Data migration hits sales after DVD firms merge

DVD rental company Lovefilm suffered significant disruption to its customer services and a knock-on loss of sales when it consolidated onto a single platform following its merger with Video Island earlier this year, Computer Weekly has learned.

DVD rental company Lovefilm suffered significant disruption to its customer services and a knock-on loss of sales when it consolidated onto a single platform following its merger with Video Island earlier this year, Computer Weekly has learned.

The migration of Video Island's 200,000-strong customer database onto Lovefilm's own proprietary database of the same size was the key integration challenge posed by the link-up, which is among Europe's largest e-commerce mergers. However, the project ran into problems which affected online customer sign-ups and cancellations.

The consolidation programme started in April when the merger agreement between Lovefilm and Video Island was signed. Between them, the companies' warehouses receive and dispatch more than 100,000 packages every day.

Lovefilm's chief operating officer William Reeve said, "There is something inherently terrifying when you are moving several hundred thousand customers' data from one schema to another.

"We have had less website time. That has meant less sign-up activity and fewer sales. I would characterise it as a dent in our growth rather than lost sales."

The new company, which trades under the name Lovefilm, completed the consolidation of its customer records last month.

During the migration, the contact centre was unable to access customer records and so could not answer customer queries.

The consolidated platform successfully processed changes to customer records, but contact centre staff could not tell customers that changes had been made because they were accessing replicas of the customer-record database, which was not consistently updating.

Reeve said, "There have been periods where they have not had access to the replicas for people's data. We were not as quick at answering e-mails so we were slow in getting back to customers."

He added that the customer representatives had now cleared October's backlog of queries.

The two rental companies had combined sales of £25m last year. The target for the combined company in 2006 is £50m.

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