Taming the Data Deluge

Marketers and consumers struggle with the volume of data the world now generates. David Benady asks how the two sides can jointly control the tide, including the advent of brand ‘data stores’.

Data is inundating the economy, overwhelming consumers and businesses with swathes of information that they struggle to comprehend. The overload is set to spiral as social media, mobile and geo-location technologies spew forth yet more reams of data.

With billions of web searches made every month, more than 20,000 new books published weekly and more texts sent daily than there are people on Earth, data is increasing exponentially. The number of exabytes (EB – equal to 1bn GB) of information created in 2011 hit 1750, double the 2009 figure, according to IDC estimates. There is twice as much data as storage capacity.

This torrent of data makes it hard for marketers to ensure their brand messages are heard above the noise. Consumers have become reluctant to open the floodgates to receiving more irrelevant information, and some are wary of providing personal details.

Research company TNS has analysed the way in which consumers ‘eat’ at this table of information and created five consumer segments based on their readiness to absorb data. It calls the data deluge ‘information obesity’, and looks at the way people create their own ‘eating plans’.

You are what you ‘eat’
‘Fast foodies’, it says, consume the easiest, lightest data they can find. ‘Supplementers’ devour as much information as they can. ‘Carnivores’ consume only meaty chunks – whole books and in-depth research. ‘Fussy eaters’ are loath to consume information from any source, while ‘balanced dieters’ never consume too much information; what they do take comes from a variety of sources.

TNS marketing sciences director Russell Bradshaw says these ‘eating plans’ are a good way for marketers to target resistant consumers. ‘By understanding the predominant “eating plans” that exist among their brand franchises, brand managers and chief marketing officers have a tool for maximising the reach, resonance and values of their campaigns,’ he says.

TNS analysis suggests that ‘carnivores’ are more likely to shop at Marks & Spencer, while ‘fussy eaters’ tend to stock up at Asda. This gives M&S leeway to bolster its communications, giving customers big, meaty chunks of information they can savour slowly. Asda, meanwhile, would do well to deliver information in bursts and offer online nuggets such as tweets to appeal to voucher-hungry customers.

Marketers acknowledge that segmenting consumers by their propensity to consume information can be useful, but many see it as an add-on to the already tough task of identifying relevant audiences.

David Torres, global manager of chemicals technology at Shell Research, says that Shell intends to embed the TNS eating plans into its work, adding that brands need to search the data they have for clear and relevant insights.

Meanwhile, Stephanie Maurel, head of retention at Sport England, says the ‘eating plans’ could be useful if blended with other tools. ‘The TNS data obesity segmentation makes a lot of sense and rings true anecdotally. It is a great idea to segment by the information consumers are prepared to receive, although perhaps this is an extra step to be added to current tools,’ she adds.

Maurel’s role at Sport England is to use data to help various sports’ governing bodies to increase participation and attendance, a challenge for smaller sports, such as hockey. One solution is to take data from grassroots sources, such as social media, and integrate it with i n fo r m at i o n from elite sports events.

While small sports may be unsophisticated when it comes to data collection, Maurel says some governing bodies are using real-time data to build their popularity.

British Cycling, for example, gets feedback from locally organised Sky Ride mass-cycling events and feeds it through to its board meetings. This, in turn, helps it shape the way in which Sky Rides are organised.

For many brands, the UK’s data-chain is dominated by retailers. They control the all-important information about sales, which they then sell back to brandowners. Nonetheless, retailers, too, are suffering from information overload, according to Chris Osborne, retail principal at software supplier SAP. A recent survey by SAP found that more than half of retailers believe they have more information than they can handle. ‘Structured’ data – such as till receipts showing items purchased, times of day, quantities and prices – has been around for decades. Osborne advocates combining this information with ‘unstructured’ data – such as the random chat of social media – as the next great challenge for brands and retailers.

The prize will be to build a total view of each customer’s likes, behaviour and loyalty, and target offers accordingly. A crucial step is ensuring both types of data are gathered and acted upon in real-time.

Osborne believes the development that will enable this is ‘in-memory’ data analytics, where the data is stored in the computer’s memory for quick retrieval, rather than on a conventional database where it is stored on a hard disk, making it harder to access and wasting capacity.

He envisages a two-track economy where success will depend on efficient use of data. ‘The retailers that win out will be the ones that are very careful about how they use data and don’t swamp consumers with irrelevant offers,’ adds Osborne. ‘Retailers that create competitive advantage are (also) careful about how often they communicate with consumers.’

Useful data vs ‘noise’
Given the retailers’ iron grip on data, some brands have turned to comparison website Mysupermarket.co.uk to gain access to information about their own performance through mini-shops on the site. Reckitt Benckiser, Kellogg, Danone and Nivea are among those to have created such stores.

