Wade Tubman.pdf

The Game is Changing:Using big data to make big decisionsWade TubmanMarch 2013© 2013 The Quantium Group Pty Ltd. In Commercial Confidence

Everyone is talking about Big DataSource: Press releases© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 2

US government has announced a $200m Big Data R&Dinitiative to “accelerate innovations in science,engineering, education, business and government”© © 2013 2013 The The Quantium Group Pty Pty Ltd. Ltd. In In Commercial commercial Confidence confidence3

We probably haven't heard thename of what will be the world'slargest company in 2020Rupert Murdoch© © 2013 2013 The The Quantium Group Pty Pty Ltd. Ltd. In In Commercial commercial Confidence confidence5

AgendaBig data and the data scientistBig data in actionBig data challenges – the journeyfrom transactions to insightsInsights on online retail© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 6

AgendaBig data and the data scientistBig data in actionBig data challenges – the journeyfrom transactions to insightsInsights on online retail© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 7

Harvard Business Review features the “Data Scientist”“The SexiestJob of the21st Century”Source: Harvard Business Review© 2013 The Quantium Group Pty Ltd. In Commercial Confidence8

“Data Scientist : The Sexiest Job of the 21st Century”Harvard Business Review identifies data scientists as those who:make discoverieswhile swimming indataadvise executiveson the implicationsof the datacan clean and jointogether rich datasourcesare creative indisplaying informationand patternsbring structure to largequantities of formlessdataintense curiosity togo beneath thesurface of a problemSource: Harvard Business Review© 2013 The Quantium Group Pty Ltd. In Commercial Confidence9

First Principle of Success in Big DataRegulation, Data Protection and PrivacyUnderstanding the regulatory environment, ensuring strictcompliance with data security and privacy considerations© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 10

Complementary capabilities in unlocking big data valueConsider the richness andinformation value of dataSolutions to cleanse, manage,and interrogate data in real timeDataHardwareandSoftwareSo-what? Genuine insightslead to good decisionsAnalytics© 2013 The Quantium Group Pty Ltd. In Commercial Confidence11

AgendaBig data and the data scientistBig data in actionBig data challenges – the journeyfrom transactions to insightsInsights on online retail© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 12

Market Blueprint ® : using big data to deeply understandAustralian consumersAll electronicpayments:FactbasedOver 2.5mconsumersNationallyRepresentativePrivacycompliant1. De-identified:never receiveany personalidentifyinginformation2. High leveldemographicandgeographicinformation3. Results strictlyaggregatedhttp://www.quantium.com.au/privacy-policy© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 13

Mount Everest 8,848 m“Compulsory Big Data Infographic”Market Blueprint ® containsthe equivalent transactions asa pile of paper bank statementsas tall as Mount Everest© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 14

Big Data produces the NAB Online Retail Sales Index© 2013 The Quantium Group Pty Ltd. In Commercial Confidence15

… and the NAB Charitable Giving Index© 2013 The Quantium Group Pty Ltd. In Commercial Confidence16

Market Blueprint ® big data creates “People Like U”UBank’s www.PeopleLikeU.com.au allows all Australians to profiletheir spend behaviour against similar people…© 2013 The Quantium Group Pty Ltd. In Commercial Confidence17

Big data as an observational research toolMarket Blueprint ® allows anenormous sample to analysedlongitudinally using actual(rather than claimed)behaviourSurvey based on1,000 peoples’stated responsesonce per yearMarket Blueprint ® based on theactual daily purchasing behaviour ofaround 100,000 people who haveshopped at a particular shoppingcentre in the last 12 months© 2013 The Quantium Group Pty Ltd. In Commercial Confidence18

Breadth of understanding - traveller profiles© 2013 The Quantium Group Pty Ltd. In Commercial Confidence19

AgendaBig data and the data scientistBig data in actionBig data challenges – the journeyfrom transactions to insightsInsights on online retail© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 20

Transformation from transactions to the NAB indicesCulminationof tens ofthousands ofman hoursof workKey insights fromNAB ChiefEconomist andGroup EconomicsOnline transactionsby almost2 millionAustraliansBuilt to monitorboth physicaland intangiblegoods3 year series of dailyhistory, refreshed soonafter month endSliceand dice beyondgeography anddemographicsUsed by businesses,researchers,commentators, agencies© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 21

