BSI: How We Did It - The Case of the Fragrant Sleeper Hit

HOW WE DID IT:

“The Case of the Fragrant Sleeper Hit”

© Teradata 2011< 2 >

We’re Getting A Lot of Questions …

Hi Everybody,

We’re the brains behind the scenes and wanted to answer your questions about “how” we did the Fragrant Sleeper Hit study.

This write-up will give you an idea of our clients’ architecture and some details of our investigation.

Take a look, and if you still have questions, shoot them to us! We’re both on Facebook.

Yours truly, Chi Tylana, Lead Investigator

Jodice Blinco, Director, BSI

Jodice and Chi go overthe final report for Great Brands


Scene 1: at Great Brands HQ – Jan (COO), Stella (Group Brand VP) and David (VP Mfg)

• Today’s meeting is a review with Jan of the Goldensoft re-launch. Last year Great Brands did so-so with the rollout of the lime, spice, and ginger fragrances. They are adding coconut and almond this year.

• Stella did some initial store tests but the point of sale data is somewhat inconclusive about demand.

• But she used this to provide some inputs to David, responsible for the Production Plan.

Goldensoft Skin Lotion Fragrance Options

Lime Spice (last year’s top)Ginger Almond (new)Coconut (new)


David’s Original Goldensoft Production Forecast

David shows Jan the production plan (next page), built from Great Brand’s SAP Advanced Planning and Optimization (APO) application, running on Teradata.

This is a ramp plan for the 4 months running up to Christmas for each fragrance. Units are in thousands of cases, each holding 64 Goldensoft items.

NOTE: Lime and Spice were expected to be the Top Predicted Sellers, based mostly on last year’s actuals coupled with Stella’s initial store tests of the new fragrances. But she didn’t get a lot of feedback, which is why David is nervous.

Last year they had some major shortfalls so David wants to make sure they do better this cycle, especially with the new COO ‘watching’.


David’s Original Goldensoft Production Plan


Stella’s Original Goldensoft Marketing Plan

• Stella used the Aprimo Marketing Studio to lay out the spending, by the 4 regions and nationally, on a variety of marketing elements, ranging from regional store flyers and events, plus national TV and web marketing efforts. (Next page)

• Although not shown in the episode, Aprimo also helps Stella track her spending across all the activities, including all collateral development and approvals with agencies, and compare plans to actuals.

• She picked Lime as the main fragrance to highlight in all her promos

• Unfortunately for her, Jan isn’t convinced she has a solid plan and asks her to call in BSI for some help


Stella Uses Aprimo Marketing Studio A Comprehensive Solution

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APRIMO VISION

Aprimo Platform

ChannelsAgencies

Customers

SEO/PPC Store/Branch ATM/Kiosk

Broadcast EmailEvents

Agent or Acct Manager

Print Social Media

Web

SmartphooneCall Center

Webinar

Direct Marketing

Media

Direct

Creative

Marcom Web Advertising Finance Events

The Marketing Value Chain

CMO


Stella’s Goldensoft Marketing Spend Plan


Stella Also Uses Aprimo Marketing Operations - WorkflowDesigning and Approving the Goldensoft Ad Copy/Visuals for Print and Promos

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Scene 2: Stella Meets with BSI

• Stella meets with BSI Investigators on contract - Chi, plus 2 new BSI hires Mercedes and Marco. This is their first case!

• They form a plan to go way beyond POS data to predict the right mix:> Can we find what are people saying about the Goldensoft fragrances now?> Is Word of Mouth from top tweeters / opinionators - the “Skintastics” -

influencing others to buy? How much?> What patterns can be merged between social buzz and retail sales that can

influence demand planning and inventory rollout, as well as marketing plans for signage, end cap displays, regional TV spot buys, and other promos?

Chi TylanaBSI Lead

MercedesMarple

Stella, GroupBrand VP

MarcoEspinoza

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Scene 2: The BSI Team Divides up the Work

Chi: let’s integrate POS with 2 studies of Goldensoft customers

> Marco: do Sentiment Studies on attitudes re fragrances – monitor the blogs/tweets for preferences using sentiment analytics

> Mercedes: detect and study the influence impact of the Skintastics on others, with a viral couponing campaign

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Scene 3: FOUR Weeks laterThe team goes over the 2 studies with Stella

• Marco collected and did some sentiment analytics using Attensity’s Twitter Firehose Extraction tool. Reports show (see next pages):> 1000+ raw tweets, positive, negative and

neutral> Tweets vs. competitors, normalized to 100% and color-coded positive/negative> Drill down on sentiments by Fragrance> Sentiment changes by week, by region

• Looks like Almond and Coconut are going to be very popular sales items!

