Big Data Can Mean Big Returns in Retail

Lindsey Nelson

Big data for retail means a chance to see why a sale didn’t occur. Is it product selection? Pricing? Store display? Ineffective promotional material?

Before, this information was hard to track, but with the advent of big data and in-memory computing, two products ideally suited to collecting and analyzing unstructured data types like that of retail, are poised to play a significant role in sales.

For example, web logs are not the typical financial data people relate with the term “big data”. This web information shows how consumers navigate through an internet storefront. The data can be combined with previous BI (Business Intelligence) apps and sales data, generating clear insight.

Retailers now have the opportunity to see website traffic for a particular product and compare it to the sales. Before, if a product wasn’t selling it would be removed from the line. Now, managers can readjust pricing; ensure there are enough colors and sizes, and any other aspects that take a look to a sale.

This analytical approach to customer decisions is not limited to the web; some retailers are now using technologies to analyze foot traffic throughout their physical stores. These maps, combined with sales data, make way for new applications focused on optimizing store layout and product placement.

Retail relies heavily on in-store and online purchases, but they are not successful without making sure their product is delivered on time. Predictive analysis applications using the first day’s delivery, past delivery data, and real-time traffic data, provide revised delivery schedules, allowing retail managers to take immediate corrective action.

This is incredibly advantageous for retail managers, preparing them to better meet customer expectations and maintain high operational efficiency.

This operational efficiency is essential when retailers always want to know what their customers need before they even know they need it.

For example, using big data retailers now can see, through data from store cards, cashed-in coupons, and purchase history, when a customer may need a refill on a product. This data gives retail marketers the upper hand, sending the low stocked customers promotional material – urging them to buy the refill.

As Mark Ledbetter put it in his recent article, “Go Big or Go Home: How Big Data Can Bring Big Sales”, “How retailers use it to change their business, how they take advantage of it to grow sales…is only limited by their imagination.”


About Lindsey Nelson

Lindsey Nelson currently supports Content and Enablement at SAP. Prior to her current role, she was responsible for Thought Leadership Content Strategy and Pull Marketing Strategy at SAP.

Analytics: The Most Important Business Process in Your Organization

Timo Elliott

It’s time to take analytics seriously!

That might sound strange – after all, analytics has been at the top of Gartner’s CIO technology priorities for decades.

But despite that, analytics is still too often treated as an afterthought, as something used to track the effectiveness of business processes, or as a set of tools for making pretty visualizations and telling “data stories.”

It’s time to change that perception. In an era of digital transformation, analytics is now the most important business process in our organizations – and it’s time for us to start treating it like one.

According to Gartner, today’s CIOs are responsible for building the “civilization infrastructures” that are not just going to reshape business, but also the way we live.

There are five domains that make up these digital platforms: IT systems, customer experiences, things, intelligence, and the ecosystem foundation. The domains are interconnected and independent and organizations will focus on the one or few with the most impact for them, but it’s clear that intelligence — i.e., data and analytics — is at the heart of the organizations of the future.

For the last few decades, we’ve typically thought of business intelligence as a byproduct of our operational processes. We manufacture products, ship them around the world, and sell them to customers. Each of these processes generates a lot of data, and we use that data both to keep track of operations and to create more optimized processes in the future.

This remains as true and important today as it’s ever been in the past. But organizations are increasingly realizing that digital transformation doesn’t just require new processes – it requires a new approach to creating and implementing business processes. They need to be more agile, more intelligent, and more responsive to change.


These new processes flip the traditional equation on its head. New processes are created on the fly by analytics.

The typical customer journey is a great example. Think about how you purchase products today. In the old days, it was a fairly linear process that companies could characterize as a “sales funnel.” But now it’s more like a “write your own adventure” book – where there are many different possible interaction paths, and at each point in the process, you as a customer get to choose the next chapter and the next point of interaction.

The job of modern marketers is to optimize the whole system of touch points to maximize the flow of satisfied customers. And to do that, they rely on analytics, to guide the customer at each point – “you may be interested in these other products” or “here’s a discount if you purchase now.”

