Teradata, the solution provider for specialised data warehousing and business analysis, is optimistic about the prospectus of their business growth in India, considering the increasing usage of cutting edge technologies in various businesses. Teradata has vast experience of working with overseas retailers. Ed Dupee, vice president for global retailing, Teradata Corporation and Ashok Ekbote, country manager, Teradata India pvt ltd, India, jointly discuss the needs, benefits and scope of advanced technologies and their implementations in the sunrise sectors like retail, while answering Indiaretailing.com questions.
Q1) Why BI solutions are increasingly been looked upon as solutions that would leverage retailers for achieving higher profits, accelerate growth, and to have an edge in the competitive marketplace?
Ed Dupee: We believe that retailers with the greatest intelligence about their business will survive and thrive in both challenging and prosperous economic times. While the business questions may be different, considering the continuous changing economic environments, what doesn’t change is the fact that retailers need to have a detailed knowledge to better understand and manage their business. This has certainly proven to be the case in retail, because companies that have adopted business intelligence and data warehousing are among the world’s most successful retailers including Walmart, Metro, Home Depot, Carrefour, The Gap, Best Buy, HEB, Publix, and JCPenney just to name a few.
Business intelligence (BI) and data warehousing (DW) help retailers in several ways. I would like to mention a few key areas: BI-DW help retailers better understand their target customers, so to address their wants and needs. These tools also help retailers to understand supply and demand patterns in a better way, so that retailers could have quick response to out of stock or over-stock situations.
The solutions help retailers to comprehend to customers response to ‘promotions’ and ‘offers’ that deliver higher redemption and response. Moreover, with those solutions in place retailers would have clear understanding and will be able to manage their assortments so that they can localise for different markets and customer segments.
Q2) Can you please explain how the data warehousing concept and technology, is it going to help organisations? How is it relevant to today’s business environment?
ED: The markets for BI and data warehousing are tightly intertwined and extremely symbiotic. Even though technically you can do one without the other, but we rarely see that being the case with our customers; because our focus is data warehousing. We are a company that works with technology partners, providing business intelligence applications, which run on our data warehouse. A data warehouse provides a standardised, consistent, clean and integrated form of data, sourced from various operational systems, and is built as the foundation to support a company’s reporting and analytic requirements. Data warehouses are extremely relevant to today’s business environment. They are utilised by leading retailers and fast moving consumer goods segments as the foundation for their BI and analysis applications. A data warehouse provides a retailer the ability to leverage their data assets to gain strategic insight, recognise emerging trends, and respond quickly. In addition to providing ROI from a business perspective as told before integrated data warehouses are also cheaper to build, maintain, and operate than alternative approaches such as departmental data marts.
Q3) Tell us how investing in data warehousing and BI solution could be value for money? How is the return on investment (ROI) realisation?
ED: Data warehousing and BI solutions can be justified on both qualitative and quantitative basis. Relative to the qualitative basis, many leading retailers see data warehousing and BI as strategic investments that they must do, to be competitive and use that as the foundation for justification of investment. However, most retailers also require a traditional quantitative business case as well. And in today’s economic environment, we see almost all investments requiring a solid business case and ROI. Specific to the quantitative business case, we see data warehousing and BI delivering substantial ROI in various areas such as increased revenue, increased margins, reduced markdowns and shrink, and increased inventory turns.
Q4) How is the mood of market? Are companies willing to invest; especially retail and FMCG companies?
Ashok Ekbote: We believe the market for data warehousing and business intelligence in retail is very mature, with major retailers willing to invest in solutions. They have done it even in the face of current economy, because of the high ROI and transformational abilities that data warehousing and BI provide.
Q5) Is steady retail growth boosting enterprise technologies sales?
AE: I believe the influx of multi-nationals will drive huge growth and the use of data warehousing and BI in India. Major MNCs have been using leading technologies and solutions to run their business for decades. They will certainly use these for their business in India as well. Hence, the scale and complexity of a global supply chain leading to a retail store in India will necessitate the use of such technologies. Finally, domestic retailers in India will have to adopt BI to remain competitive with these MNCs.
Q6) How does ‘active enterprise intelligence’ — as Teradata calls it — help in doing brisk sales, making shopping experiences even better, and attaining greater customer satisfaction levels?
ED: “Active Enterprise Intelligence” extends the ability of data warehousing, which has traditionally been employed primarily by corporate employees for strategic intelligence and decision making, to front line workers such as store personnel for operational intelligence and decision making. A few customer examples — DSW, a retail shoe company — that makes loyalty information available to sales clerks through the point of sales system. Hudson Bay in Canada connects their return clerks to the data warehouse to combat fraud by ensuring each product is returned once, and only once. In the food service space, Applebee’s analyses price vs. performance for menu items using Teradata, constantly seeking to improve the slow or low-profit items. They also analyse service times to optimise restaurant through puts, all the way from the greeter to the cashier. Cabela’s, a leading outdoors-sporting and camping goods retailer, improved the performance of email campaigns by 98 per cent through smarter targeting. and using the power of our ‘parallel processing’ capabilities, can do selections in one hour or else will require several days. Haggen, a supermarket chain based in Seattle, uses active technology to detect ‘bad’ or fraudulent check writers, and makes that information quickly available to all the stores in the chain.