The consumer packaged goods (CPG) and retail industry faces major challenges globally with an uncertain economy, digital competition, and a new generation of customers who are highly demanding and informed. Today’s disruptive innovations have opened up avenues for CPG and retail companies to improve market share and margins. Analytics Insights spoke to Anthony Kilili, Head of dunnhumby India to understand how insights related to sales, inventory and customers are extremely crucial and how the company offers solutions which help retailers and CPG companies drive significant decision-making.
Analytics Insight: Kindly brief us about the company, its specialization and the services that your company offers?
Anthony: dunnhumby is the global leader in Customer Data Science, empowering businesses everywhere to compete and thrive in the modern data-driven economy. We always put the Customer First. Our mission: to enable businesses to grow and reimagine themselves by becoming advocates and champions for their Customers. With deep heritage and expertise in retail – one of the world’s most competitive markets, with a deluge of multi-dimensional data – dunnhumby today enables businesses all over the world, across industries, to be Customer First.
The existence of a Media Business alongside our Retail Analytics tools & consulting makes our offering and competitive positioning rather special: we have a unique product and service portfolio for retailers and CPGs.
In order to fully harness the benefits of customer analytics, a clear and comprehensive customer focused strategy is required supported by appropriate team structure. The first step in this process is to ensure data management and utilisation is optimised in secure fashion.
dunnhumby can support both the development of customer data management and optimisation all the way through to execution of customer and media strategy. We can both enhance and execute a retailer’s customer-focused strategy, whilst developing collaborative relationships with CPGs.
dunnhumby can effectively, and quantitatively elevate & demonstrate marketing effectiveness, whether it be a new product launch, or a branded media campaign online or instore.
Analytics Insight: What is your biggest USP that diﬀerentiates the company from competitors?
Anthony: dunnhumby has more than 30 years’ experience in customer data science, with presence in 27 countries, analysing insights from more than 800 million shoppers globally and delivering almost 5 billion personalised shopping offers. It uses customer data science to deliver exceptional customer experiences in-store, offline, and online.
dunnhumby has arguably the best science in the world. When we apply our IP to transactional data, we can build a powerful picture of what people are actually purchasing and work with retailers and suppliers to make good business decisions that put the customer first.
Grocery is our primary specialisation. Our first priority when working with a retailer is to look at what products they sell, and what store they should sell them in. Our next step is to organise the approach to promotions
We look at
• Who are your customers
• Why they come to store
• What they buy and when
We create revenue for retailers by offering services to manufacturers as data is valuable insight.
Analytics Insight: Please brief us about the products and services you provide to your customers and how do they get value out of it.
Anthony: dunnhumby partners with both retailers as well as manufacturers. The retailer engagement model works either as a long-term joint venture or as a small to medium term contract. We work with retailers like Tesco, COOP, Homeplus etc.
Our engagement with manufacturers works either as small to medium term contract for SHOP and/or through custom insight solutions that dunnhumby offers to its manufacturer partners across a broad spectrum. We also work closely with CPGs like Pepsi, Coke, P&G, Unilever, Cadbury, Nestle etc.
dunnhumby always puts the customer first. We work with retailers and CPGs to build long-term loyalty and drive incremental sales by delivering the most relevant and personalised experience for Customers.
We build foundations of:
• Customer Insights
We use our science to help you see, engage and serve your customers in a more effective way that brings commercial benefit to your business. Our Customer Centricity Study shows that customer – led businesses outperform their competition with the top 25% achieve +3% growth in L4L sales and 7% growth in market share
This underpinning of prescriptive analytics and machine-learning forecasting means we have learned how to uncover and unlock opportunities to find wasted investments in Customers, to conserve and optimize only those investments that work to grow loyalty and sales, and to commercialise your data assets.
And the areas where we can help?
Analytics Insight: What’s your growth plans for the next 12 months?
Anthony: In the last 12 months we grew our client base by 25% which we will continue to nurture. We have significant growth plans as we explore new industries and geographies as well as deepen our work with Retail where there is still incremental opportunity. For example, we have recently launched in Australia and New Zealand where we hope to build into one of our top 5 markets globally in the next 3-5 years.
We have also launched a new media business where our operating model (OM) combines media, science and partnership capabilities to build connected media plans. These bring together offline and online customer experiences, resulting in seamless, personalised campaigns with measurable and actionable results that businesses will be able to benefit from.
Analytics Insight: What is the size of analytics team at dunnhumby?
Anthony: 25% of our workforce are data scientists and analysts.
Analytics Insight: How does your company’s strategy facilitate the transformation of an enterprise?
