NASHVILLE: Since 1992 — when Visionary Extraordinaire Steve Jobs was one of the 200 attendees — Teradata has been hosting an annual data-focused conference, but this year’s event marks the first time that the majority of the 4,000-plus attendees (up from last year’s 3,600 attendees) come from the business, and not IT professions. The company has made a lot of product, service and partnership announcements leading up to and during this week’s gathering, but it appears that it’s the ‘who’ rather than the ‘what’ that really matters.
Perhaps the comments from Darryl McDonald, President, Teradata Applications, at Partners 2013 illustrated why this year’s event is bigger, and more business focused. There are a number of benefits to data-driven marketing, from increased profitability and decreased costs to greater customer retention, but the biggest driver is fear, he said. It’s digital disruption, a “business phenomenon with a body count.”
The fact that the first 30 minutes of the opening keynote was delivered by a customer was another strong indication that the world as we know it has changed. Kathy Koontz, Associate VP, Customer Information Management, Nationwide Insurance, said her company embarked on a strategy to deliver a consistently strong customer experience using data to drive better decisions back in 2008. “Our goal was delivering differentiated customer care.”
Data is the raw material for analytics, and the insurance company tracks everything about its customers, she said, with one huge caveat. “Data that’s not actionable is just data!”
Quoting Teradata’s Bill Franks, Chief Analytics Officer, Koontz said in the evolution of data, we’re now in the industrial age of analytics. “Data and analytics can transform any organization, big or small!”
Teradata President and CEO Mike Koehler followed Koontz, and said that companies that make data-driven decisions are more effective — 5% more productive and 6% more profitable — according to an MIT study. “The competitive battle field can be won or lost by analytics”, he stated.
Referring to the MIT study, Bob Fair, EVP and Chief Marketing and Information Officer, Teradata (looks like the company sidestepped the whole CMO vs CIO controversy by combining the two positions) added “That’s enormous. You can’t survive long if your competitors are beating you by 5-6% on the bottom line.”
According to a recent Gartner survey, North America sits atop the Big Data pile of… well, Big Data. However, the 302 responses from the research company’s Research Circle members showed that only 13% say their Big Data projects have deployed to production.
Teradata just released its own survey on digital marketing and analytics and reported a similar disconnect from its 400-plus digital marketing leaders at large global enterprises. The top two findings were the need for the integration of technology and data, and using personalization to improve the customer experience, said Michael Lummus, Director of Digital Marketing Solutions, Teradata Marketing Applications.
The key takeaway? The debate about how to approach the modern consumer is over: the largest marketing organizations have concluded that enhancing customer relationships via multiple digital channels best supports sustainable growth and reliable retention.
The disconnect between marketers’ intentions and capabilities is mirrored elsewhere in organizations, according to IBM surveys. Most organizations (70%) believe in the importance of cloud, analytics, mobile, social computing and security, but less than 10% are ready for it.
The Teradata study reported that by 2019, the average investment in digital marketing will be approximately 40% of companies’ total marketing expenditure, up from about 25% today. Mobile will continue to be an area of emphasis, with 34% saying they plan a significant increase for 2015.
IBM may have been preaching that Infrastructure Matters at its Enterprise 2014 event 10 days ago, but analytics, Watson (its AI system capable of answering questions posed in natural language) and its ecosystem were certainly given a lot of attention. “The next great innovations will come from people who are able to make connections that others don’t see and Watson is making possible,” said Mike Rhodin, SVP, IBM Watson Group, in a prepared statement.
“Analytics is what clients need to grow their business. It’s all about business outcomes,” said Cindy Grossman, VP, Business Analytics & Optimization, IBM Systems & Technology Group It’s still early days, she added, but analytics use is growing in IBM’s customer base, especially in areas like fraud detection and retail.
Customers have been telling Tom Rosamilia, Senior Vice President, IBM Systems & Technology Group, that they are swimming in data. “I don’t need more information, I need more insight,” he said during his keynote presentation.
As much as data warehouses, business intelligence and analytics have been around in one form or another for years, the Big Data/analytics revolution has a long way to go. Last December IDC reported that the Big Data technology and services market will grow at a 27% compound annual growth rate to $32.4 billion through 2017 – or about six times the growth rate of the overall information and communication technology (ICT) market.
That’s a lot of money to be spread around and Teradata is hoping to get more than its fair share .“Data is the currency of today’s economy,” said Fair. “We are the original Big Data company.”
A month ago Wikibon’s Jeff Kelly, blogged that Teradata is a heavyweight in the data warehouse world, but that world is undergoing rapid change. As a result, Teradata is taking significant steps to make sure it has a place atop the developing Big Data landscape.
‘Teradata has already made a start in this direction with its suite of marketing optimization applications. The company needs to develop additional targeted applications in key vertical industries including financial services, retail and healthcare, industries heavily represented in its customer base. If it takes this path while continuing to serve as a trusted data management steward to its clients, Wikibon believes Teradata has a good chance of coming out the other side of the current Big Data disruption in a strong market position.’
Teradata is not unique among IT vendors taking a business outcomes focus. However, it is one of a small handful playing in the Big Data analytics space that also has the size, scope and product and service portfolio that should equip it to do well here.
DISCLAIMER: Teradata looked after airfare and accommodations.