Two New Data Management Systems Help Miles Kimball Get Nimble.
Miles Kimball, a multi-title catalog company in Oshkosh, Wis., has employed a two-pronged technological approach that gives it a clearer, real-time vision of the company’s front- and back-end operations. Armed with these tools, managers now can make business decisions—on everything from marketing campaigns to staff scheduling—by using data available on their own desktop computers. Managers no longer have to ask other departments such as IT for lengthy reports that often can take days to generate. Instead, a question, such as how many returns it’s getting on one particular SKU listed in the latest catalog campaign, can be answered by the merchandise manager after only a few key strokes on her computer.
“These systems have helped us to get the right data into the hands of those who need it,” says Vicki Updike, vice president of marketing at Miles Kimball, mailer of the Miles Kimball, Miles Kimball Cards and Exposures catalogs. “We’ve been able to break down the barriers of information, so those who need data have them and can make timely and accurate decisions.”
The company has employed a business performance management (BPM) system and a custom-built marketing database. Taken together, these two systems enable Miles Kimball managers to drill down to the finest grain of detail, data they then use to streamline and fine tune marketing and operational practices. That is, these two systems help them fulfill the modern-day mandate to do more in less time.
Miles Kimball shares with Target Marketing the benefits it is accruing from these systems, the challenges it faced in implementation and some of its plans for future integration.
Transparent Data at Their Fingertips
BPM systems can be used for functions such as financial budgeting and reporting, general ledger, data warehousing and other operations-related tasks. The market for such solutions grew about 20 percent in 2003, according to John Van Decker, vice president, technology research services at Meta Group. And consolidations in the market are heating up. Comshare, the company from which Miles Kimball purchased its BPM system, has since been bought by Geac, an Ontario-based enterprise software developer. Other BPM vendors include Cognos, Hyperion Solutions, Lawson Software and SAS.
A BPM system enables a company to quickly and easily roll up data and deliver them to those who need instant access to the information. This technological capability enables faster decision-making and cycle times, greater visibility and transparency of data, along with the accompanying cost savings to those functions. In short, it enables “access to a single version of the truth,” writes Tad Leahy in his article “BPM Grows Up,” which appeared in the January 2004 issue of Business Finance magazine. Users of well-structured BPM systems can go to one place to quickly get all of the accurate and highly detailed information they need to make business decisions. And that’s exactly what Miles Kimball’s managers say they like about their Geac Performance Management (Geac PM) system.
“Our decisions now can be more data-driven, as opposed to pure gut feelings,” says Doreen Carstens, vice president of creative and merchandising at Miles Kimball.
The catalog company is using the Geac PM system delivered in an application service provider (ASP, or Web-enabled) format. The staged implementation process, which began in February 2003, is almost complete. Phase one entailed giving managers daily access to analytical reports of transactional data. Phase two, which was completed last October, brought an operational and budgetary program online. According to Dana S. Gilman, vice president of product planning and analysis, each manager now can plug into the system his or her operating budget to see how it will impact all of the other areas of the business.
“For example, in [Geac PM], we can budget our orders filled per work hour, feed that information against our order forecast, and very quickly derive payroll and tax liability costs for our budget,” says Gilman.
This clear and shared view of the entire back-end operation has enabled Miles Kimball managers to make better, more informed decisions in a quicker and more streamlined fashion, she notes.
“Our budget development process, for instance, has been shortened considerably. Everyone can add their input and make changes to the budgets and then instantly see how their changes will affect all other areas of the operation,” Gilman continues. “The beauty of this system is that we can see how our assumptions about a particular catalog campaign actually did and how it impacted the entire enterprise, not just individual [departmental] financials.”
Gilman compares this instant access to actionable data to the company’s old way of gathering needed information. Before Geac PM was implemented, requesting or querying the database would put a good deal of stress on the transactional data-retrieval process, she recalls. “So we often had to run queries in the evening, and other times we would get a lot of out-of-date information, often by a month or more,” she notes. Carstens adds that even after getting the reports, they often required a good deal of manual manipulation to garner the necessary data.
Says Gilman, “But we’re in the fast-paced, direct-to-consumer business, and we needed managerial tools that enabled us to retrieve data quickly so that we could react quickly.” Now with the Geac PM system, Miles Kimball’s CEO, for example, “can take a quick glimpse and see how our strategies actually are impacting the entire operation,” she says. Plus, Gilman continues, the data are offered up to managers’ desktops “in a graphical, colorful format that’s very intuitive and easy to understand.”
The third and final phase of the Geac PM implementation, which was still ongoing as of March, will bring a strategy module online. Once that portion of the program is operational, Gilman says, managers will be able to devise specific operational tactics and assign responsibility for achieving those goals. Performance then can be tracked through the Geac PM program.
To clarify, Gilman offers the following example: “Say we have 50 percent of orders coming in via the Web. We can design tactics and actions, such as e-mail campaigns or affiliate programs, around [the goal of] increasing Web sales. A measurement of each action item and tactic will be set, and actual performance tracked [in Geac PM] against the target. Overall performance toward the stated strategic goal also will be tracked, as well as the individual tactics.”
This data-driven process, Gilman continues, will help Miles Kimball managers identify why they’re missing or hitting their overall strategic goals.
How They Are Using the Data
Currently, Carstens and the merchants use Geac PM to see, for instance, the reason codes for a particular product’s returns made within a specified time frame. Armed with these data points, they then can follow up with the product’s supplier or use instead the company’s creative or merchandising operations to resolve the problem.