In the new world, it’s no longer about having a “customer process,” it’s about creating thousands or millions of personalized “processes” on the fly, based on the needs of each individual.

Because these new processes are analytics-powered, they can be much more agile and responsive to change – indeed, with new machine learning approaches, they can even update themselves, automatically adjusting to consumer behavior.

And this doesn’t just apply to marketing. We see the growth of similar on-the-fly processes in every other area of modern business, from production and logistics to finance and human resources.

Effectively creating and managing these kinds of flexible, on-the-fly processes is the big new opportunity in digital business.

In the next post, I’ll give examples of how the latest analytics technologies are enabling more process-driven approaches to optimizing information use in modern organizations.

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Timo Elliott

About Timo Elliott

Timo Elliott is an Innovation Evangelist for SAP and a passionate advocate of analytics, business intelligence, and digital transformation. He was the eighth employee of BusinessObjects and for the last 25 years, he has worked closely with SAP customers around the world on new technology directions and their impact on real-world organizations. His articles appear regularly in publications such as Forbes, ZDNet, The Guardian, and Digitalist Magazine. He has worked in the UK, Hong Kong, New Zealand, and Silicon Valley, and currently lives in Paris, France. He has a degree in Econometrics and a patent in mobile analytics. 

Marketing Meets Blockchain: What’s A Fair Price For Customer Data?

Jacqueline Prause

For everything from insurance to supply chain management, blockchain technology promises to upend traditional business practices – sometimes in the most surprising ways.

Even the modern marketer will not be spared from the blockchain revolution. On a recent episode of Internet talk radio show Coffee Break with Game-Changers, presented by SAP, a panel of three leading industry experts discussed the potential for blockchain technology to disrupt marketing.

During the show, titled Blockchain Technology: Turning Marketing on its Head, host Bonnie D. Graham moderated an energized, technology-focused discussion that revolved around a central question: What if the customer charges the marketer for access to his or her data in the blockchain?

For marketers long in search of a unified customer profile – that Holy Grail of marketing that provides a holistic picture of the customer, as mined from reams of marketing data – this question is sure to give serious cause for thought. Panelist Jeremy Epstein, CEO at Never Stop Marketing, summarized what this means for the future of marketing: “In a blockchain world, marketers will have to earn customer permission in an entirely new way. Identity will be controlled by the users.”

New challenges ahead in quest for unified customer profile

For those not familiar with the concept, blockchain technology is the infrastructure that forms the underpinning ledger of the Bitcoin crypto-currency, a technological marvel unto itself that is currently more highly valued than an ounce of gold. The decentralized network of computers and protocols that form a blockchain provide increased privacy and security for all data that resides therein. The encrypted nature of the blockchain puts the control over access to personal data squarely in the hands of the individual user.

“In a blockchain world, you’re going to have a shared data layer worldwide where the information is put into a blockchain and kept there,” Epstein explained. “But the control of that information will reside with each of us. For example, I as a customer will grant or revoke access to my personal information to a given company on a need-to-know basis.”

This is a vastly different approach from the current marketing process model of capturing customer data, storing it in databases, mining it, and possibly selling it to a third party. “It really is the inversion of the user model,” said Joel Monegro, investment analyst at Union Square Ventures. “If you think about how the web works today, you have to go to a whole bunch of different services to get different pieces of information: You have to go to Google to get your notifications or to get information of things that you are looking for; you have to go to Facebook to get information about your friends; and you have to go to Amazon to get information about products to buy.

“Instead, what is happening with blockchains is that we’re developing an architecture where services come to the user for their information. It’s creating this comprehensive view of the user that is user-centric and user-controlled.”

How much is my data worth to you?

“The user will have a blockchain-based identity,” explained Amanda Gutterman, chief marketing officer, ConsenSys. “You will control all of the different reputational and data attributes connected to that identity. You can selectively share or not share, or sell.”

In this new marketing environment, a brand may approach the customer with an offer to receive its weekly sales newsletter, as is often the case today when you make a purchase with a new vendor online. What will be new is that the customer can respond with the price that she will charge for reading that newsletter. Per the example given in the show, that customer might say, “Okay, for me to even look at your email there’s going to be a micropayment of .003 cents.” The brand could decide if it is willing to pay that or not, based on how much it values that customer’s interaction, and then initiate a transaction for payment in the form of a crypto-currency, like the Bitcoin. Assigning value to customer interaction is common practice in marketing today, however the customer is typically not paid for this interaction.

