The Times Group Corporate Initiative Response IntelliQuote · Digital Transformation of Print Media...

Digital Transformation of Print Media Sales

Raman Agarwal, Strategy and Pricing

30th January 2019

Response IntelliQuote

The Times GroupCorporate Initiative

Acknowledgements

1

System Architecture

Raman Agarwal

Prashant Dogra

Paresh Thakur

Vikrant Desai

Analytics

Raman Agarwal

Neeraj Chhabra

Yuvraj Relan

Sunit Chandan

Siddharth Dubey

Nitesh Kumar

IT Implementation

Paresh Thakur

Vikrant Desai

Sachin Kale

Rajesh Rebello

Rahul Jha

Nitendra Singh

Lalit Anand

Babusha Sharma

Rajat Srivastava

Kriti Taneja

Parag Bhangle

Tableau Integration

Rakesh Baboota

Devanshu Verma

Vivek Kumar

Adarsh Saikia

Project Sponsor

Sivakumar Sundaram

Concept & Design

Raman Agarwal

Consultations

Subramanian S

Deepa Bharti

Amit Kumar

Reference and Inspirations

2

# Topics Source

1 Pricing Guidance in Ad Sale Negotiations Paper by Google India

2 Comparison of Accuracy of Statistical Models Paper by Dr. Hirotogu Akaike

3 Revenue Management and Dynamic Pricing Lectures of Prof. Goutam Dutta, IIM Ahmedabad

4 Advertising Industry and Trends KPMG Report 2018

5 Implementing dashboards in Tableau YouTube and online forums

6 Negotiation Theory Wikipedia links on ZOPA and BATNA

Foreword / Executive Summary

3

Bennett Coleman & Company Limited (BCCL) conceptualised, developed and architected a dynamic pricing

application – IntelliQuote - which predicts client specific prices in real time for a print inventory.

The algorithm is designed in such a manner that it triangulates prices from two different logics and once a sale is made the

machine learns the propensity of the advertiser to pay for the subsequent transaction. The state-of-the-art design is first of its

kind in the industry and works with an accuracy of 75%, i.e. majority of its predicted prices have potential to turn into orders.

Apart from predicting the “right price”, the application increases speed of business; monitors negotiation efficiency of the

sales team; aids in preventing price-arbitrage; and provides Tableau exportable reports for further R&D and trend analysis.

The application is accessible through a Mobile App or Desktop and is used by over 1500 sales personnel with over 1 Lakh

transactions till date, leading to a digital transformation of the sales team and enabling them with quote and floor prices on

the go.

The robustness of the analytical engine behind the application is audited and certified by two consulting firms independently.

Table of Content

1

2

3

4

Situation, Complication, SolutionThe problem at hand?; Plan to address it

Significant AchievementsIncrease Yield, Revenue; Digital Transformation

IntelliQuote – Under-the-hoodUniverse of variables; Broad Algorithm; Decision Support System

AppendixProject Timelines; Application Screenshots

Situation: The legacy pricing and revenue management system relied on ad-hoc decisions substituted for business intelligence

6

Sales Data(MIS)

Transparent Negotiation

Analysis

Cogent Pricing Models

Market Intelligence

orVOC

Pricing Strategy

Market Data

Real-Time Trend

Analysis

Real-TimeCalibration

SetPrices

Decision Support SystemAnalytics

Elements of a Dynamic Pricing System

MissingExisting Partially Existing

Competitive Advantage

Business Strategy

+ Sales Targets

Complication: The pricing model, negotiation process and route to market had critical drawbacks

7

Issue

03

Issue

02

Issue

01

Inaccurate Model with obnoxiously high rates

Slower Speed of Business

Price Inconsistency

Generic and

unpalatable

rates from an

outdated system

Manual transactions

depending on the acumen of

a human - Pricing Scientist

No tracking of

negotiation efficiency;

Risk of team’s churn

Sales team not

enabled to take

on-the-spot

Pricing decisions

Absence of a Live Decision Support System

Issue

05

Issue

04

Lack of Transparency

Archaic MIS for

business intelligence,

often unavailable for

Pricing decisions

Solution: A new eco-system is designed with a vision to increase Yield, Drive Productivity and Empower People

8

Co

ns

iste

nc

y a

nd

A

cc

ur

ac

y

Sp

ee

d o

f B

us

ine

ss

Tr

an

sp

ar

en

cy

Project Intersect

Regression & Analytics

Standard Multipliers & Revised ORs

Simpler Navigation

Pre-filled Forms

Improved UI

Auto Approvals

Auto Rate GridsCompletedWIP

Ch

an

ge

Ma

na

ge

men

t

Pricing Team

Sales Team

Alternate Models

Tracking Discounts

De

cis

ion

S

up

po

rt

Sy

ste

m

Automated Dashboards

Triangulate Forecast

Rev, Yield, MS

Occupancy

Buying Pattern

Integration with CRM

De-risk Sales Churn

Re-visit Statistics / Math

Third Party Audit

A confluence of sales and pricing

Mobile Application – IntelliQuote (iQ)

