Future Group: Big Data Takes Centre Stage

By Sohini Sen , afaqs!, Mumbai | In Marketing | November 03, 2014
Kishore Biyani's Future Group also announced a JV with customer science company, Dunnhumby.

Kishore Biyani's Future Group has entered into a joint venture partnership with customer science company, Dunnhumby, which will leverage the extensive consumer data from the retail network of Future Group to segment and engage with its customers more effectively.

Future Group


Dunnhumby hopes to use this data to uncover valuable insights on what customers want, where they want it, and how much are they willing to pay for it. Dunnhumby operates similar joint venture partnerships with retailers worldwide, including Kroger Co (US), Metro (Canada), Gruppo Pam (Italy) and Coop (Norway).

There was an interesting development on the sidelines of the announcement. A panel of esteemed guests discussed the topic: 'Big Data, Advance Analytics, the Next Big Thing'. Moderated by Ireena Vittal, independent advisor and a former consultant with McKinsey, the panel spoke about how big data can be used to further the business objectives of brands and retailers. The panel included Simon Hay, CEO, Dunnhumby; Rakshit Hargave, MD, Nivea India; Issam Bachaalani, MD, Colgate Palmolive India; Yogesh Bellani, CEO, FieldFresh (a JV between Bharti Enterprise and Del Monte Pacific); D Shivakumar, CEO, PepsiCo India and Kishore Biyani, Group CEO, Future Group.

Hargave was of the opinion that at the rate at which data is evolving made the market very exciting. He used examples from his brand, Nivea, to explain that the company needs to understand customers' intuition. What Nivea tried to do was customize data for individuals. Hargave also believes that too much data is not 'actionable' - Nivea tries to only keep that data which can lead to some action.

Secondly, with numerous sources of consumer data, sometimes the connectivity between data points goes missing. In such a scenario, he fears, people end up taking recourse to the classic brick and mortar model. The challenge of social data, according to Hargave, is to understand how much actually make sense. The brand needs to interpret consumer data in a more meaningful manner. "What I would want is to marry the benefits of one-to-one marketing, or precision marketing, at the cost of mass marketing. nd how do you link retail and consumer data at a cost which is reasonable?" asked Hargave.

PepsiCo's Shivakumar felt that data is doubling at a very rapid pace. For Shivakumar, India is one of the best markets to build big data. Big data, he said, works extremely well in a format where somebody aggregates brands and facts, and somebody aggregates consumers - which is why Big Bazaar could well be the pioneer of such big data collection. At the same time, he agreed that retail has traditionally been spoken about with single digit margins. But research has shown that, if done properly and in an organized way, retail margins can grow to double digits. "Traditionally, retail has worked on price, place, product and time period. However, we now look at the kind of data that is coming, and the velocity, variety and value of data. We need to marry these two to get the best benefit," explained Shivakumar.

Shivakumar was of the opinion that the role of videos in data collection will grow, as will the importance of the consumer's ability to show his location for data collection. He felt that the adversarial relation between brand owners and retailers, that exists today, can't help in the growth of either. Therefore, he suggests a joint management of data with new data scientists who can make sense of and track the digital world.

Dunnhumby's Hay explained how the company used big data in experiences world over. But he expressed amazement at the quick growth of data - what is big data today, may be overshadowed by a bigger data tomorrow. He does not agree with a chunk of the online world, which thinks that it starts and stops with the 'search for data'. According to Hay, the analysis of mobile data, social data, research data or loyalty data helps the brand to move forward.

Biyani wanted to know how big data can help them to do business. Future Group's 2020 vision is to make 10 billion people shop for Rs 100,000 every year. Along with that, he felt that big data also tells a brand what to do next as well as what not to do. Biyani continued that big data helps the brand to do targeted marketing, pick up trends and respond much faster. "The way we do business is probably going to change with big data. It will let us look at market assortment in an organised manner," Biyani said.

Colgate Palmolive's Bachaalani warned people against the bombardment of data from everywhere. He suggested keeping it simple. According to him, knowing what to look for is the best strategy to deal with big data. At the same time, he agreed with Hargave in looking for actionable data.

Bellani picked up an interesting point when he spoke about how big data can be used by start-ups. He felt that business is not about right or wrong, black or white. The question is to make better optimal use of minimal resources, especially for a start-up. Bellani also asked if one could use big data in an integrated value-chain or platform. "The truth is that the customer today wants to be treated as unique. Today's modern trade system provides the data to equip us for that," Bellani explained.

The panel agreed that big data is about being able to take smarter decisions for the brand, and also to understand whom to target, how to target and how to make them buy the products on offer. There is a lot of junk data, and if the credible data is sieved through that, only then will brands be able to take smarter decision quicker and cheaper.

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