14 Jul Retailers Find Analytic Solutions
The New Zealand Sunday Star Times published a nice article about 11Ants Analytics yesterday.
The full article can be read here: Retailers find analytic solutions
Hamilton firm 11Ants Analytics is using big data to help international firms such as Tesco and Procter & Gamble understand their customers better.
Signing customers up to loyalty schemes is now a well established strategy for retailers wanting to know more about their shoppers. But after investing in these schemes, many businesses are not capable of analysing and processing the masses of information they gain as a result.
Hamilton company 11 Ants Analytics specialises in wrangling such information for retailers, and is one of a handful of Kiwi firms forging a business out of the growing global market for big data.
British grocery chain Tesco, consumer brands giant Procter & Gamble, as well as New Zealand firms 2degrees, Fisher & Paykel Healthcare and TradeMe have turned to the Waikato University spinout for help in analysing their consumer information.
“There’s been a push to personalise marketing material but if companies don’t understand very much about their customers, they don’t know how to personalise it,” 11 Ants Analytics CEO Tom Fuyala said.
“When a retailer sets up a loyalty programme, the sell for them is usually that they are going to understand their customer better and they pay pretty handsomely to get this information.
“The problem is that with 95 per cent of retailers all that happens is that the data just sits in a data warehouse and they don’t know what they can do with it.”
The company uses cutting edge machine learning technology developed at Waikato University’s computer science division, a branch of artificial intelligence in which computers learn from data without being explicitly programmed.
It has created several analytic tools designed to interpret and forecast customer behaviour. Data such as customer attrition rates and buying patterns can be tracked and predicted.
“It’s always interesting to me to look at the purchase history of a customer. It’s pretty meaningless to do it one person at a time, but if you are looking at millions of customer shopping baskets, massive patterns come out,” Fuyala said.
“We can create a fingerprint of a customer and from there you can find customers with a similar fingerprint that are significantly more likely to buy a certain product. If you target those customers you can make an offer which is far more significant to them instead of just spamming everybody.”
Founded five years ago, 11 Ants Analytics began doing contract work in a range of areas in different industries. But due to demand, the company decided to focus its business on customer analysis and loyalty programme data.
As the awareness of the uses of big data analysis grows, there is an increasing global skills shortage of marketers with an understanding of technology, Fuyala said. The software 11 Ants Analytics designs aims to bridge the gap for marketers who do not have an academic background in IT.
“What we are trying to do is make this sort of information much more accessible to a marketing manager, they don’t have to be intimidated by the technology,” he said.
Although there are some major players in the consumer analysis field, including IBM and many consultancy firms, Fuyala believes 11 Ants Analytics’ software is more user-friendly. Its cloud technology also means the programme is ready to use within hours and clients don’t have to make a large investments in hardware, he added.
The firm has no international sales force but has managed to win all of its overseas business through its online presence and word of mouth, he said.
“Big companies are usually looking for a solution to a particular problem and they look at what alternatives there are to solve that problem. They usually start a conversation with us and find what we do is very powerful and feasible,” Fuyala said.
Although it now has customers around the world, 11 Ant Analytics is focussing on the Australasian market while it refines its tools to more closely match the needs of clients.
“The challenge we’ve got on moving ahead in the US market is that you need to have some physical presence there. When you try to have follow-up meetings with people it becomes very expensive,” Fuyala said.
“At the moment it’s a question of where we can focus our resources to get the best return.”
The company is re-investing everything it makes into further expansion, but is reaching the point of critical mass. To grow further 11 Ants Analytics may need to do a capital raise, and Fuyala is currently considering a distribution deal with a global marketing solutions company.
“We’ve got some international companies interested in partnering with us which could fulfill the role of a sales force for us,” Fuyala said
“There’s some interest from some quite powerful companies. Those conversations are happening now, and [if that happened] that would be a very nice model for us.”
The article was written by Emma Rawson and appeared in the Sunday Star Times on July 13, 2014.