1763 – The Importance of Effective Data Utilization with Eric Dodds

Josh (00:00:05) - Hey there, thoughtful listener. Would you like consistent and predictable sales activity with no spam and no ads? I'll teach you step by step how to do this, particularly if you're an agency owner, consultant, coach, or B2B service provider. What I teach has worked for me for more than 15 years and has helped me create more than $10 million in revenue. Just head to up my influence and watch my free class on how to create endless high ticket sales appointments. You can even chat with me live and I'll see and reply to your messages. Also, don't forget the thoughtful entrepreneur is always looking for guests. Go to up my influence and click on podcast. We'd love to have you. With 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. Eric, thank you for joining us.

Eric (00:01:10) - So good to be here. Josh, thanks for having me.

Josh (00:01:12) - Absolutely. Well give us an overview of what rudder stack is.

Eric (00:01:17) - 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. And 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 rudder stack 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 rudder stack. And then we have a lot of really cool tools that help you model that data to become useful. Right? So 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.

Eric (00:02:16) - 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.

Josh (00:02:36) - Yeah. What are the consequences of not really working with our data? Well.

Eric (00:02:44) - Two 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 to do your quarterly reporting. And what ends up happening is there's someone on the team, probably an ops person, who spends 3 or 4 days exporting, you know, csvs and spreadsheets out of various tools, doing a bunch of complicated lookups 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.

Eric (00:03:23) - Right. And 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 you know 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, you know, in the lead database, right? And 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.

Josh (00:04:05) - Yeah. And so where did rudder stack come from and who do you work with. And and what does that end up looking like?

Eric (00:04:13) - Absolutely. So Rudder Stack was actually born out of our founder facing this pain point.

Eric (00:04:19) - 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. So how can we mitigate churn in our business? And they had hundreds of data sources, and they were going to build this model that 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 churn score at the end? Barely. And so our founders 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 and GDPR.

Eric (00:05:19) - And 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 rudder stack. 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, Acorn's on the fintech side. So you know, very large companies, the data leaders that 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. Right. It's making the right recommendations for investments that your users might want to make right, or giving them intelligent updates about their portfolio.

Eric (00:06:25) - 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 sort of key business outcomes.

Josh (00:06:40) - I'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, you know, they've seen some of the evidence of the fact that, wow, big data certainly knows me very well. Like if you were to like, let's say you were to address like a fourth grade class, talking about what, you know, on the backend and the business world and maybe what consumers don't realize today. Do you have any thoughts on that?

Eric (00:07:15) - Absolutely. Yeah. You know, 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.

Eric (00:07:25) - Like, 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, you know, XYZ company had a big data breach of target. Had hundreds of thousands of emails released or hacked. Right. And so you say, well, you know what? They are the bad guy. That's the problem with big data. You know, it's not secure. They know too much. Right? 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. And so there's actually a much wider network of sort of people responsible. There's a lot more variety there in terms of the people who have your data than just, you know, the one company that has a data breach.

Eric (00:08:24) - 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. And 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, etcetera. 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 Foot Locker or Cars.com, we delivered 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.

Eric (00:09:28) - We 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 in their own secure infrastructure, we drop it all from our system. So that's a core principle for us.

Josh (00:09:43) - Yeah. And Eric, for someone I don't know if is rudder stack a solution primarily for enterprise level companies? Or do you also provide value to earlier stage and even startups?

Eric (00:09:54) - The entire spectrum I mentioned, you know, 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. So tons of startups run on rudders to integrate their data. Right. You no 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, you know, marketing tools, sales tools. ET cetera. All those integrations we handle out of the box. We have standardized schemas.

Eric (00:10:22) - So if you want to send the data to your warehouse or data lake to start to do more advanced analytics, their full support for all of that as well. So we really run the entire spectrum, you know, from startup all the way up to to enterprise companies.

Josh (00:10:34) - How is the I don't know how you structure the pricing or, you know, kind of the model because it sounds like a really powerful tool. Listen Pricings on the website rudder stack.com. Let me ask you this. Yeah, yeah. Is and I will say that 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.

Eric (00:10:56) - 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.

Eric (00:11:15) - And so we scale, you know, that's how we can offer a really generous free tier, but then also scale all the way up to the enterprise. So it is volume based pricing. So you can just sort of think about, you know, we meter the pricing based on the amount of data that you send through the system. And it's it's as simple as that.

Josh (00:11:33) - Yeah. And what would be, you know, 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?

Eric (00:11:46) - 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 Rudder Stack Data Maturity Guide and find a copy of it. And 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.

Eric (00:12:11) - And this is really solving the problem that we talked about before, where the marketing team's numbers are different than the product teams. 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 churn score or other things like that. So you have to get a unified data layer. That's where I would encourage people to start. And again, just Google Rudder Stack 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, you know, all in all, 80 pages to really robust. But the first section for startups just really, really good content on that specifically.

Josh (00:12:48) - Yeah. In terms of like where Rudder stack has come from and like as a company who is rudder stack and you know, who are you in the space and the industry.

Eric (00:12:59) - Yeah, absolutely. So well, we actually started as an open source project.

Eric (00:13:04) - So the core of our products actually open source. So 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 a and someone I was working with at the time downloaded it. We ran the platform. We were like, wow, this is really impressive. And from there the company grown. So it was just a handful of people back then, small startup out of San Francisco, California, and now we're 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 health care.

Eric (00:13:56) - ET cetera. So yeah, it's been a really fun ride and is a really great place to work.

Josh (00:14:01) - Yeah. And you've been around for a little while.

Eric (00:14:03) - So 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.

Josh (00:14:17) - Well that's exciting. All right. So rudder stack.com when somebody goes there. You mentioned the book. What are the resources would you recommend. Or someone's like listen this all sounds really interesting I'd like to learn more.

Eric (00:14:29) - 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 shutterstock.com slash blog, but the website does a pretty good job of getting you to the to the place you want to go, depending on which part you're interested in.

Josh (00:14:44) - Yeah. Excellent. Okay. Again, the website rudder stack comm Eric Dodds again at Product Marketing.

Josh (00:14:51) - Thank you so much for joining us.

Eric (00:14:53) - Absolutely. Thanks for having me, Josh.

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