of data that should be the same but are different knows exactly what I'm talking about, right? The product team says, we got this many signups and this many converted to paid. And the marketing team says, well, that doesn't match what we see in the lead database, right?

3:56And so how can those two teams work together because they're not even reading from the same page? So pretty big consequences. Ultimately, you just can't grow your business as fast. Yeah. And so where did Rudderstack come from and who do you work with and what does that end up looking like? Absolutely. So Rudderstack was actually born out of our founder facing this pain point. So he had a startup company. He sold it to a big telecom company. and his job at the telecom company was running the machine learning and AI team that was tasked with figuring out which customers are going to churn, right?

4:32So how can we mitigate churn in our business? And they had hundreds of data sources and they were going to build this model. It was going to really move the needle for the business, right? Well, over a two-year time span, what did they spend 90 % of their time doing? Well, it was wrangling and cleaning the data, right? And did they have a turn score at the end? Barely. And so our founder said, there has got to be a better way to do this. And he went to the market, looked for a bunch of different tools. They had a lot of issues around security and privacy as a telecom company, a lot of personally identifiable information, PII, a lot of compliance regulations from operating in different regions like California or the EU with regulations like CCPA and GDPR.

5:19and he really wanted as a data leader control over his infrastructure that would allow him to drastically decrease his time to value for delivering the business outcome that he was tasked with delivering. There wasn't a tool out there that accomplished all of that and actually allowed him to keep his data in his own infrastructure and solve those compliance and privacy problems. So he built Rudderstack. So this is about four years ago now. And we work primarily with data leaders inside of a company who are helping other functional leaders deliver business outcomes, right? So if you think about, you know, just to name a couple of our customers, so companies like Crate and Barrel on the retail side, Acorns on the fintech side.

6:01So, you know, very large companies, the data leaders at those companies need to do things like increase the website conversion rate or, you know, support an increasing website conversion rate from an e-commerce standpoint. Mitigate abandoned carts. On the fintech side, it's making the right recommendations for investments that your users might want to make or giving them intelligent updates about their portfolio. Well, how do you actually deliver those use cases inside the business? Data is the fuel that drives all of those. And so we work directly with the data leaders who have internal customers as those business leaders who are responsible for key business outcomes.

6:40I'm wondering if you could talk just a bit, and I don't know if this is in your zone of genius or whatever, but let's say that a consumer is interested in this topic, right? And so maybe they have concerns over privacy. Maybe they've seen some of the evidence of the fact that, wow, big data certainly knows me very well. Let's say you were to address a fourth grade class talking about what you know on the back end in the business world and maybe what consumers don't realize today. Do you have any thoughts on that? Absolutely. Yeah. I would say the one thing is we tend to think about that in a pretty linear way, which is that linear and ambiguous, right?

7:25Like, well, big data knows a lot about me. Well, the first thing you need to ask is like, well, who is big data? And a lot of times people like to point the finger at an individual company. And that's mainly because of headlines where it says, XYZ company had a big data breach of Target had hundreds of thousands of emails released or hacked. And so you say, well, you know what? They are the bad guy. That's the problem with big data. It's not secure. They know too much. What you don't see on the back end is that those companies are using tens or even hundreds of vendors that also have a copy of your data, some of whom will actually sell your data.

8:11And so there's actually a much wider network of people responsible. There's a lot more variety there in terms of the people who have your data than just the one company that has a data breach. And in fact, they may not disclose this because of contracts, but their data breach oftentimes may be due to a failure in one of those vendors that they have that they're using to store process user data. And so it's a lot more complex than you think. It is actually difficult for data leaders to manage this, right? Because they have to have, you know, they're trying to provide you with a good customer experience, right?

8:49And the other thing I would say is the people who are managing your data inside these companies, they generally have really good intentions, right? They're trying to figure out how to make you more relevant recommendations, build better products for you, et cetera. Rudder stack is really unique in that we don't store any of your data. So we can collect it and process it. But when we deliver it to the customer again, so say crate and barrel or an acorns or a footlocker cars.com, we deliver the data to them into their own secure environment, which is a really core principle for our founder and for our company as a whole is that we don't want to make the security problem worse.