James Foord, vice-president of business development at Mysupermarket.co.uk, says brands are only just beginning to grasp the distinction between ‘data noise’ and what is useful. The site allows brand-owners to create a direct relationship with consumers and thus control their data. Brands can analyse the battle between their products and stores’ own-label versions, for example – data retailers rarely release. ‘This is the tip of the iceberg of what is possible. Brand stores will open up a whole new level of insight that has real value,’ adds Foord.

The battle for data control is about more than simply capturing as much information as possible and keying it into a database. Finding ‘smart’ data can save time and money in research and bring significant benefits for brands. The challenge is to find the pieces of information that help a brand locate its best customers and give insights into their motivation for buying a product.

Mike Dodds, chief executive of integrated agency Proximity, recalls a cat-food brand’s CRM programme in which customers were questioned about their behaviour. The question that delivered the best data was: ‘Do you celebrate your cat’s birthday?’ The responses helped the brand discover the most involved and valuable customers.

A potential barrier to the development of data-driven marketing will be consumers’ attitudes to privacy and control of their personal details. The online giants, such as Google, Facebook and Twitter, have built their businesses on getting users to give up their data in return for ‘free’ services. If the public refuse to play, this could put a spoke in the wheel of the data economy.

Chris Combemale, executive director at the Direct Marketing Association, says brands have to be upfront about privacy and make their policies simple and readable: ‘If you can’t put the policy on one page and make it clear, you have an issue.’ He also warns brands to avoid being ‘creepy’ online – by serving ads based on details consumers thought were private – which, he argues, can make digital marketing appear intrusive.

Modern marketing is essentially a battle for data. However, consumers themselves have the ultimate weapon: to switch off and stop sharing their information.

Technology was supposed to make life easier, but, in reality, it has made the world far more complex. The task of creating marketing campaigns that get heard above the din will only get harder still in a society deluged with data.

Marketing © Brand Republic

L’Oréal renews confidence in Zetes and deploys multimodal voice solution integrated with SAP

L’Oréal, has completed a series of enhancements to its existing voice solution based on Zetes’ 3iV Crystal.

With over 42 factories world-wide and 4.6 billion products
manufactured in 2008, L’Oréal has dominated the beauty market for the past century and become the world-wide leader in the cosmetic industry. Always seeking innovation and excellence, L’Oréal employs the best technologies to achieve both its performance objectives and ensure customer service excellence.

As a result of its good past experience of the Zetes voice solution, L’Oréal has re-engaged Zetes to update and extend its existing installation. This new solution rolled out is a multimodal
application: voice is combined with barcoding and weighing to check the orders. This combination of solutions has been integrated with SAP, which steers the management of the L’Oréal warehouse.

Mrs Wendy Doucet, Preparation/Dispatch Manager at L’Oréal explains: “To improve our performance and facilitate the work of our employees, we had decided in 2006, to implement a solution based on voice technology that can also be combined with other data entry and audit systems.” Zetes was chosen due to its experience in this field and its expertise in the SAP environment. “The results were visible as soon as the solution was up and running,” points out Wendy Doucet. “We recorded a sharp reduction in the number of errors in the preparation of orders and thus improved the satisfaction of our customers.”

Thanks to 3iV Crystal, 20 warehouse clerks from the General Public Products Division France (DPGPF), in Marly and 17 warehouse clerks from Gemey Maybelline Garnier (GMG), in Ormes now work hands and eyes-free to prepare the orders.

Additionally in Portugal, L’Oréal has put its confidence in the Zetes voice solution to improve its warehouse business processes. In this country, 12 warehouse clerks from the Alverca distribution centre are benefiting from the advantages of voice.

Alain Wirtz, CEO of Zetes, comments : “We are very honoured that L’Oréal has renewed its confidence in the competences of our teams and hope to have the opportunity to continue cooperating on new projects. The combination of voice with other technologies, such as barcoding or RFID, opens up new possibilities to improve the business processes in warehouses but also in other types of environment, for example in the back of store area for retailers.”

EDEKA-Group Fills Its Shelves with SAP

Germany’s Leading Grocery Retailer Ensures Competitive Edge with SAP® for Retail

HAMBURG, Germany – October 23, 2007 – Strengthening its position as one of the leading solutions providers to retailers around the world, SAP AG (NYSE: SAP) today announced that German-based EDEKA-Group will implement SAP® for Retail solutions to ensure an integrated merchandise planning process, reduce IT operating costs and support enterprise growth through a flexible enterprise service-oriented architecture (enterprise SOA). With revenues of more than EUR 37 billion, EDEKA-Group is Germany’s leading grocery retailer and is currently facing a business challenge to consolidate its IT activities with its new subsidiary LUNAR GmbH.

