Posted by Ajay Kelkar on Thu, May 13, 2010
Wal-Mart, a retail giant, handles more than 1m customer transactions every hour, feeding databases estimated at more than 2.5 petabytes-the equivalent of 167 times the books in America's Library of Congress.
Only 5% of the information that is created is "structured", meaning it comes in a standard format of words or numbers that can be read by computers. The rest are things like photos and phone calls which are less easily retrievable and usable. But this is changing as content on the web is increasingly "tagged", and facial-recognition and voice-recognition software can identify people and words in digital files.
Seth Godin put it simply in a recent post: Too much data leads to not enough belief.
Luckily in emerging markets the challenges are somewhat different:
1. Yes data is growing rapidly. But a lot of businesses have not focussed on how they can convert data into information and then into knowledge.
2. Huge opportunity exists to just create a simple "customer one view" and collate information at a customer level. A retailer could look at how an individual customer is shopping, what SKU's does she buy and when does she shop. And then put it together with payment data -did she pay by debit /credit card or by cash.
3. Retailers can then look at how simple data analysis can help build business. Some years ago as a Retailer, I had the opportunity of executing simple campaign experiments on loyalty program data. We sent a simple letter, from the store manager, to customers who had not shopped with the store for more than 6 months and who lived within a 5 km radius of the store. The campaign did wonders and got back many customers to stores across India. As a marketer you can start small and then improve business impact by using more analytics!
Here is an interesting article on how data volumes are ramping up for businesses worldwide
http://www.economist.com/specialreports/displayStory.cfm?story_id=15557443
Posted by Ajay Kelkar on Mon, Feb 01, 2010
I have always believed that banks can do much more with the consumer data that they have without sacrificing any consumer privacy guidelines. Imagine the power of Debit & Credit card retail spends information.
Here is an interesting initiative from Citibank called Bundle. It showcases proprietary data, sourced from Citibank's massive card-spending warehouse.
The site is based completely on spend data, showing household spending personalized to your specific location. There's also professional personal finance advice mixed with stories and comment from the community. Even the articles use the database to illustrate points.
Imagine the power of Analytics in driving this business model forward. In India it would be interesting to see a bank use its large Debit card base to build an application like this.
Have a look at this application at:
http://www.bundle.com/
Jim Bruene at Netbanker has some very good analysis on this(in his words):
If they want to attract data junkies like myself, the data needs to be more transparent and they need more robust tools to play with it. I enjoyed being able to compare the spending of my Seattle neighbors against that of my home town in Iowa (it's surprisingly similar). But I was left with a number of questions:
* Where does the spending data come from? The FAQs are vague on saying that it comes from Citibank card data, government sources and "other third parties."
* If its primarily Citibank card data, is it really representative of the entire town or just the people that hold Citibank cards? For example, Bundle tells me (screenshot #3), that the average dining out expense in Seattle is $115 and the most common spot is Starbucks followed by McDonalds. Something seems wrong with that.
* And furthermore, are these estimates of all spending or just that on Citibank cards? And which Citi portfolios are included? What about business cards?
Check out Jim’s comments at
http://www.netbanker.com/topics.htm
Posted by Ajay Kelkar on Sat, Jan 16, 2010
IBM did a study across CIO’s of over 2500 CIOs in 78 countries
and across 19 industries. The objective
was to understand how can today’s CIO make the biggest impact on behalf of the
entire organisation? Largely CIO’s spoke about what they are doing to achieve
three primary goals: to make innovation real, raise the ROI of IT and expand
business impact.
The findings really struck me, as the key message pointed
to exactly the type of problems we at Cequity, help organizations tackle every
day.
A few important points from the survey(as quoted from the
findings):
- When asked to
identify their visionary plans for enhancing their enterprises’
competitiveness, business intelligence and analytics was the top answer,
selected by 83 percent of our sample. A Media and Entertainment CIO in
Belgium told us better business intelligence will “bring marketing
analysis to a higher level, to improve buying behaviour and increase
advertising ROI. Many others agreed that they seek information-led
innovation based on information as an asset. “Facts drive decisions,” said
an Insurance CIO. “Plans for imbedded analytics need to enable data
capture at the customer touch point.”
- CIOs have
typically made data collection a top priority. Yet even when data exists,
no CIO can take its availability for granted. Just 67 percent of High-growth
CIOs said data is readily available for relevant users, versus 51 percent
of Low-growth CIOs. “The benefits of making information available are
beyond comprehension,” an Education CIO in Saudi Arabia told us. Many CIOs
admitted that their users can’t always access the information they need in
a timely manner. A Government CIO in the United States noted:“Data is
readily available to users, but it’s tough to find if you’re a novice”.
- Some of the key
findings of the India PoV of the CIO study 2009 are: 70 per cent of Indian
CIOs are integrating business and technology to promote innovation for the
entire organisation as compared to 47 per cent of global CIOs; and 64 per
cent Indian CIOs proactively push IT as an innovation element compared to
55 per cent of global CIOs.
- One key area
where global CIOs rank ahead of Indian CIOs is around proactively crafting data into actionable information.