Table of Content

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2

3

4





IntelliQuote is able to increase the Yield by 5%, with an estimated annual revenue benefit of USD 10mn

10

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%Percentage Premium Achieved Over Usual Yield

Number of Transactions

% p

rem

ium

ch

arge

d p

er t

ran

sact

ion

Area under the curve represents

incremental revenue

G2 = Weighted Average Yield Increase

(Transactions through IntelliQuote)

*KPMG India Study 2018

Revenue Impact** = ~USD 10 mn

(Annual impact if volume is same and full

adoption by the sales team)

G1 = Average Print Market Growth*

(FY 2017 to FY 2018)

3.4%

4.1%

G1 G2

20%

** Check appendix for scenario analysis

Much more than an App, the IntelliQuote is a digital transformation of the sales team

11

Sales Pricing Team

Near Real-time Model Improvement

IT

Machine RatesRequest for Quote

Rates curated by SPOCsAuto Emails with Quotes

1 2

35

4

6

Automated Reports

Negotiation efficiency of Sales & Pricing Team by Markets, Verticals

Analytics to roll-out potential Spot Offers (Wish vs Closure)

Triangulation of Forecast Trends

No-offline rate to be maintained

De-risk team’s churn

For Regional and National Heads For President’s Office / Directors

In contrast to the legacy system, the IntelliQuote prices are well within the reach for sales to pick business

12

From

To

IntelliQuote shifts the computation load to a machine thereby facilitatingricher engagements between the Pricing and the Sales teams

13

Manual recursive Pricing Automated PricingSupervised Machine Learning

Archaic way of workingSubject to errors

Provides opportunity to control ratesBest of both worlds

IdealisticNeed supreme accuracy

1 2 3

IntelliQuote fortifies the competitive edge of the Times Group by delivering productivity and sales empowerment

14

Strategic priorities defined by the leadership to grow Print business in India to be carried till 2020

Table of Content

1

2

3

4





The legacy system used limited variables for pricing; The rest were considered for ad-hoc decisions

16

Industry Sector

Edition

Page Position

Ad Size

No. of insertions

Month

Occupancy

Opportunity Cost

Costs

Market Share

Consumption Pattern

Share of Wallet

Industry Growth Rate

Competition RatesEntry Barrier vs Defend

Launch vs Frequency

Agency RelationshipPotential Alliance

Non-Print Bundles

Color / B&W

Client Growth Rate

1 2 3

1

2

Traditional Variables

Contextual Variables3

Variables used in IntelliQuote

Affinity to PrintImportance for Brand

Paper Quality

Innovation

Existing vs New Client

Circulation / Print Order

Special Day/Event Premium

Government Regulations

Deal-Size

IntelliQuote expanded the purview - relevant variables are programmed; Dashboards built for significant ones

17

Industry Sector

Edition

Page Position

Ad Size

Month

Occupancy

Opportunity Cost

Costs

Market Share

Consumption Pattern

Share of Wallet

Industry Growth Rate

Competition RatesEntry Barrier vs Defend

Launch vs Frequency

Agency RelationshipPotential Alliance

Non-Print Bundles

Color / B&W

Client Growth Rate

2 3

1

2

Traditional Variables

Contextual Variables3

Variables used in IntelliQuote

Affinity to PrintImportance for Brand

Paper Quality

Innovation

Existing vs New Client

Circulation / Print Order

Special Day/Event Premium

Government Regulations

Deal-Size

Significant variables for which dashboards were made

No. of insertions

IntelliQuote’s analytical engine predicts client level prices with >75% accuracy

18

Accuracy is defined as predicted prices are about 30% premium on usual yield for the combination Data, Design and Results audited by two consulting firms

IntelliQuote exhibits stronger prediction of rates than ever before; Coaxing higher adoption by the sales team

19

Resolves Issue 1

Source: BW / SAP

IntelliQuote automates 66% of the incoming enquiries; increases productivity and speed of business

20

Price from Legacy System

Operating Yield

Card Rate

IntelliQuote Price

51% or 28k RFQs

Fixed + Variable Costs

85

% o

f R

even

ue

70

k

RF

Qs

Variable Costs

Note: Estimates are annual and are taken from the MIS on % of business approved below floor

15k RFQs

55k RFQs

Approvals by Sales Heads

Repeat Orders

53k/80k

66% Automation Achieved

10k RFQs Auto Approvals A

B

C

CBA ++

49% or 27k RFQs Manually Negotiate D

Automation

achieved through

the accuracy of

price prediction

by IntelliQuote

Resolves Issue 2 & 3

IntelliQuote lends transparency in the system as all stages of ZOPA* are captured to show leakage points, if any