LUNAR GmbH acts as the IT center of excellence for EDEKA-Group and will be enlarged by up to 250 employees. The company aims to complete the reorganization of its IT landscape and bundle its operational business processes within a cross-group strategy.

“The consolidation of our IT infrastructure will allow us to cut costs by several hundred million euros,” said Alfons Frenk, CEO of EDEKA AG. “We will optimize the entire process chain within the group in order to operate in a more competitive and agile manner.”

“EDEKA is at the leading edge of the highly competitive retail market,” says Léo Apotheker, Deputy CEO, SAP AG. “Their long-term, strategic approach to an integrated enterprise resource planning system will provide standardised, transparent access to mission-critical data to speed up company response times and lower costs which is ultimately of benefit to EDEKA customers. SAP is extremely proud to partner with one of the premier names in retail.”

Integrated Enterprise Resource Planning
The SAP for Retail solutions will allow EDEKA-Group to maintain consistent quality regarding item numbers, master data and product group structures. Additionally, EDEKA-Group will be able to ensure data transfer across all retail locations and regional subsidiaries. EDEKA-Group is also using the SAP® ERP application and the SAP NetWeaver® technology platform to harmonize its merchandise planning and control systems. In the future, the group’s major business areas, which comprise the wholesale and the retail business, will be managed by SAP solutions.

Flexible IT Architecture
Over the past few months, the IT experts at EDEKA and SAP worked together to complete a current-state processes analysis. The team examined enterprise resource planning processes for wholesale and retail, master data management and the cross-company reporting system and provided the basis for the implementation phase. Going forward, various business units will display their business processes in an “EDEKA business process pool,” based on a flexible enterprise service-oriented architecture. To achieve this, EDEKA will deploy the SAP NetWeaver technology platform as well as the analytical tools of SAP NetWeaver Business Intelligence (SAP NetWeaver BI), SAP NetWeaver Master Data Management (SAP NetWeaver MDM) and SAP NetWeaver Exchange Infrastructure (SAP NetWeaver XI) for integration- and interface management.

Celebrating its centenary this year, the EDEKA-Group, with a business turnover of over 37 billion Euros and a distribution network of 10,000 stores, is the unchallenged leader in the German groceries retail business. In 2006, the company’s market share was 26 percent accounting for 8 percentage points ahead of the second in the market. With 253,000 employees, more than in any other German company, EDEKA is also Germany’s top employer. The three distribution channels – supermarkets, self-service department stores and discount stores – provide sustainable and profitable growth. In the fiscal year 2006 the group generated an EBIT of over 1 billion Euros. By 2010, EDEKA is planning to open 1,200 new stores and increase its market share to 30 per cent on the German market.

About SAP for Retail
SAP for Retail is a solution portfolio that helps retailers understand their business, anticipate the needs of their business and inspire their customers, employees and shareholders by delivering results. The portfolio comprises an end-to-end set of retail solutions; merchandise management and planning; store operations (through the acquisition and integration of Triversity POS solutions); and base finance and HR solutions. SAP for Retail helps retailers of all sizes to create shopping experiences that their customers will want again and again, by providing the ability to make the right decisions quickly and profitably (Additional information at http://www.sap.com/retail/).

About SAP
SAP is the world’s leading provider of business software*. Today, more than 43,400 customers in more than 120 countries run SAP® applications—from distinct solutions addressing the needs of small businesses and midsize companies to suite offerings for global organizations. Powered by the SAP NetWeaver® technology platform to drive innovation and enable business change, SAP software helps enterprises of all sizes around the world improve customer relationships, enhance partner collaboration and create efficiencies across their supply chains and business operations. SAP solution portfolios support the unique business processes of more than 25 industries, including high tech, retail, financial services, healthcare and the public sector. With subsidiaries in more than 50 countries, the company is listed on several exchanges, including the Frankfurt stock exchange and NYSE under the symbol “SAP.” (Additional information at <http://www.sap.com>)

(*) SAP defines business software as comprising enterprise resource planning and related applications such as supply chain management, customer relationship management, product life-cycle management and supplier relationship management.

Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should” and “will” and similar expressions as they relate to SAP are intended to identify such forward-looking statements. SAP undertakes no obligation to publicly update or revise any forward-looking statements. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect SAP’s future financial results are discussed more fully in SAP’s filings with the U.S. Securities and Exchange Commission (“SEC”), including SAP’s most recent Annual Report on Form 20-F filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.

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