Monday, April 15, 2013
Targeting Business Customers vs. Consumers
Indix, a start up company that is now split on two continents, just recently got $4.5 billion in financing in order to work towards their goal of tools to give business managers based on big data. The company's CEO, Sanjay Parthasarathy, just recently moved from India back to Washington to expand the marketing, sales, and customer service center, leaving the research and development center in India. The small, 35 person, firm is doing big things however, despite it's size and new split between continents.
Indix is building a dataset with information on different products, their prices, and certain events that affect those prices. At this moment, they have over one billion prices and lots of products and are aiming for more. What do they want to do with all this data? The interesting thing about Indix is that they are focusing on the business customer side instead of the consumers. Why? Parthasarathy says that it's very interesting looking at the events along the supply chain that affect the prices of the product. He likes to think of what businesses will be capable of if the managers are equipped with the information that Indix is currently compiling and analyzing.
Their goal is to build a platform and a set of tools that will enable both internal and external collaboration within businesses. They want the managers to be able to use the information, analytics and visualizations, suggestions, and many other tools created by Indix to improve their business, mostly to set the most profitable price. What is interesting to me about this is that I haven't seen a lot about this before. Indix seems like a pretty unique company with a unique goal. I've seen a lot about Target and Netflix using the analysis of Big Data to determine what their customers want. But what about ways to improve their business model or supply chain?
This seems to be a place where IE's can truly come in and shine. Yes, what the consumers want from a store or company is very important and meaningful to us. However, we're trained to improve systems and businesses. This is what Indix is trying to do with their massive dataset. Maybe this is something that we should also be focusing more on as IE's as Big Data is becoming more popular.
Source:
http://www.xconomy.com/seattle/2013/04/15/a-billion-prices-and-counting-big-data-ambition-at-startup-indix/
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I find it very interesting that this company is aiming to improve price setting for businesses. Many sellers on Amazon try to do similar things using only their competitors prices, and sometimes to disastrous results. Situations like this could be easily avoided by simply using historical sales and pricing data instead of merely comparing to a competitors current price. Also if the price was set well in the first place, algorithmic price setting would not be necessary anyway, because the price would only need to be set once.
ReplyDeleteWhen it comes to product development, lots of companies seem to be using big data to gain better information about what the market wants. Netflix used data analytics to determine that they should produce their extremely popular original series House of Cards. Netflix found that people that like political drama also enjoy Kevin Spacey movies, and that many of their customers liked both.
Observation: I was impressed by the $4.5 billion investment money for a 35 people company. Wow! However, I went to the article source and I think the correct figure is $4.5 million, not billion.
ReplyDeleteOn the other hand, I liked the last comment on the article and I quote: "What would the product manager be capable of if we gave them the data, the tools and the applications that would help them come up with new product ideas, set the right prices, manage promotions and make their offerings available to their customers in the best ways possible?” I think this monstrosity of a data set (1 trillion entities) will be very appealing to big retailers like Walmart, Kroger, or Target; this data set will be perfect for applications like the one we saw on the "Target" article at the beginning of the class. This article showed how retailers are able to predict/forecast when their customers are going to have a drastic change in their lives that would challenge their current retail loyalties (like having a baby).
At the end of the day, all this "power" (I personally see information as power) is extremely dangerous in the hands of a few. It really scares me to see companies like Google and Walmart which have Profits that, if considered countries, could be in the top 30 - 50 GDPs in the world. Since Google owners already have so much money (each of them has a "customized" Boeing 727), would the company start living in gray areas and start considering the unethical use of data? Take a look at this article from the New York Times called "Google’s Search Goes Out to Sea" http://bits.blogs.nytimes.com/2008/09/07/googles-search-goes-out-to-sea/
Google filed a patent for a "water based data center" in 2008. In "lawless" international waters, could this become a paradise for the corrupt (unethical users of data)? - could we call them data pirates? Scary.
Big data can also be used to improve the customer experience. Sometimes, we do not want a big change and face all the new scenes in front, but there is no choice for us and no one can stop the development in our society, with the high speed development of business, the amount of data has increased at the individual customer level, and in past of years, most of organizations used cloud to analyze the data to find valuable information for building up the view of the customer. In addition, this kind of action improves the customer experience, and the organizations should notice that without the knowledge analyzing method to deal with the data, the customer data could be nothing. Relational Database Management Systems and the other kind of out of date data processing technologies can not perform well in the increasing amount of massive data, but almost all the organizations put the customers’ position in a really high level, if the organizations want to get more profits from the market, to choose Big Data as the analyzing method could be the wise decision. With the big revolution in data analyzing, Big Data could help the organizations which have the ability to take the right, suitable, and useful information from the massive data to analyze and improve their performance in business, especially, Big Data could help organizations to make a good decision and to make them have the competitive advantage, in another word, Big Data has the magic ability to maximize the value of the data. There is no doubt that it is time for Big Data to improve customer experience.
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