Anthony: Strategically we have evolved our offering to be able to work with retailers in many ways to ensure that we can be flexible in our offer. Some just need software if they have their own talent pool and established team and some need a whole dedicated dh team to work for the retailer specifically. This means we are flexible in how we work and who we can work with.
We bring our long-standing knowledge from 30 years of experience and our world leading science to businesses but applying the theory of putting the customer at the heart of every decision, which ultimately transforms results for the business.
Many companies have a huge amount of data these days. But knowing what to do with it, having the science to apply to it along with the knowledge to create insights and capability to action is rare. That is the value dunnhumby can bring.
Few case studies
• Kroger achieved 53 quarters of L4L growth even throughout the recession when all other grocery retailers declined.
• Our Customer Centricity Study shows that customer – led businesses outperform their competition with the top 25% achieve +3% growth in L4L sales and 7% growth in market share.
• Shoprite achieved margin and revenue growth of +1.5% by partnering with dunnhumby including +19% profit from analysis of core product assortment and 2-8% category sales uplifts.
• Coop Norge achieved +24% sales and shelf improvements in 13 weeks and +8% more baskets – +61% customers buying front page items and+1% L4L growth with new promo flyers.
Analytics Insight: What is the reason that organisations are using analytics/big data/AI/ML/Big Data Analytics?
Anthony: Big data analytics have taken a predominant spot in the corporate world as numerous case studies arise on how businesses have been positively transformed through data-driven decisioning. Big data analytics enable companies to make more informed decisions, a crucial point in competitive differentiation. Application of analytics provides gains in terms of cost reduction (e.g. by using predictive models to optimize marketing budgets), faster time to action (e.g. by using real-time data streaming analytics for online product recommendations) and innovation (e.g. by understanding customer needs and personalizing offerings to meet those needs). To remain relevant, organizations across all economic sectors will need to mine through the vast amounts of available data to find actionable insights needed in an era where customer demands are rapidly changing and the competition is continuously innovating.
Analytics Insight: How are disruptive technologies like Big Data analytics/AI/Machine Learning/Cloud Computing impacting today’s innovation?
Anthony: These technologies facilitate the utilization of vast amounts of structured and unstructured data to drive innovation. They provide cheaper data storage, faster processing and access to AI algorithms at the heart of today’s topmost technological advancements. For instance, many companies are moving to cloud computing where they enjoy significant cost-savings and easy to implement AI solutions. The ability to quickly process data and provide real time solutions through these technologies have led to the rise of many new business models and innovations. Today, we have the robotic shopping assistants, the delivery drones, the robot-operated fulfilment centres and many others, thanks to these technologies.
Analytics Insight: What have been the most significant challenges that you have faced at the forefront of analytics?
Anthony: One of the big challenges is a shortage of talent. The demand for data science professionals continues to increase as more organizations switch to big data strategies. Successful data scientists are proficient in Advanced Analytics methods such as Machine Learning, they are savvy programmers and can quickly understand the business context. This combination of skills is not easily found at scale. This can be mitigated by working with specialized third-party data science partners.
Secondly, despite the rapid advancements in data processing and storage technologies, there are still vast amounts of data which are not being utilized to extract value. This is called ”dark data” and is the biggest portion of all data collected by businesses today. This data left unexplored is lost opportunity for businesses.
Analytics Insight: What are business benefits of handling data analytics & implementing a real time decisioning platform?
Anthony: Big Data technologies provide the methods and tools needed to rapidly collect, process and analyze large amounts of data, providing a comprehensive 360-degree view of the individual. In real time solutions, the data is consumed at the speed at which it is generated and is used to provide real time actions. A simple example would be a retailer pushing a notification to customers passing by their store with personalized incentives to enter and shop. Or an ecommerce retailer providing a recommendation for a product that combines well with one already in the customer’s shopping cart. These types of solutions, often driven by advanced machine learning algorithms drive measurable incremental value and provide competitive edge to businesses. Latency in such processes can be costly in terms of missed opportunities to make recommendations at the most relevant touchpoint and at the right time.
Analytics Insight: Can you throw light on the latest employment trends in big data and analytics industry?
Anthony: Advancements in the Big data analytical industry have led to a strong demand for skilled talent. As more and more businesses embrace data-driven decisioning, this demand is bound to increase coupled with the emergence of new career paths. Some of the hottest jobs today did not exist just a few years ago, these include: Big Data Engineers, Data Scientists and Machine Learning Engineers. It is an exciting era for data science professionals due to the numerous opportunities available now and in the future.