“What blockchain is going to enable, with the ability to create very sophisticated micropayment structures and governance structures, is kind of a sliding scale of media. So at any moment you’re either paying to consume media or being paid to consume media, based on whose interests are at play,” said Gutterman.

The brand will be able to assess on a case-by-case basis if it should continue paying that customer. In turn, the customer will be able to decide to raise her rates, perhaps because she is getting inundated with marketing information from other brands competing for his attention.

“It’ll be a negotiation for your attention and for your information, which are all assets that [marketers] want. If these weren’t assets, they wouldn’t be trying to capture and mine it,” concluded Epstein. At the very least, it means that marketers will be challenged to engage with customers in new ways – and will need to continuously prove the value of the relationship to their customer.

Listen to a recording of the full show here: Blockchain Technology: Turning Marketing on its Head


About Jacqueline Prause

Jacqueline Prause is the Senior Managing Editor of Media Channels at SAP. She writes, edits, and coordinates journalistic content for, SAP's global online news magazine for customers, partners, and business influencers .

How Emotionally Aware Computing Can Bring Happiness to Your Organization

Christopher Koch

Do you feel me?

Just as once-novel voice recognition technology is now a ubiquitous part of human–machine relationships, so too could mood recognition technology (aka “affective computing”) soon pervade digital interactions.

Through the application of machine learning, Big Data inputs, image recognition, sensors, and in some cases robotics, artificially intelligent systems hunt for affective clues: widened eyes, quickened speech, and crossed arms, as well as heart rate or skin changes.

Emotions are big business

The global affective computing market is estimated to grow from just over US$9.3 billion a year in 2015 to more than $42.5 billion by 2020.

Source: “Affective Computing Market 2015 – Technology, Software, Hardware, Vertical, & Regional Forecasts to 2020 for the $42 Billion Industry” (Research and Markets, 2015)

Customer experience is the sweet spot

Forrester found that emotion was the number-one factor in determining customer loyalty in 17 out of the 18 industries it surveyed – far more important than the ease or effectiveness of customers’ interactions with a company.

Source: “You Can’t Afford to Overlook Your Customers’ Emotional Experience” (Forrester, 2015)

Humana gets an emotional clue

Source: “Artificial Intelligence Helps Humana Avoid Call Center Meltdowns” (The Wall Street Journal, October 27, 2016)

Insurer Humana uses artificial intelligence software that can detect conversational cues to guide call-center workers through difficult customer calls. The system recognizes that a steady rise in the pitch of a customer’s voice or instances of agent and customer talking over one another are causes for concern.

The system has led to hard results: Humana says it has seen an 28% improvement in customer satisfaction, a 63% improvement in agent engagement, and a 6% improvement in first-contact resolution.

Spread happiness across the organization

Source: “Happiness and Productivity” (University of Warwick, February 10, 2014)

Employers could monitor employee moods to make organizational adjustments that increase productivity, effectiveness, and satisfaction. Happy employees are around 12% more productive.

Walking on emotional eggshells

Whether customers and employees will be comfortable having their emotions logged and broadcast by companies is an open question. Customers may find some uses of affective computing creepy or, worse, predatory. Be sure to get their permission.

Other limiting factors

The availability of the data required to infer a person’s emotional state is still limited. Further, it can be difficult to capture all the physical cues that may be relevant to an interaction, such as facial expression, tone of voice, or posture.

Get a head start

Discover the data

Companies should determine what inferences about mental states they want the system to make and how accurately those inferences can be made using the inputs available.

Work with IT

Involve IT and engineering groups to figure out the challenges of integrating with existing systems for collecting, assimilating, and analyzing large volumes of emotional data.

Consider the complexity

Some emotions may be more difficult to discern or respond to. Context is also key. An emotionally aware machine would need to respond differently to frustration in a user in an educational setting than to frustration in a user in a vehicle.



download arrowTo learn more about how affective computing can help your organization, read the feature story Empathy: The Killer App for Artificial Intelligence.