9:28We don't want to put the end consumer more at risk. And so we don't actually store any data in our system. We collect it, process it. Once it's delivered to our customer and their own secure infrastructure, we drop it all from our system. So that's a core principle for us. Yeah. And Eric, for someone, I don't know if is Rudderstack a solution primarily for enterprise level companies? Or do you also provide value to earlier stage and even startups? The entire spectrum. I mentioned large enterprises a lot of times because security tends to be a really critical pain point for them. We have an extremely generous free tier.

10:05So tons of startups run on rudder sack to integrate their data, right? I need to install this in the app that I'm building for my startup. I need to stream that data to product analytics tools, to marketing tools, sales tools, et cetera. All those integrations we handle out of the box. We have standardized schemas. So if you want to send the data to your warehouse or data lake to start to do more advanced analytics there, full support for all of that as well. So we really run the entire spectrum from startup all the way up to enterprise companies. How is the, I don't know how you structure the pricing or the, you know, kind of the model, because it sounds like a really powerful tool.

10:41Listen, pricing's on the website, rudderstack.com. Let me ask you this. Yeah, yeah. And I will say that, you know, I was just looking and there's, I mean, if you're early stage, you can start using the platform, right? But yeah, let me ask you that. Yeah. Today. Yeah, yeah, yeah. And one of our other core principles is keeping things simple for our customers. A lot of companies, their pricing gets fairly complicated, but simplicity is again, another sort of core principle for us. And so you can think about being charged on a volume basis for the data that you send through RudderStack. And so we scale, that's how we can offer a really generous free tier, but then also scale all the way up to the enterprise.

11:23So it is volume-based pricing. So you can just sort of think about, we meter the pricing based on the amount of data that you send through the system. And it's as simple as that. Yeah. And what would be best practices for, let's say, an earlier stage company, if they really wanted to say, you know what, we're going to be really smart about this early, what would you recommend for someone? Yeah, absolutely. Well, the first thing I would recommend is we actually wrote a little book about this called the Data Maturity Guide. And you can just Google Rudderstack Data Maturity Guide and find a copy of it.

11:59And it's really a playbook that starts at the very beginning. we sort of define four stages of the data stack. The first one we call the starter stack, and it's sort of creating a unified data layer. And this is really solving the problem that we talked about before, where the marketing team's numbers are different than the product team's numbers are different than the sales team's numbers. You have to start there and solve that problem at the root, or you never will get to doing more advanced maneuvers like developing a turn score or other things like that. So you have to get a unified data layer.

12:29That's where I would encourage people to start. And again, just Google Rudderstack data maturity guide, or feel free to reach out to me directly. I'd be happy to send you a copy of it. And it is a step-by-step guide. I think it's all in all 80 pages, so really robust, but the first section for startups, just really, really good content on that specifically. Yeah. In terms of where Rudderstack has come from and as a company, who is Rudderstack and who are you in this space in the industry? Yeah, absolutely. So we actually started as an open source project. So the core of our products actually open source.

13:06So that may be another thing that's interesting to certain companies that want a high level of transparency. So we don't have anything to hide. You can go on to GitHub and look at all the code for the core platform and see exactly how it works. Again, it's your data and we want you to know exactly how our platform is handling it. So we started as an open source project. We launched on Hacker News and the response is really overwhelming. That's actually how I found out about the company. So our founder launched the open source code on Hacker News. Me and someone I was working with at the time downloaded it.

13:35We ran the platform. We were like, wow, this is really impressive. And from there, the company's grown. So it was just a handful of people back then, small startup out of San Francisco, California. And now we're, I think, 175 employees spread all across the world. We have customers across all the major continents and across a variety of industries from retail to fintech to healthcare, et cetera. So yeah, it's been a really fun ride and is a really great place to work. Yeah. And you've been around for a little while. Yeah, three and a half years. You know, I joined back when it was a very small company and have had a chance to just have a very entrepreneurial journey, part of helping grow the company from a handful of people to, you know, a couple hundred.

14:17Well, that's exciting. All right. So rudderstack.com, when somebody goes there, you'd mentioned the book. What other resources would you recommend? or someone's like, listen, this all sounds really interesting. I'd like to learn more. Yeah, go to our website. It's going to point you into the right place. Lots of great resources on our blog as well. So rudderstack.com slash blog. But the website does a pretty good job of getting you to the place you want to go, depending on which part you're interested in. Yeah, excellent. Okay, again, the website rudderstack.com. Eric Dodds, again, head of product marketing.

14:51Thank you so much for joining us. Absolutely. Thanks for having me, Josh.

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