Establishing, managing and maintaining a datasetlike Market Blueprint ®Massive investment required to utilise transactional dataInvestment in HumansInvestment in Technology• “Exhaust data” had to be• “Bottom up” analysis requiresmanually decoded – cannot massive processing powerbe taken at face value• Pattern matching• Weighting methodology• String parsing / phonetics• Thousands of brands are1 2manually identified• Clustering / link analysis• Principal ComponentAnalysis© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 22

Establishing, managing and maintaining a datasetlike Market Blueprint ®Massive investment required to utilise transactional dataConstant monitoringFocus on accuracy• We constantly identify and • Cross check against externalcapture new online retailers sources (both public and client)• Businesses that didn’t exist • Constant manual review andin last year are now biggerverification of data codes andonline than our largest3 4retailers!automated routines© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 23

AgendaBig data and the data scientistBig data in actionBig data challenges – the journeyfrom transactions to insightsInsights on online retail© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 25

The big pictureRetail in Australiaemploys over1.2m peopleOnline retail nowrepresents a 13bnsector, or 5.8%,and is growingat 27% p.a.Many see this asa threat to thosejobs, and thebroader economyOthers see onlineas a way for Australiato demonstrateinnovation andpromote competitionand serviceEither way, astructural changeis well underwaySource:© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 26

Sales ($b)Top 15 online retailers compared to biggest department stores54.543.5Annual SalesTop 15 OnlineRetailers32.521.510.50Source: 2012 Reports and AccountsSource:Last 12 Months© 2013 The Quantium Group Pty Ltd. In Commercial Confidence27

Proportion of Retail Sales OnlineGrowing transference to the online channel8%Proportion of Retail Sales Online7%6%5%4%3%2%1%Source:0%2010 2011 2012.© 2013 The Quantium Group Pty Ltd. In Commercial Confidence28

JanFebMarAprMayJunJulAugSepOctNovDecJanFebMarAprMayJunJulAugSepOctNovDecAustralian retail : a 2 speed economy?Year on Year Retail Growth45%40%35%30%25%20%15%10%5%0%Source: ABS and2011 2012Bricks & MortarOnline© 2013 The Quantium Group Pty Ltd. In Commercial Confidence29

Proportion of Online SpendGoing OverseasOverseas online purchases – a substantial threat?Source:100%90%80%70%60%50%40%30%20%10%0%Online Spend Going OverseasBut over half of onlinefashion spend goesoverseas2010 2011 2012.© 2013 The Quantium Group Pty Ltd. In Commercial Confidence30

IndexAUD : USDInternational online accelerated when the Australian dollarreached parity350Domestic/International Sub-indices1.23001.02500.82000.61500.41000.2500.0.2010 2011 2012Domestic International USD/AUD Exchange Rate Exchange Rate ParitySource:© 2013 The Quantium Group Pty Ltd. In Commercial Confidence31

Structural change occurring in each retail category5 of the top 20 online players sellgroceries and liquor – 6% of allonline spending is on groceriesAlmost 10% of all fashionis now online, and isgrowing at 42% pa!After a slow start, ourmajor department storesare now growing their onlinearms at 112% paIn 2011, online music, movies andbooks overtook total bricks andmortar sales© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 32Source:

Indexed Transactions Online100 = 7pm November 1919:0021:0023:001:003:005:007:009:0011:0013:0015:0017:0019:0021:0023:001:003:005:007:009:0011:0013:0015:0017:0019:0021:0023:00#ClickFail? Despite technical difficulties, “Frenzy” participantsgenerated sales 2.5x more than their previous biggest day ever350Indexed Transactions Online30025020015010050-Nov 19 Nov 20 Nov 21Non-participating brands Participating brandsSource:© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 34

Online retail – threat or opportunity?© 2013 The Quantium Group Pty Ltd. In Commercial Confidence 35

Sales ($bn)JanFebMarAprMayJunJulAugSepOctNovDecJanFebMarAprMayJunJulAugSepOctNovDecJanFebMarAprMayJunJulAugSepOctNovDecJanFebUse of transactional data as a lead indicator?Total Retail30,00025,00020,00014,00012,00010,00015,0008,00010,0006,0004,0005,000ABSMarket Blueprint2,000--Source:2010 2011 2012 2013© 2013 The Quantium Group Pty Ltd. In Commercial Confidence37

“Data Scientist : The Sexiest Job of the 21st Century”“Think of big data asan epic wavegathering now,starting to crest.If you want to catch it,you need peoplewho can surf”© 2013 The Quantium Group Pty Ltd. In Commercial Confidence38

Thank youWade Tubmanwade.tubman@quantium.com.au© 2013 The Quantium Group Pty Ltd. In Commercial Confidence