Interview: Teradata’s Asia/Pac VP Dennis Samuel on taming data
Data, data everywhere but not a drop to drink. When leading marketing technology and analytics outfit Teradata surveyed 2000 marketers globally recently it discovered that 50 per cent of executives identified data as the most under-utilized asset in the organisation. Worse still, less than 10 per cent said they are using their data in any systematic way .
Those same CMOs identified cross channel integration as a major corporate priority, and that means a company’s data assets are increasingly crucial to success, says Dennis Samuel, VP Teradata Applications, Teradata.
Which-50 has spent the last month talking to leaders in Australia’s marketing technology sector to get their insights into the key challenges facing those companies embarking on the journey to digitise the customer relationship.
Each comes at it from a slight different perspective. Adobe for instance views the market through the prism of creativity, Salesforce.com not surprisingly from the perspective of selling, but for Teradata the frame of reference is data, and the processes needed to tame it.
According to the Teradata VP the problem which marketers now face, while daunting, will be familiar to many business managers who lived through the emergence of enterprise resource planning in the 1990s.
ERP, and particularly SAP’s R3 helped many large, distributed and complex organisations create an integrated view of manufacturing, warehousing, distribution and supply chain.
And that model is a good way to imagine Teradata’s approach to solving the problem marketers now face, says Samuel.
“If you look at what happened in the 90s in the IT industry companies like SAP and Oracle automated the enterprise through ERP.”
However, once the dust settled on what at times proved a difficult and costly transition the last bastion of automation – marketing – remained unreconstructed.
“That’s the space we are filling today.”
“At one end you have resources coming in the form of budgets, money, plans and strategy, and at the other end you have an output which is typically a communication to a customer such as an offer.” he says. “The important thing is that there are a whole bunch of processes required to link those two milestones together.”
And there’s the rub. Marketers are not necessarily process experts. No kid whoever dreamed of a career in the dark arts ever leapt out of bed the day after graduation shouting “Workflows!” Not when their heads are filled with visions of corporate cocktails, red carpets and endless summer pool parties.
Perhaps that’s why Teradata’s research found that while companies are drowning in data, more than 90 per cent lack the systems and processes necessary to address the problem strategically.
“This is all about data integration and the process that’s wrapped around that to make a marketing organisation as effective and productive as possible. “
And there are big wins for CMO’s who get this right. Digital marketing budgets are growing but so are demands for better ROI. For all the measurability of digital marketing, practitioners remain strangely sanguine and reticent about its effectiveness.
By deploying an integrated marketing operating system, CMOS’s now hope they can reduce costs, increase productivity and ensure every part of the organisation is as efficient as it can be says Samuel, “The bottom line and this came out very strongly in the report, is that everything must have an ROI on it.”
Marketers are looking to create a 360 degree view of their customers and to do that they are using not using only their own internal transactional data or billing data but increasingly they are interrogating the open web and using information from social media channels.
In the frightening short term they will have to add information such as machine to machine data which will amplify complexity. At the start of the year there were 1.5 billion smart phones in the world according to ABI Research. By 2017 there will be over 3 billion by most estimates. But the data challenge presented by those connected consumers pales compared to what the world will look like by 2020. In just seven short years analysts believe their will be 80 billion things on the Internet of Things.
Here’s what that looks like with the zeros attached 80,000,000,000
It also helps explain why it is critical that companies get their technology in order now.
Teradata’s response to the endless binary fire-hose is its Integrated Customer Engagement solution (ICE). The promise of ICE is that by combining things like big data analytics, data delivery, behavioral and contextual data, comprehensive predictive analytics, and real-time messaging, it will enable companies to distribute relevant real-time messages across their multiple channels.
For example, says Samuel, transactional messaging is a big driver for marketers right now. “But all of that messaging has to be managed using appropriate tools that get the communication out to the customer and then ensures those responses are being tracked and fed back into big data infrastructure to help with decision making.”
Just like its customers, Teradata has been on a digital journey in recent years and has spent almost a billion dollars since 2010 rounding out its marketing technology stack with three important acquisitions;
- Dec 2010: Teradata paid $US525 million for marketing software company Aprimo. At the time of the acquisition Aprimo was already providing applications to over 150,000 professionals world wide and had 36 per cent penetration into Fortune 100 companies. The company explained the rationale for the purchase on the basis that it would be able to help its customers accelerate time to market for revenue-generating campaigns, leverage data to gain strategic insights, recognize emerging opportunities early, and optimize and deliver successful campaigns seamlessly across all digital channels.
- May 2011: The company paid $US263 million for Aster (of which it already owned 11 percent). Aster is a big data specialist with massively parallel database solutions equipped with built in analytics capability which specializes in unstructured data. And as technology like Hadoop has become more popular the Aster acquisition looks more prescient.
- May 2012. Almost a year to the day after the Aster deal Teradata bought German based e-Circle which Samuel describes at EMEA’s leading digital messaging company. The terms of that deal where not disclosed. In March this year Teradata merged e-Circle and Aprimo into Teradata Applications.
All three acquisitions are indicative of the prevailing market trend where incumbents are rounding out their offerings in order to provide a cradle to grave marketing solution.
EMC’s purchase of Greenplum for $1.7 billion and IBM’s acquisition of Netezza also fit this bill as does Salesforce.com’s recent acquisition of Exact Target.
Teradata grew out of the world of enterprise wide data warehousing, and for a long while during its time as a subsidiary of NCR it was regarded as a one product company focused on building enterprise wide analytics. (it was spun off and floated on the Nasdaq in 2007.
The unique nature of its technology meant it was well suited for the efficient management of very high volumes of data which by that curious combination of market intuition and gravity lead the company naturally towards high consumer businesses such as banking, telecommunications, retailing and government.
In Australia for instance, Samuel says every major bank and telco is a customer and the company has a significant presence in the Australian government. Interestingly though it’s only in the last three to four years that it has expanded into the retail market down under.
“One of the things we discovered was that a lot of data held within Teradata systems globally was related to customers and customer management. In a sense that shouldn’t be too much of a surprise to anyone as its typically where most companies start when they buy a Teradata system.
“But that lead us to think about how we could further explore our significant presence in that part of our customers’ organisations.”