segment cloud spend

How Segment Tackles Highly Dynamic Cloud Spend

Jackson Lucas
Cloud Tech Journalist
Dec. 17, 2019
3 minute read

Segment acts as a central infrastructure that collects, stores, and routes first-party user data to hundreds of tools in seconds for over 20,000 businesses worldwide who are looking to understand their customer-facing interactions. 

Download the full Segment case study here. 

With over 300,000 requests per second, Segment’s cloud environment is complex, highly dynamic, and extremely difficult to manage. With more and more customers being on-boarded every day—a big challenge considering each new customer that comes online creates high scale loads—Segment’s IT team was struggling to keep up with their multicloud environment. 

To ensure that the business would continue to scale efficiently while maintaining high levels of customer satisfaction and support, Segment chose CloudHealth by VMware as its cloud management platform to support visibility into container workloads, optimize cost savings, and assist with tagging. 

CloudHealth’s cost optimization dashboards have empowered Segment to easily analyze cost and gain visibility into our infrastructure to ultimately increase our gross margins by about 20 percentage points. That blew our board of directors away.

- Tido Carriero, Chief Product Development Officer, Segment

To more closely manage their cloud spend, CloudHealth set up auto-alerts to notify the Segment team if there were significant unplanned spikes in cost. Segment treats the auto-alerts as a high priority, which enables them to easily address cost drivers and mitigate the risks of unexpected cost increases. 

CloudHealth’s cost visibility tools have also created a culture of financial accountability across the organizations. Engineers, for example, are now able to analyze dashboards and drive greater cost savings initiatives. Segment is able to understand costs on a per-container basis and a multi-tenant cluster basis as well as costs associated with other AWS services. Specifically, application load balancers have allowed the engineering team to drill down into specific line items and create ways to architect the system to reduce costs. 

Segment’s rapid maturity in the cloud is impressive, and with CloudHealth’s help, the team has developed a strong foundation to act proactively on any cost issues. Moving forward Segment plans to focus on leveraging CloudHealth’s additional governance and optimization features to continue scaling their business. 

To learn more about Segment’s cloud journey with CloudHealth, read the full case study.