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Yakult, the probiotic drink manufacturer, has boosted its sales by up to 20% by using sophisticated analytics and data visualisation tools to understand its customers’ buying habits.
The company has seen its sales grow by between 15% and 20% in the Netherlands, after analysing a wide range of public and private data to identify how it can sell products more effectively in the country’s supermarkets.
Yakult’s business in Holland relies on one product – a fermented milk drink containing bacteria, which is bought by health-conscious consumers.
The drink was developed in Japan in the 1930s and is now sold in 33 countries through a network of “Yakult ladies” who deliver the product door-to-door in Asia and through supermarkets in the west.
Yakult, which reported worldwide sales of $3bn in 2015, began to face serious competition when rival Dannon introduced its own probiotic products in 2004.
Rather than losing market share, Yakult discovered that sales of both products grew, and the company wanted to know why.
“It seemed like there was synergy between competitors,” Egbert Jan Vierkant, market analyst at Yakult in the Netherlands, tells Computer Weekly.
At that point, Yakult lacked the information to understand how the market was changing. Company data was fragmented and often stored by people on their own personal spreadsheets.
Yakult responded by doubling its research budgets and hiring market analysts to better understand market dynamics.
He was about to buy them when he had visit from a Spotfire sales representative offering an analytics package that did not need complex programming and was able to display results graphically. “It was so intuitive, I felt like we had come home,” says Jan Vierkant.
“You don’t have to think of a strategy, you just do it because it is fast. Compared with Microsoft Excel, it is 500 times faster – you can create graphs in seconds.”
Waiting for the cloud
Jan Vierkant opted to wait for the software to become available as a cloud service before presenting a business case to the board.
It wasn’t so much a business case, but a live demonstration, in which board members asked questions and Jan Veirkant produced answers on the fly.
“I was like a Japanese cook, producing food while the diners are eating it,” he says, referring to the many Japanese Teppanyaki restaurants in Holland.
The deal was sealed when he told the board that the cost of setting up the software was practically zero – only a couple of thousand pounds.
Data increases sales
Yakult is now using the software, currently owned by the US technology company Tibco, to show supermarkets how they can increase their sales of Yakult and other probiotic products.
“In our product category, there are 100 to 150 products and they all compete for the same shelf space. It’s our challenge as Yakult to have more knowledge than the retailer about how they can maximise sales,” he says.
The company is able to produce a graphic for each supermarket showing the sales performance of its own and rival probiotic products, including turnover per cm of shelf space, on a single piece of paper.
“You can summarise a total product category on one sheet, instead of having to wade through hundreds of pages of data,” he says.
Yakult’s analysts are able to give the retailers access to the data, let them look at trends and perform analysis on the spot, allowing them to experiment with different configurations on their shelves.
Insight into buying habits
Yakult’s biggest success so far has been to use Spotfire to persuade supermarkets that they would sell more products overall by stocking 15-bottle packs of Yakult alongside the normal seven-bottle packs.
“We found out that the 15 pack had a different target customer than the seven pack,” says Jan Vierkant.
The analysis showed that elderly people with fewer than two people per household were heavy users of Yakult.
But while women often buy Yakult, the statistics also showed that men were buying the larger pack size. “We never expected that. We only found that out by tracking the data.”
Jan Vierkant and his colleagues are feeding a wide range of data into Spotfire to identify trends.
They include commercial brand tracking research, orders from retailers, data about the weather, advertising campaigns, data from Google searches, the number of visits to the Yakult website and analysis of stories in the press about Yakult.
The software holds 20 million pieces of data, made up of 500,000 records, in 40 data fields.
“It would take years to go through this amount of data with Excel, but with Spotfire you can play around and just spot things because of the speed and visualisation,” says Jan Vierkant.
“Without Spotfire, it would have taken us much longer to attain that 20% growth”
Egbert Jan Vierkant, Yakult
The analysis helped Yakult to work out why its summer advertising campaigns in the Netherlands were not lifting sales.
“We thought the advert was not good enough or that people were drinking less in the summer because it was hotter,” says Jan Vierkant.
The answer turned out to be much simpler: Sales fell when people went on holiday, but went up again when they returned.
Data through devices
Jan Vierkant uses the software, which is updated with new data every four weeks, to create reports of marketing, sales and public relations staff, in the Netherlands, Germany and Belgium.
The next step is to make data from Spotfire more widely available through mobile phones and tablets.
Yakult is evaluating the potential at Tibco’s Jaspersoft software to provide simple dashboards to managers that could show how sales are performing against targets, for example.
“Without Spotfire, it would have taken us much longer to attain that 20% growth,” says Jan Vierkant.