• Retail

Successful Business Intelligence project implementation at M.video

About the Customer

OJSC “Company “M.video” (www.mvideo.ru) is one of the leading Russian consumer electronic retail chains, first and the only public company in its segment. The Company started its operations in 1993 and by the end of third quarter of 2008 it had 140 brand name stores in 59 Russian cities with a total space of 375 000 sq. m. In 2007 “M.video” was awarded as “Best Retail Company” by prestigious Russian “Number 1 Brand/People’s Choice Bran” dnational competition.
In November 2007 OJSC “Company “M.video” became the first publicly traded company in the domestic consumer electronic retail sector.

Goal of the Project

By the beginning of the project there were several informational systems that M.video used for getting reports. It was the reason of big costs related to their support and further development. Big amount of this systems couldn’t fully satisfy the needs of fast developing company. Besides, none of the systems could support Web technologies and therefore couldn’t provide a simple and fast access to reports for different users from the stores.

M.video needed an informational system that would provide completion of following tasks:

• Consolidation of all information in one unified data warehouse
• Providing all users with access to requested information depending on their needs and tasks and providing them with appropriate tools that would help to resolve all occurring analytical tasks of any complexity
• Providing users from the stores with access to corporate information analytical system
• Effective information support of analytical and forecasting business processes
• Reduction of exploitation laboriousness and maintenance of corporate analytical system through existent software unification and significant decrease of time needed for modifications

Solution

As a strategy for choosing components of information analytical system M.video set Best-of-breed principles – to launch best in its area solution for every functional area. Selection principles were defined by following criterias:

• System should be able to process huge amount of data up to transactional data
• System should support simultaneous work for hundreds of users, including users from central office and stores
• System should be able to use complex analysis methods which are necessary for retail business

Sybase IQ was chosen for building data warehouse as it was specially designed for analytical data warehouses; Oracle Data Integrator (Oracle|Sunopsis) was chosen as data integration tool, which is rather new data download tool - ELT (Extract Load Transform.) MicroStrategy platform was chosen for reporting and data analysis as it helps to complete such important retail tasks as ABC analysis, market basket analysis, etc.

S&T Russia was chosen as a main executor for creating data warehouse as it specializes in developing data warehouses in big companies and has unique for Russia expertise in implementing mentioned products.

Results

Data warehouse creation at M.video was divided into several phases. On every phase range of downloaded data was increased and solutions for typical business tasks based on this data were worked out. On the first stage of data warehouse creation (it was completed in December, 2006) following data was downloaded to the warehouse:

• Retail sales
• Sales plans
• Payments for retail sales

As a result, business users got an opportunity to monitor plans’ completion. Plan completion report was emailed before to directors of the stores, which requested a lot of efforts from analytical department employees. Now director of the store can get this information at any moment using MicroStrategy Web client. Moreover, director of the store can analyze this data using options of data sorting, rotation, drilling and calculation of totals and subtotals.

Financial department employees that work with data stored in SAP BW got a simple tool for creating their own reports. This reports can also be analyzed through MicroStrategy tools: sorting, rotation, detailed elaboration and remote access via Internet.

On the second stage of Business Intelligence system creation data warehouse was fulfilled with following data:

• Wholesale sales
• Marketing activities
• Extended service programs
• Activation of gift certificates
• Goods’ categories
• Sets

Moreover, following analytical methods were worked out:

• Leasing programs
• Sales using savings discount cards
• Marketing actions analysis
• Market basket analysis

M.video got the system for corporate reporting and data analysis that became a source of accurate, coordinated and reliable data about company’s activity. Now company got an opportunity for regular monitoring and efficiency analysis from different points of view, different levels, financial and nonfinancial indicators:

• M.video got available through Web corporate reporting system that replaced several older systems
• The speed of receiving data by employees increased significantly. Analytic had to wait for getting needed data for hours before and now this process takes just several seconds
• Users got an opportunity of creating own reports based on unified business terms reference book without participation of IT department
• Company got an opportunity to complete more complex tasks easily

“Business Intelligence solution that was developed by S&T International provides M.video employees with an option to track key company efficiency indicators and resolve complex analytical tasks related to exposure of dependencies between selling goods, assortment optimization, marketing actions analysis, leasing sales, sales through discount cards, sales with additional services, with some sets, etc. We are satisfied with implementation of two phases of information analytical system creation and together with S&T Russia we plan to expand the functionality of our data warehouse fulfilling it with additional data” – commented M.video CIO Georges Correa.

S&T Managing Director Valery Dutchak said: “I am happy that S&T Russia has another successful project and grateful for a fruitful cooperation with M.video. I would like to thank customer’s project team and especially Sergey Kholmanskikh and Andrey Popkov for professional project management. I am convinced that next steps of BI project will go just as smoothly as previous ones.”