21

Resolves Issue 4

Confidential

iQ

Confidential

* ZOPA – Zone of Possible Agreement

Z O P A *

Confidential

Confidential

“Let The Truth Prevail”

IntelliQuote, frees-up the Pricing Team to study business context using client-level dashboards

22

Resolves Issue 5

Right PriceWrong PriceRight Value Proposition to Advertisers using

Business Intelligence

From Here To Here

Note: Under Project Intersect, Real-time Tableau Dashboards are designed for decision making. For confidentiality reasons they are not shown here

Table of Content

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2

3

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Project Charter

Appendix

IntelliQuote - Project timelines and charterSeveral modules were built, working in close quarters with Product, Sales and IT Team

25

Jan 2017

Change Management

Discussions with Leadership

Develop Tableau Scratches

Develop ModelsShadow Launch with

Pricing Team

External Audit - Data Validation and Math

Integrate Authorizations

CRM IntegrationBuild new GUI

Automate Rate Grids

Create Calibration Cell

Execute logics

Go-Live

Train Sales Team for Pilot

Pricing Simulator

Cost IntegrationDesign Test Simulator

Infuse system for auto approvals

Update GUI after VOC

IT Implementation

Decision Analytics

Newsletters and Success

Announcements

Training Collaterals

Build MRW / App

Innovations

Calibration Models

Index Utility

Re-visit regression and data-cleaning

Special Rate Flag

Test Fixtures

Decision Support SystemTableau Training

Non-Display

Draft New Process

Pricing KRAs for Adoption

Pilot / Beta

Jul 2017 Dec 2018Jan 2018 Jun 2018Mar 2018

Design Architecture Implementation, Testing, VOC

External Benchmarking

26

W1 W2 W3 W4 W5 W6

• Data clean up

• Data Gap Analysis

• Outlier capping

• Missing data analysis

• Data Imputation

• Data Standardization

• Understand data distribution

• Creating distribution diagrams to understand the distribution of variables

• Creating descriptive statistics to understand the variable relationship

• Creating Analytics records datasets

• Multicollinearity check

• Model preparation

• Modelling

• Model preliminary testing

• Iterate to get better Accuracy and precision

• Testing the models on sample data

• Business validation

• Sharing results with top management

Data Standardization and development

Model ready datasets

Initial Model Creation

Implement with IT

Validation of selected inventories by business

Finalized Model

Steering Committee with President

Modeling commencement

Model Testing and Iteration

IntelliQuote – Project plan for architecting the model and processesAssess integration requirements, check analytics models and verify the approach for business measurement

Project Plan from January to July 2017

Estimated Revenue Impact will be in the range of USD 2mn to USD 15 mnCalculated considering no volume impact with price increase

USD 160 mn(Effective Business on which iQ will be

able to impact)

S1: Optimistic

$ 15.0mn

S2: Realistic

$ 7.0mn

S3: Pessimistic

$ 2.0mn

Assumptions

Effective Volume (Compliance)

Price Inc. on Premium Inventory

Price Inc. on Inferior Inventory

80%

10%

4%

60%

6%

2%

40%

4%

0%

27

Application Screenshots

Appendix

IntelliQuote is a mobile ready application to facilitate requests for quotes on-the-go

29

Response IntelliQuote

1/3

Copyrights Reserved with BCCL, a Times Group Company

IntelliQuote is a mobile ready application to facilitate requests for quoteson-the-go

30

2/3


IntelliQuote is a mobile ready application to facilitate requests for quoteson-the-go

31

3/3

Confidential

Confidential


IntelliQuote offers a user friendly dashboard for the sales team Quick and easy access of prices by industry / client / publication / position

32

Co

nfi

den

tial


33

3 RFQ raised for individual Editions till date

No Packages for the above inventory

One combined RFQ raised for the above inventory

Download excel for the below search

The Pricing Team can search the application and check parallel negotiations and avoid instances of price arbitrage


Live Calibration using Tableau

Appendix

Area of concern is to make sure the

machine throws rates above the average

operating rates

IntelliQuote is integrated with Tableau to facilitate continuous calibration by the Pricing Team 1/2

35

This part is the Negative skew of the bell curve.These are all the cases which are below the Average Operating Rate

This part is the Positive skew of the bell curve.These are the cases where the machine had generated rates above 40% of the average operating rate

The average operating rate

Histogram of errors divided into three parts

Source: BW. September and October 2018

Machine vs Average Operating Prices

IntelliQuote is integrated with Tableau to facilitate continuous calibration by the Pricing Team 2/2

36

The data is analysed by 14 individuals, each responsible for an industry vertical

Source: BW. September and October 2018

Human Prices vs Average Operating Prices

Machine Prices vs Average Operating Prices

End of Document

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