Data warehousing applications are set for a major boost as more companies evolve into ebusinesses with the need to analyse the high volumes of date they?'collecting.
The technology was renamed 'analytics applications' at the first Informatica user group conference, to give it a fresh sheen for its role in the brave new world of ecommerce.
"Ebusiness is the number one driver of data warehousing opportunities. It [data warehousing] provides better and more refined customer understanding," said analyst Michael Schroeck, partner at Pricewaterhousecoopers, at the event.
Getting the message
The message at Informatique was that very few businesses are fully exploiting their data, and risk losing out to competitors if they don't use analytic applications to harness the information gathered.
't successfully implement an ebusiness strategy without data warehousing," said Schroeck.
This is because a successful ebusiness must offer customers personalisation and true one-to-one marketing in real time, but the huge volume of data generated is overwhelming.
According to James Markarian, senior product architect at Informatica, leading Internet company Yahoo has to cope with 400Gb of data every day, including data that is gathered from customers and the company responding back to them.
"The amount of information on a ebusiness site is enormous," explained Gaurav Dhillon, co-founder and chief executive of Informatica. "It includes customer information, product information and Web traffic statistics. The company is always online, the firehouse is always producing information."
Implementing analytics allows the ebusiness to provide the one-to-one and interactive experience so encouraged by industry analysts.
Traditionally, data warehousing brings together data from disparate systems and sources. An ebusiness constantly gathering customer data can combine data gathered online, offline and in a call centre to reach the one-to-one goal.
Dhillon added that the current use of analytics is quite basic, often only being used to track Web traffic. But companies also need to know who their customers are and what products they buy, to predict which others they are likely to buy, and to tie this together with ERP and mainframe information to ensure they have the inventory to meet demand.
The technology not only allows the supplier to identify its most profitable customers and provide them with a premium service; it also brings the two closer together.
"There's little point in obtaining customer information if it isn't pushed out to operations workers," explained Schroeck. "An airline gathers lots of customer information, but if that isn't at the customer touchpoints - in this case, the check-in desk - then it's optimised.
An ebusiness can also use analytics to drive their customer base to its most profitable channel. A bank can save huge transaction costs through online banking, for example.
One reason so few ebusinesses have embraced data warehousing, or analytics, is the fast pace of the industry, believes Schroeck.
"Few companies have taken the time to support analytics because the early entrants are running so fast to keep up with the competition, they can't analyse information. But over time they won't survive - they'll lose customers," he said.
Information on the move
Analytics also helps bricks and mortar companies evolve into 'clicks and mortar' businesses. One company is 150-year-old medical and surgical supplier Owens and Minor, which used Informatica to build a data warehouse and extract that data to build an extranet.
"We are traditionally known as a box shifter," said Don Stoller, director of Owens and Minor. "But by closely connecting with our trading partners, by giving our suppliers and hospitals access to information, we're becoming known as an information mover."
Stoller added that his company's revenues have increased because it can now charge for that access while attracting new customers. "It's bringing new business to our organisation while solidifying our existing organisation," he said.
According to Colin White, principal consultant at Database Associates International, this increased interest in data warehousing will drive more interest in pre-packaged, customisable solutions, as ebusinesses have to do all their decision processing 'on the go' and so have no time to build their own solutions.
Analytics in the UK
While Informatica customers in the US include a wide range of industries, from retail, surgical supplies, networking with Cisco as well as Internet companies Inktomi and priceline.com, in the UK it's the high tech companies that have first woken up to analytics, said Dhillon.
"Businesses in Europe are still wary that ecommerce will cannibalise their existing business or just won't be profitable, but high tech suppliers Mercury, One2One and BSkyB see the vision," he said.
However, Informatica is confident that analytics will soon become mission critical. Just as corporates today rely on networking with Cisco, operating systems from Microsoft, databases from Oracle and ERP from Peoplesoft and SAP, they will soon need analytics in the same way, said Dhillon.
Informatica is expanding its core technology to better serve ebusinesses after its traditional data integration products, Powermart and Powercenter, were adopted by Internet companies.
It will also launch a 'one stop Web shop' for the Informatica community. Called the Business Insight Portal, customers will be able to purchase online everything from Informatica clothing to software licenses and simple components.
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