Marco Used Attensity to Capture & Analyze Twitter Sentiment - Overview

LISTEN: 75+ million online sources including Twitter, Facebook, blogs, review sites, earned and paid media

ANALYZE: Get real business insights in

32 languages with over 100 reports &

dashboards. Drill down to the details

behind the sentiment.RELATE: to your internal reporting, CRM and business systems.

ACT: reach out and engage with Attensity Respond.

Plus internal sources like emails, surveys, owned media, private forums

ATTENSITY VOC COMMAND CENTER

Raw Tweets, Both Positive and Negative

Captured from subscription to

Attensity Twitter Firehose

Then scored for intensity of comment

and graphed (next pages)

Can also capture tweets on competitors (Magic Elixir and Erfrischer)

Sentiment : Goldensoft vs. Competitors

CompetitorBrands

Note ratio of positive: negative for Goldensoft is good; 8:1

Drilldown: Sentiment on 5 Fragrances

Drilldown: Tweets on Almond, by Region

Sentiment on Fragrances Over Time, South Region

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2nd Study: Mercedes Studies Viral Couponing

• Begins by looking at first purchases vs. repeat purchases (POS data)> Using Loyalty Data analytics (CPG

Manufacturers are increasingly getting basket-level loyalty card data from their retailers)

> Looks for an "early adopter" segment from store sales data,

> And a "repeat purchase" metric

One issue with CPG product launches is that blanket media communication can drive high levels of trial giving the impression of a big success, but no repurchase as the product doesn't live up to expectations leading to a slump in demand, usually just after the CP has invested a ton in packaging and ingredients because of the initial demand!)

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Report Showing Initial vs. Repeat Purchases

0

5

10

15

20

25

Lime Spice Ginger Almond Coconut

OverallLoyalRepeat

Goldensoft Hand Lotion- Repeat Buy Analysis, By Fragrance

Repeat buys of Lime and Spice are low!Repeat buys of Almond and Coconut are outstanding!

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Mercedes’ Coupon Campaign for this Segment

• A coupon offer with two parts> $7 off for the individual OR > $20 off if at least 2 other friends also buy the product

• Mercedes Runs a “Viral Couponing” Campaign> A real-time social media couponing experiment, (much like

what Jimmy Dean Sausage tried, see later slide) > Sends out coupon offers to the Skintastics segment> Analyzes how people influence their friends to purchase> Can see coupon campaign results – by fragrance type> Also by region

• She starts by creating a Skintastics Segment – Loyal customers who bought Goldensoft at least once before and

typically become repeat purchasers of cosmetics

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Viral Coupon Campaign Deployment on Aprimo

InnerFirewall

TeradataDatabase

TCIM ClusterTCIM

Load Balancer

Aprimo RelationshipManager, part of Aprimo Marketing Suite

ARM/Administrator

OuterFirewall

DMZ

Corporate Intranet

Reporting User

Marketing User

Emarketing Server

Social MediaInfluencers

Social Feed Social Feed

EmailOffer

Send Email Offer

Po

st M

essa

ge

s

PostSocialData

2. Sends outEmail Coupon

3. Skintastic Influencers Get Email Coupon, pick option

4. Forward via Email, Facebook, Tweets, with a copy to Great Brands

7. Mercedes analyzes POS redemptions in Aprimo to see how coupons are used

6. ETL POS data

5. Skintastics and friends redeem coupons

POS

1. Mercedes Sets Up The Campaign For “Skintastics”

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Mercedes Uses Both Aprimo Marketing Analytics and Campaign Automation