However, this is also an area which both global and Indian CIOs have
ranked as number one for their visionary plans for future.
Some thoughts basis this:
1.
Analytics is often spoken about as a strategic
area. But what are the elements required to really embed analytics into the corporate
strategy. I think you need the following:
a)
huge
mindset towards data based decisioning from top-typically CEO
b)
Aggressive CFO questioning marketing spends
c)
Strategic CTO/CIO who creates the enabling environment
d)
Most
importantly you need a passionate evangelizer-in either marketing, finance or
customer operations. Typically a senior person in these functions who
passionately believes in data led decision making
e) Data is there but is awfully difficult to put
together for analytics. Smart companies are able to create “Data capability” by
bringing disparate data streams together –first manually and eventually into a
datawarehouse
Posted by Ajay Kelkar on Sun, Jul 26, 2009
Companies around the world
are literally drowning in data. A typical airline or retailer, for example, is
collecting data from many operational systems and storing terabytes, if not
petabytes, of data. But how closely do CMO’s and CIO’s actually work or are
they often at cross purposes! In India and I am sure in other furiously growing
markets as well, IT is so busy building the basic infrastructure to manage the
business that they often ignore the strategic priorities that Marketing is
trying to drive!
Paul
Barsch writes about how the chasm between Marketing & IT can be bridged in
this interesting article “Preparing for the Future: How the CIO and CMO Must
Collaborate to Win”
Paul
has some very interesting view points that you can have a look at http://paulbarsch.wordpress.com/
He has
this interesting take
“However, two powerful exponential trends (growth rates of data and
technology), will dramatically affect enterprise operations, forcing the
marketing and IT functions to communicate and collaborate like never before.
Moore's Law, conceptualized by Intel pioneer Gordon Moore, states that
the number of transistors per microprocessor will double every two years. This exponential
increase in processing speeds for various machines/devices will eventually
enable advances in economics, biology, technology, business, and other key
fields.
The second powerful exponential trend is the increasing amount of data
that companies must contend with on a daily basis. According to a Forrester
Research report titled "Data, Data Everywhere,"
the "volume of the world's data doubles approximately every three years"!
And for most companies data isn't conveniently stored in one central
location—it is often found on spreadsheets, data marts, and storage devices
strewn across the enterprise. In fact, in many organizations, marketers are a
key culprit in the creation and upkeep of separate "pocket databases"
containing customer lists and purchase histories.
And while capturing and storing relevant data is a challenge, an
additional obstacle is analyzing and translating this data into actionable
information to improve the customer experience or drive operational efficiencies.”
Paul makes this interesting comment: “Marketers need fresh and
accurate data for advanced marketing functions such as better segmentation,
more effective campaigns and offers, and relevant interactions with the
customer across multiple touchpoints. And CIOs realize that the benefits of
creating a single source of relevant and accurate data for business analytics
go far beyond helping marketers get closer to customers—and in fact benefit all
aspects of company operations. Both the CIO and CMO have a stake in the
development and implementation of an analytical infrastructure capable of
turning data into actionable information that in turn enables better
decision-making not just in marketing but across the enterprise.”
Our take at Cequity
1.
Are
you creating forums by which the IT department can better understand your
marketing agenda?
2.
Is
the CMO championing areas where there is an overlap with the CIO/CTO- eg Data
quality, Service oriented architecture etc?
Posted by Ajay Kelkar on Sun, Jun 28, 2009
Companies collect so much data today and yet when you go looking for it you will often find barriers! So what’s wrong…If we were honest with ourselves, as professionals, we would admit what Rosabeth Moss Kanter suggested in 1979 in a famous Harvard Business Review article: that “Power is Americas last dirty word. It is easier to talk about money -- and much easier to talk about sex -- than it is to talk about power. People who have it deny it; people who want to it do not want to appear to hunger for it; and people who engage in its machinations do so secretly”.
Data is power and so within every business, people hoard data. Functional managers fight with each other to “not allow access”. What this does is create huge asymmetry in the information that a company has about its customers. This gets further aggravated by the fact that no one business function is tasked with “getting all this data together and creating insight for the enterprise”. Many companies have tried to attack this problem by building Datawarehouses! But this path is expensive and often fraught with danger of failure –again due to data politics.
Marc Demarest has this interesting take on why Datawarehouses fail :
http://www.noumenal.com/marc/dwpoly.html
How do you attack this problem? In my view the following go a long way in discouraging creation of data silos in any organization:
1. CEO commitment to decision making with facts. Not just lip service but truly compelling demands from the CEO to show evidence before making any important decision.
2. A change agent combination-the best one is if the CIO & CMO play the tango! Both recognize the power of actionable information for the company and work to make the “Data to insight to action” transformation happen!
3. Realistic CMO who does not wait for all data to be accessible. Instead she/he launches a series of incremental data based marketing initiatives that propel an interest in the impact that customer data could make in the overall marketing efforts.
Akin Arikin has this lovely post on how you can create competitive advantage for your company by using analytics more cleverly than your competitors and what data is required to help you do that. Check out more at
http://www.multichannelmetrics.com/competing-of-data-for-competing-on-analytics/