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Big Data and Its Impact on International Trade

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The main aim of the essay is to explain what big data highlighting the key opportunities and challenges for associated with using this system, as well as how it affects international trade. International business is the exchange of goods and services among individuals and businesses in multiples countries, such as when multinational companies or international business engage in businesses with different countries. Globalization as allowed business to trade international markets which as very positive to as they increased their target segmentation, however as a result companies were exposed to more information, they were able to fare thus requiring a system which was able to store and manage all that material which leads to the creation of big data. Furthermore, I will provide my opinion, on weather I think big data is beneficial or harmful for international trade by presenting facts, statistics and articles.

Big data is a term usually applied to substantial data sets that are generated through a range of sources including mobile devices, electronic medical records, environmental and body sensors, imaging and laboratory studies, and administrative claims data (Barton, A.J. 2016). Big data is the combination of the last 50 year of technology evolution (Kaufman, 2013). This data can be both categorized in structured or unstructured, internal or external. With this information businesses start to recognize patterns of consumer activity that had before would be impossible to understand or act upon. Structured data refers to data fields with social security numbers, phone numbers or even ZIP codes which may be human-machine generated RDBMS (relational database management system) structure. The format is easily searchable both with human generated questions and via algorithms using type of data and field names, such as numeric, alphabetical or, currency or date (Brandauer, S., 2018).

Unstructured data is fundamentally every other type of data. Unstructured data it may be textual or non-textual, and human- or machine-generated. As well as be kept within a non-relational database like NoSQL. Usual human-generated unstructured data includes text files (spreadsheets, presentations, and email), social media (Facebook, Twitter and LinkedIn data), websites (YouTube, Instagram, photo sharing sites) etc., different from machine-generated unstructured data that includes satellite imagery (land forms, military movements, and weather data), scientific data (atmospheric data, oil and gas exploration, space exploration), sensor data (oceanographic sensors traffic, weather).

“Big data is high-volume, high-velocity and high-variety information assets that demand cost-effective, innovative forms of information processing for enhanced insight and decision making” (Raguseo, 2018). Big data is categorized in four type such as strategic which is the ones who change the way the companies operate or the nature of their products, informational which provide knowledge and material that improves the decision making, transactional which helps businesses cutting costs incurred and transformational refer to the results of changes that a firm has to make to the structure and to the capacity of implementing a technological investment each one having different perks.

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The most essential perks of big data are the enables international companies to gather, manage, and use abundant amount of data at a fast speed, at any time which allowed to gain the right insights into their customer behavior. This information is exceptionally significant to companies as it will dictate the approach they will take to create and manly promote their products and services.

Business manage data in different ways depending on their necessity and to try solving specific types of data management problems.

Opportunities of Big Data for International Businesses

For start-up businesses or businesses looking to trade internationally, the adoption of big data technology offers several types of benefits which will assist them in making decisions for the business success. The following are:

  1. Cost reduction. One of the main benefits of implementing big data for firms trading internationally is related to the financial aspects. Big data brings significant cost advantages when it comes to storing large amounts of data reducing burden in the company IT department which can free resources, as well as they can identify more efficient ways of doing business. Although the implementation of this technology will be expensive in the beginning, but eventually they will save a substantial sum of money. E.g. one way big data helps to reduce costs is by cutting logistics costs, on average, the cost of product returns is 1.5 times that of the actual shipping, thus by firms integrating big data analytics they can identify the goods that are most likely to be returned allowing them to easily calculate the likelihood of products being returned and take the necessary steps to reduce losses and costs. Additionally, another department companies using big data can reduce costs is in their marketing strategies. Big data technologies allow companies to understand customer behavior thus knowing through which channels it will most effective to launch marketing campaigns (Heidrich, J., 2016).
  2. Faster and better decision. Big data allows businesses to analyses high amount of information, short period of time. The system leads to more accurate decisions, continuous productivity improvements through automation, leaner operations, and optimized servicing through predictive analytics as well as reducing risks of operations. Since as by analyzing big data, company management gets a better understanding of the state of foreign market condition, e.g. if market is booming or declining, market gap, families disposable income. Through this information companies can make a calculated decision on whether to leave or move to a new market. For example, give an example of industries that are booming in developed countries which several countries are planning to invest. Amazon is an example that company which as identified through big data that India is a booming economy that encourage them to invest heavily in the country. Currently India it’s the sixth on the International Monetary Fund (IMF) world GDP rankings, with a GDP of over $2.26 trillion Shri K. K. Bajaj 2017). Amazon announced a they would make a $2bn investment in India as well as announced plans to build five new fulfilment centers in Indian cities (The Bookseller, 2014). The company entered this venture as their statics suggest they will have success as the economy is growing, population has more disposable income thus they will be able to have high sales figures leading to more profit.
  3. New products and services. Big data lets firms know the most recent trends of customer needs and satisfaction through analytics thus can create products according to it. Furthermore, by having better insights on customer’s wants business will increase their possibility of earning additional revenue. For example, one company which as seen the positive results of implementing big data technology brings its Wal-Mart’s as after of implementing sematic analysis search engine, Polaris which is a platform designed to produce relevant search results for customers. The implementation of the semantic search has increased the possibility of online customers finalizing their purchase by 10% to 15%.
  4. Predictive analytics. Big data allows companies to create predictive analytics which helps them arrive new techniques to become more profitable. As big data gathers, processes and spits out information that may be helpful and useful, thus predictive analytics uses that information, as well as insight into past buying patterns or replies to emails or likelihood of non-payment and uses that historical data to predict future behavior. Predictive analytics can help international businesses distribute resources, to the clients with the biggest likely return.