Marketing Analytics

MiningModeling

Reporting Trending

ProfilingSegmenting

Marketing Operations

Workflow & Rules

Plan Spend

BrandAssets

CampaignDesign

Multi-Channel Campaign Automation

LeadsCampaign

Automation

Source Data

Product/SKU

Product/SKU

InventoryInventory

Sales/POS/

Franchise

Sales/POS/

Franchise

SupplierSupplier

Promotional/Loyalty DataPromotional/Loyalty Data

Strategic Insight and Marketing Processes

Seamless Customer Engagement

CallCenter

Events

Email

Mobile

Channels Customers

Sales

Consumer

Partner

Pre-engineeredConsumer-

centricData

ManagementAssets

Data Warehouse

Consumer

Feedback Loop

Social Media

Web

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Mercedes creates a “Skintastics” Segment

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Mercedes Creates a Communication Plan

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Mercedes kicks off Campaign ExecutionEmail offer goes out and redemptions begin

• She waits to see who opens the email, who forwards it, how they forward it, who buys (both targets and friends), which fragrance they buy

• Redemptions. To “stitch together” the results, they give $7 off right way when the Skintastic buys, and a $13 credit later when the 2nd friend buys

• Data. Mercedes used Teradata to tie together Skintastic IDs, Coupon IDs, plus their CC message types on how Skintastics forward the offer, plus the POS codes (to find 3 redemptions of the same coupon ID)

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Mercedes’ “Skintastics” Viral Campaign Experimental Results

• We saw variations by region – South and Central reacted strongly

• In trial of 2000, 46% (920) responded to the coupon. Of those:> 68% sent to 2+ friends to try for

the $20 coupon.> 62% emailed it, 32% facebooked,

4% tweeted the coupon. > One of the rules is that when you

forward it, you cc Great Brands.> Their friends redeemed at a 42%

rate.> Clickthrough rates on Facebook

were 68%, email 41%.

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Chi Compares Marco’s Sentiment and Mercede’s Viral Coupon Study to the POS Trends

• Real-time data from the POS scanners in the stores and online flows into the Great Brand’s Teradata Integrated Data Warehouse so she can also see purchase trends above and beyond the 2 BSI studies

• Integrating and analyzing all this information confirms to Chi that the Great Brands Marketing Plan needs to change

0%

50%

100%

1 2 3 4

Week

Real-Time POS Data - Goldensoft Fragrance Mix - Last 4 Weeks

Almond

Coconut

Ginger

Spice

Lime

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BSI Recommendation: Revise Your Marketing Plan

BSI discovered 2 things from the investigative workstreams… 1.Almond & Coconut were not planned as biggest hits, but are in

fact the Goldensoft stars of the launch – Great Brands has to increase demand forecasts!!! Both the Sentiment Study and Viral Coupon study, coupled with the latest real-time POS feeds, show this trend will impact your sales forecasts.

2.A viral email coupon campaign will create huge ROI especially in the Central and South regions – Stella needs to redo her Marketing Plan

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Chi’s Advice: Revise the Marketing Plan

Chi: based on these results, suggest you change your mix to more WOM marketing. Suggest stronger B2C marketing efforts in 2 regions - Central and South Regions – where a larger percentage of repeat buyers reside.

Stella: We’ll redo our plan – this actually saves us quite a bit of money if we don’t have to spend on regional TV – the CouponCampaign is less expensive way to get the Same impacts

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Scene #4: Marco Calls Supply Chain VP David Hefenhaus with details results

“Even though you are in limited stores right now with the new fragrances, we think you are going to have a big problem… David, the Almond and Coconut fragrances are most likely severely underplanned!”

David: OK, we will take a look at revving our production forecasts. Stella and I also see new POS data, which is shifting in the same direction. We will create a new plan. Shoot over your findings and I’ll revise our SAP APO plan, then talk to our suppliers.

© Teradata 2011< 33 >

After studying the details, David comes up with a new Goldensoft Production Plan

He does some quick math on Almond Extract incremental needs, then calls his supplier Francois in France to buy 800 extra kg.

The Math: The monthly Almond plan changed from 20-28-35-20 thousand to 30-48-62-77 thousand cases, and from 103,000 units total to 217,000 units. Each 3 oz unit needs ¼ oz of almond product, so 1 pound of almond extract is good for 64 units. Then the difference of 114,000 units needs 1781 pounds or 809 kilos more almond product

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David’s Revised Goldensoft Production Forecast

Focus is on getting more extract for the almond line)

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Scene #5: After the Holiday Crunch Stella and Dave Meet with Jan to Look at Results

And, we had12% fewer stockouts 18% less leftover inventory

• We had 10% less Marketing spending vs. plan because of the word of mouth campaign

• 15% more product sold vs. first estimates• 8:1 payoff on Marketing $$$

Good job team – I’m happy to see that the replanning with better data paid off!