“I could still get the necessary information before,” says Carstens, “but I would have to find the right business analyst, and then ask for a lot of reports that may take days or weeks to generate. Now I can accomplish these tasks instantaneously from my own desk; all the necessary data is right there. As a result, I can make more timely and strategic decisions about our products.”
Carstens says such returns data are available at the SKU, classification, category or even campaign level. “The system helps us guarantee that we’re meeting our pledge to customers, to be sure we haven’t fallen short of their expectations,” she continues.
Geac PM also allows the management staff to view entire catalog campaigns at a glance. With only a few keystrokes, Carstens says, she sees in real time how customers are responding to a particular catalog mailing, which helps her to make strategic forecasting and budgeting decisions.
Cost and Challenges
Gilman says the company spent less than $300,000 to implement the Geac PM system, including training from Comshare consultants. Most of the staff training occurred in-house, she says, although a few employees went to Chicago for specific classes.
The greatest implementation challenge, she notes, involved data validation. “We wanted that part of it to be seamless and reliable, and it was tough to do,” she recalls. The difficulty lay in extracting data accurately from Miles Kimball’s order processing for import into the Geac PM system.
“We would build what we thought were solid business rules for data extraction and then learn that, for a variety of exceptions, the extraction would miss data, or the data would change,” Gilman explains. Achieving accurate data extraction was a time-consuming, but necessary, task in setting up a BPM system, she adds.
Gilman cautions others thinking about a BPM system to get cross-functional people involved early in the planning stages. “Have them identify their business-process needs upfront,” she says. “It’s much easier than trying to incorporate their needs later in the process.”
That’s the same sage advice Marketing Vice President Vicki Updike offers regarding the database her department recently installed.
More Accurate Marketing Forecasts
While Geac PM views data from the product/campaign summary level, Miles Kimball’s new relational marketing database views customer data and transaction detail specifically. The database is a custom-built solution from CSC Advanced Database Solutions, which recently was purchased by DoubleClick.
“[The database] shows us, for example, how many catalogs an individual was mailed between purchases, how many items were ordered, how many of those items were on sale, how many were bought through a special promotion and much more,” says Updike. “It’s a much ‘cleaner’ database environment, and it enables us to forecast much more accurately than we could previously.” Currently, all marketing and merchandising analysts use the database.
The goal for the system was to use better data to make decisions, says Updike. “And we’re seeing that. For example, we can slice and dice lifetime value statistics from every conceivable angle. From source codes, we can see which catalog first brought a customer in, and we can see who is a more valuable Miles Kimball customer over a lifetime. These data are helping us to focus our prospecting efforts and to develop smart sequencing of customer contacts.”
Updike says the system also has enhanced her department’s ability to model and segment its customer lists. This, in turn, has helped Miles Kimball improve its profitability on catalog mailings by enabling better name selection. The key, she says, was learning how to use the data available. “For example, the name-selection tool allows fast selection and extraction of buyer-file segments, and it quickly generates accurate count estimates,” says Updike. “Name selection easily can use variables that go down to the finest level of purchase data, enabling the development of customized segments.”
A Streamlined Workflow
Updike says the catalog’s technology investments have greatly streamlined the data-reporting process. “Before we implemented the marketing database, marketing would request a report from IT. It would then take a few days to get it back. Then we’d have to use Excel to complete the information needed.”
She offers another example of how cumbersome previous data reporting had become: “To run a campaign report to marketing contributions level, we would have to download sales data from our Ecometry system, tie it to a promotional table or a merge/purge report in Excel, look at cost of goods sold … it was a labor-intensive process.”
But with the new database, she says, queries are automated, and a marketing analyst can look at all the data right from his or her own desktop. “The people who use the data are those who can pull it directly,” she notes. “They have easy access to the information they need. It puts the data directly into the hands of those who use it. No extra people or departments are needed. Plus, we can continue to drill down to get the data we really need. We can explore the data at a much finer level of detail than before.”
After examining the data, she says, the marketing and merchandising teams then can perform various types of analyses, such as segment, category and square inch, which, in turn, has helped drive both merchandising and circulation plans, Updike continues.
The data also help drive e-commerce decisions, such as to whom to send e-mail offers and when, and what products to feature on the cataloger’s landing pages. Indeed, the marketing database has helped the company fine tune its overall multichannel marketing initiatives, says Updike.
“Of course, having all of this data can be a bit overwhelming,” Updike concedes. “But we have so much more flexibility than we had before.”
Next Up: Integration Mode
Updike says that someday Miles Kimball will combine the Geac PM system and the marketing database. “We like where the database is today, but we still plan for additional functionality in the future,” Updike notes. “We see the database as an evolving tool with future enhancements such as daily data updates, Web data integration and the automated generation of modeling data sets.”
Updike advises other marketers embarking on a major technology upgrade to first undertake an in-depth needs analysis. “When we did that, we found that some [functions] would be nice to have but not really necessary to the operation or impactful on marketing decisions.”
Next, send a request for proposals to vendors and examine the incoming proposals very carefully and cautiously. “Be sure that thorough training of your team is part of the package,” Updike advises.
Finally, be sure the query and reporting tools are robust and intuitive. “If the tools are too generic, you’ll quickly outgrow them,” she notes.
Earlier this year, Miles Kimball’s parent company, Blyth Inc., bought the Walter Drake and Home Marketplace catalogs and is handing over some of their operations to the Miles Kimball management team. Updike says the integration is going very well. “We should be fulfilling Walter Drake and Home Marketplace orders out of Oshkosh by May 1,” she notes. “So the timing of our technology upgrades is perfect, given the timeline of this acquisition. We’ve learned how to use the tools, and we know how the data can be used to drive sales.”
That is, the Miles Kimball team is using technology to do more in less time.