Challenges of Big Data for International Businesses

  1. Need for talent. As big data is a very difficult system to manage there is a shortage of specialists, who know how to operate these systems. Businesses may waste lots of time and resources on systems they don’t even know how to operate. There is a lack of big data skill set thus companies hiring or training staff can increase costs considerably, and the process of acquiring big data skills can take considerable time. Because without a clear understanding of big data, projects become increasingly risky and doomed to failure.
  2. Data quality. Researching and gathering the right information is another big downside of big data. Companies have to be extra careful when selecting information in order to making sure they are using accurate, relevant for their analysis, as a result this slows considerable the reporting process being disadvantageous, however if they don’t address these data quality issues businesses may find, the research results generated by their analytics are worthless and even harmful if acted upon.
  3. Privacy and security issues. These are the most prevalent risks companies using big data have to face, making venerable of cyberattacks. Companies are vulnerable to these types of attacks as they storing sensitive data, which forces companies to spend a lot resources in the security and protecting their data. For example, Facebook suffer a cyberattack where 30 million users had their information stolen, 14 million of which had their names, contact details and sensitive information such as their gender, relationship status and recent location check-ins exposed (Rodriguez, 2018). As a result of this security breach Facebook was forced to increase the security of their data by hiring 10,000 people. Big data is affected by state privacy laws, especially privacy laws to directly address online disclosures and record keeping. General Data Protection Regulation (GDPR), went into effect replacing the 1995 Data Protective Directive (DPD). This new law affects the EU and countries in the European Economic Area (EEA), and creates a new regulation for privacy in the digital age (because of Brexit the United Kingdom has a separate Data Protection Act 2018 that mirrors the rules in the GDPR). If the UK leaves the EU in March 2019 with no agreement surrounding data protection & data transfers, the UK Government has stressed, “there will be no immediate change in the UK’s own data protection standards. This is because the Data Protection Act 2018 would remain in place and the EU Withdrawal Act would incorporate the GDPR into UK law to sit alongside it” (Blanchard. S., September 2018). In terms of big data, the GDPR limits the type of data gathered by organizations. It also creates certain issues for data collection because individuals have the right to have their information removed from databases even after giving permission to have it include. The law has far-reaching effects because it not only affects organizations within the EU, but also applies to organizations offering goods or services to people residing in the EU (Myers. C., June 11, 2018).
  4. Regulations compliance. Another downside of using big data for companies is that they have to comply with all regulations implemented different government in rules companies have to follow with big data which every country they trade. Much of the information used by businesses is very sensible and personal to individuals thus firms may need to ensure that they are meeting industry standards or government requirements when handling and storing the data.


This essay has outlined the opportunities and challenges of the use of big data technology, and the adoption of it by multinationals companies. Through the paper we can understand what big data is to substantial data sets that are generated through a range of sources including mobile devices, electronic medical records. Due to the usefulness of this system businesses adopted it aiming to achieve better results as it presents several benefits such as is the enhancement of productivity growth, goals in terms of efficiency, reduction of the operating costs, and enhancement of the returns on financial assets, ability of proving better products and services, improving the internal processes of a company and overall the development of new business opportunities however the using big data presents its drawbacks such as satisfying different regulations around the world in the countries where the big data originated from, privacy and security issues, privacy risks, data quality and lack of information system structure support.

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Big Data and Its Impact on International Trade. (2022, September 01). Edubirdie. Retrieved February 6, 2023, from
“Big Data and Its Impact on International Trade.” Edubirdie, 01 Sept. 2022,
Big Data and Its Impact on International Trade. [online]. Available at: <> [Accessed 6 Feb. 2023].
Big Data and Its Impact on International Trade [Internet]. Edubirdie. 2022 Sept 01 [cited 2023 Feb 6]. Available from:
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