In a recent conversation with a chief technology officer, he asserted all digital technology changes in his organisation were being led by IT and not by marketing. It made me wonder: How long a marketing function like this could survive?
Magazine distributor, Gordon and Gotch Australia, has tapped into IBM’s Predictive Analytics technology to provide more accurate print allocations and recommendations and improve sales for its customers.
The company is using the technology across its historical sales data to model demand planning and forecasting, and to allocate how many copies of each title and issue should be allocated to each retail outlet. It’s also now able to provide clients with better insights into sales performance.
Gordon and Gotch, which has been operating since 1853, distributes more than 130 million magazine copies annually. Thanks to IBM’s technology, 65 per cent of titles are now being automatically allocated, leaving more time and capability to analyse sales performance, measure marketing activity effectiveness and making recommendations to clients for future growth, the company said in a statement.
General manager, David Hogan, said its historical data sets included a catalogue of every copy of every publication delivered and returned to retailers over many years, making it a valuable source of information. However, the key was to turn this into actionable insights. Previously, analysts had to manually assess information, which was very time- consuming.
“Distribution is not just about efficient logistics, it’s about being smarter about the magazines that publishers print and where retailers sell them,” he commented. “We wanted to show our clients that we could use the goldmine of data we had to change the way distributors are perceived in the industry and optimise sales with more intelligent allocations.”
Gordon and Gotch worked with IBM channel partner, Cornerstone, to implement IBM technology as an analytics platform, incorporating predictive modelling, data from multiple sources and produces base forecasts. The IBM analytics solutions deployed are SPSS Modeller as the predictive demand planning tool, TM1 as the allocations tool and Cognos Business Intelligence as the data visualisation and analysis tool.
Phase one of the platform went live in September 2014. The company said further phases are being planned covering a wider number of areas across the business with phase two currently in the development stage.
“We decided to build a solution that would integrate with modern analytics tools to provide a much more powerful and flexible way of forecasting sales and allocating copies,” said Poppy Stamateas, head of IT and business systems at Gordon and Gotch. “When we first launched the new allocations solution, we were hoping for at least 50 per cent of titles/issues to have their allocations automatically finalised. In fact, the actual result was 65 to 70 per cent.”
The companies told CMO business stakeholders came up with the idea behind the analytics overhaul, based on the need to replace an ageing and inflexible technology landscape and a desire to provide clients with more accurate allocations, print recommendations and greater insights into sales performance.
Cornerstone director, Piers Wilson, said IBM Cognos has traditionally been used by finance teams for budgeting and forecasting.
“The analytics solution we have architected at Gordon and Gotch is quite different. It’s a very innovative operational solution that combines business intelligence and predictive analytics to optimise sales for the customer,” he said.
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