To understand the prominence of business analytics in today’s world, a 2009 paper released by Gartner predicted that by 2012, more than 35 per cent of the top 5000 companies would regularly fail to make the optimum decisions due to lack of information. With companies sitting on mounds of customer data that is becoming more and more difficult to analyze, business analytics and business intelligence firms are expected to prosper in such a climate.
While most analytics firms offer solutions that take anywhere between 6 months to a year to deliver and a price tag of $$,$$, an opportunity has opened in the market for hosted analytics firms with their quick to deploy solutions to grab a large chunk of the market. An Indian start-up, The Enterprise Genie(TEG) has just done that, and over the past two years has made inroads into the Indian organized retail market. Yourstory catches up with TEG founder Arvind Nagpal to share TEG’s story with you.
How I became an entrepreneur
After working with global companies through the eBusiness boom/bust, ERP wave, and the global delivery phenomenon, one thing that stood out was the vast data assets getting built in these organizations. I always had a desire to build something of my own. After spending nearly two decade in the US, and a background in Operations Research, I moved to India 6 years ago. India had all the ingredients to build a perfect storm in Analytics: it has the quantitative talent, a vast unorganized Retail, and data whose quantity and quality was increasing by the day. There was an opportunity to deliver significant value to businesses. The economy was booming, the mood was upbeat. To me, it became a no-brainer to jump into the entrepreneurial game.
How TEG was founded
I got introduced to my partner, Sunil Garga and Todd Kirk, in the US through a common friend. Sunny and Todd were also looking for a partner in India. Sunny and Todd bring a great deal of expertise in the Retail and CPG industry. They are considered as Thought leaders in Marketing Mix Modeling and have over two decades of experience with companies like IRI and MMA. Retail and consumer goods industry is what we knew the best. We started working with clients in the US, then through the same clients we got entry into other markets like Latin America and China. Most recently, about 8 months ago, we started venturing into the Indian retail market as. Fortunately we’ve been able to close some key accounts in the Indian market as well.What they do
We use Advanced Analytics to solve complex business issues based on data. This could range from decisions on store locations, optimal store size, the right assortment of products, their pricing, determining the elasticity in product pricing, measuring the success of various promotions, or segmenting the customers for better targeting especially with Loyalty card data. One of the things that is getting a lot of traction with retailers is helping them understand drivers of sales at various stores. Everyone knows location is the number one factor, but most people don’t know what number two, three, or four is. We help them analyze their data and understand what those factors are.
How do companies approach Analytics?
Companies have two broad choices: 1) They can build an in-house team, invest in people, infrastructure, and processes. This could take anywhere between 6 months to a year 2) Engage with an Analytics company that understands the domain and data. The biggest challenge in the first approach is that responsibility is handed over to the IT group where it seldom finds wings because of competing priorities. The know-how is also limited in the Indian market.How TEG does things differently
The key differentiator for us is the time to market and affordability. We provide our solutions on a hosted platform as a service. In our solution, we have made the investment in infrastructure, developed various IPs, assembled a team of domain experts, and established processes to ensure data accuracy and answer the “So What” question. Our clients provide us a set of business briefs and access to data. In as little as 6 to 8 weeks they have access to advanced analytical outputs at their finger tips through our platform.
We provide our customers full access to the data that is clean and harmonized for advanced analysis. In the real world, you typically know 20 to 30 pc of the questions upfront, but the remaining 70 pc of the questions are ad-hoc analysis that needs to be done depending on the needs of the business at that hour. And through our platforms, our customers have access to their own data and they can slice and dice the information to get those insights and make better business decisions.
We work with clients in the US, Latin America, and India. Our recent wins in India include clients like Lifestyle and Nike. In rest of the world, we are also working with global companies such as Avon, Johnson & Johnson, and Clorox to name a few.
While we put some seed funding through our friends and family, we were also fortunate to land up some key clients in the early stages. So we never had to reach out to the VCs for any funding. We are cash flow positive but we are looking at infusing some capital in ~6 months to fund our growth.
The challenge in the Indian retail market is the pace of growth. It is a land grab time. Analytics is important to companies, but it competes with energy spent in fighting the expansion battle. At the same time, leaders in the industry recognize the benefits of analytics and they have already embarked on several initiatives. If you look at some of the leading companies such as Lifestyle, Shopper’s Stop, Dominos, Future Group, they’re already leveraging analytics as a weapon of competitive advantage. However, quite a few of the tier-I companies have not caught on to analytics as yet. But we only look at it as a matter of time. Its not a question of ‘if’ but of ‘when’.
We don't have a readily available supply of good analytics talent in the market. One has to find the “raw material” and convert it into “Supply”. There are limited options. We do get a few good people on the market, but the demand clearly outstrips the supply. So you can’t be chasing the few people in the market, you have to build it for a long term sustainable model.
Any concluding comments?
Data is your asset. You can get an unfair advantage over your competition using insights from your DATA. Go on to seize the opportunity.