About Christopher Koch

Christopher Koch is the Editorial Director of the SAP Center for Business Insight. He is an experienced publishing professional, researcher, editor, and writer in business, technology, and B2B marketing. Share your thoughts with Chris on Twitter @Ckochster.


What Will The Internet Of Things Look Like In 2027? 7 Predictions

Tom Raftery

Recently I was asked: Where do you see the Internet of Things in 10 years?

It is an interesting question to ponder. To frame it properly, it helps to think back to what the world was like 10 years ago and how far we have come since then.
iPhone launch 2007

Ten years ago, in 2007 Apple launched the iPhone. This was the first real smartphone, and it changed completely how we interact with information.

And if you think back to that first iPhone—with its 2.5G connectivity, lack of front-facing camera, and 3.5-inch diagonal 163ppi screen—and compare it to today’s iPhones, that is the level of change we are talking about in 10 years.

In 2027 the term Internet of Things will be redundant. Just as we no longer say Internet-connected smartphone or interactive website because the connectedness and interactivity are now a given, in 10 years all the things will be connected and the term Internet of Things will be superfluous.

While the term may become meaningless, however, that is only because the technologies will be pervasive—and that will change everything.

With significant progress in low-cost connectivity, sensors, cloud-based services, and analytics, in 10 years we will see the following trends and developments:

  • Connected agriculture will move to vertical and in-vitro food production. This will enable higher yields from crops, lower inputs required to produce them, including a significantly reduced land footprint, and the return of unused farmland to increase biodiversity and carbon sequestration in forests
  • Connected transportation will enable tremendous efficiencies and safety improvements as we transition to predictive maintenance of transportation fleets, vehicles become autonomous and vehicle-to-vehicle communication protocols become the norm, and insurance premiums start to favor autonomous driving modes (Tesla cars have 40% fewer crashes when in autopilot mode, according to the NHTSA)
  • Connected healthcare will move from reactive to predictive, with sensors alerting patients and providers of irregularities before significant incidents occur, and the ability to schedule and 3D-print “spare parts”
  • Connected manufacturing will transition to manufacturing as a service, with distributed manufacturing (3D printing) enabling mass customization, with batch sizes of one very much the norm
  • Connected energy, with the sources of demand able to “listen” to supply signals from generators, will move to a system in which demand more closely matches supply (with cheaper storage, low carbon generation, and end-to-end connectivity). This will stabilise the the grid and eliminate the fluctuations introduced by increasing the percentage of variable generators (such as solar and wind) in the system, thereby reducing electricity generation’s carbon footprint
  • Human-computer interfaces will migrate from today’s text- and touch-based systems toward augmented and mixed reality (AR and MR) systems, with voice- and gesture-enabled UIs
  • Finally, we will see the rise of vast business networks. These networks will act like automated B2B marketplaces, facilitating information-sharing among partners, empowering workers with greater contextual knowledge, and augmenting business processes with enhanced information

IoT advancements will also improve and enhance many other areas of our lives and businesses—logistics with complete tracking and traceability all the way through the supply chain is another example of many.

We are only starting our IoT journey. The dramatic advances we’ve seen since the introduction of the smartphone—such as Apple’s open-sourced ResearchKit being used to monitor the health of pregnant women—foretell innovations and advancements that we can only start to imagine. The increasing pace of innovation, falling component prices, and powerful networking capabilities reinforce this bright future, even if we no longer use the term Internet of Things.

For a shorter-term view of the IoT, see 20 Technology Predictions To Keep Your Eye On In 2017.

Photo: Garry Knight on Flickr

Originally posted on my blog


About Tom Raftery

Tom Raftery is VP and Global Internet of Things Evangelist for SAP. Previously Tom worked as an independent analyst focussing on the Internet of Things, Energy and CleanTech. Tom has a very strong background in social media, is the former co-founder of a software firm and is co-founder and director of hyper energy-efficient data center Cork Internet eXchange. More recently, Tom worked as an Industry Analyst for RedMonk, leading their GreenMonk practice for 7 years.