© Teradata 2011< 36 >

SUMMARY: Another Victory for BSI: Teradata!

Synchronized Supply Chain Planning

And Chi Is Duly Impressed By Mercedes’ and Marcos’ Work on their Very First Case !

Better Market Spend Planning, Integrated Marketing Mgmt, WiderVoice of the Customer

© Teradata 2011< 38 >

For More InformationOther Companies Using Social Media

•Jimmy Dean Sausage Offerhttp://www.consumergoodsclub.com/cgc-official-blog/78-marketing/781-jimmy-dean-foods-on-facebook

•Coca-Cola article on Social Media Marketinghttp://searchenginewatch.com/article/2095613/Social-Media-Mastery-Wisdom-from-the-Leaders-of-Coca-Cola

•See also the BSI “Case of the Retail Tweeters” episode on Brizio Fashion

http://www.youtube.com/watch?v=pVb8Dkd2mck

•And a writeup about social media in “BI Experts Perspective: Structured and Unstructured Data” in Business Intelligence Journal, Vol 16, Number 2, available from TDWI (requires membership)

• http://tdwi.org/research/2011/03/business-intelligence-journal-vol-16-no-1.aspx

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3 Teradata CPG Customer Talks about Big Data Presentations at the Teradata Partners Event 10/2011

• How Coca-Cola Leverages Rocket Science to Drive Retail Results - Actionable shopper insights are a critical and competitive success factor for consumer goods companies, and Coca-Cola is among the most progressive when it comes to taking a data-driven approach to understanding the consumer. This session shows Coca-Cola exploits pattern recognition over large data sets to better understand shopper behavior and how shopper and consumers interact with products.

• "Quenching the Thirst for Master Data at MillerCoors" – Using MDM” - is especially applicable in consumer goods companies where maintaining consistent data across supply and demand chains not only helps reduce cost, but allows market and business-driven changes to be implemented more quickly all while keeping an accurate up-to-the-minute pulse on the entire business.

• “A Recipe for Success: Driving better Trade Funds ROI with External Data” - Trade promotions are second only to cost of goods sold on the books of consumer goods companies, yet many CG firms struggle with understanding the real impact of these investments? “This session discusses Sara Lee’s Demand Signal Repository (DSR) initiative that built a DW platform to house, integrate, and deliver a range of external and internal data to drive business results.”

© Teradata 2011< 42 >

For More InformationLinks to the Technologies Used in this Case

•Aprimo www.aprimo.com •Teradata www.teradata.com

•Attensity www.attensity.com http://www.attensity.com/2010/10/20/attensity-partners-with-twitter-to-provide-innovative-social-media-customer-service-and-analytics-application/

•SAP www.sap.com http://help.sap.com/saphelp_apo/helpdata/en/7e/63fc37004d0a1ee10000009b38f8cf/frameset.htm

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Customer Successes with Aprimo’s Integrated Marketing Management Environment

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Improved visibility of the marketing spend from 11% to over 85% to make educated adjustments to spend

Increased campaigns from 200 to 1000+ without expanding resources

Lowered campaign cycle time by almost one-third and increased number of campaigns by 29%

Consolidated databases for better communication & more effective customer and prospect leads

Decreased time to market for customer campaigns and interactions and increased sales volume by 38%

Eliminated hours of manually managing spreadsheets and marketing initiatives and improved targeting ability and lead generation

Saved $4M in operational expense & drove $5M in incremental revenue through reduced campaign cycle time and reduction of resources

© Teradata 2011< 44 >

The End

• We hope you enjoyed the BSI episode and this accompanying writeup covering How We Did It.

• Stay tuned for more BSI episodes. And “Like” us at www.bsi-teradata.com or “Friend” us on Facebook!

Chi and Jodice

BSI: How We Did It - The Case of the Fragrant Sleeper Hit

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Transcript of BSI: How We Did It - The Case of the Fragrant Sleeper Hit