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Responding to maketplace competition to increase its knowledge of customer behavior, eBay Inc. recently chose Business Objects’ e-business intelligence (e-BI) software and customer insight applications as its clickstream analysis solution. eBay, the leading online personal trading company, purchased Business Objects’ full suite of applications, including Web Intelligence (a business intelligence tool for the Internet) and Set Analyzer (a set-based analysis tool). With more than 1.5 billion page views per month and more than four million items for sale, eBay will use these tools to analyze its vast amount of data and make improvements that will benefit the online auction community.
Discussing his decision to go with Business Objects, Bob Sanguedolce, CIO of eBay, says, “We operate in a very competitive marketplace and it is important that we continually improve the experience for our community of buyers and sellers.” Timo Elliott, senior director of Web intelligence and product marketing for Business Objects, states that the key reason eBay chose his company was its Set Analyzer tool, which will let eBay perform deep segmentation of its customer base. Most dot-commers have accumulated vast amounts of clickstream data, but they trail traditional brick-and-mortar companies in data analysis and warehousing.
According to Business Objects, Set Analyzer’s unique attributes, such as visual selection of data sets and set-based analysis, will provide eBay with a tool for understanding its customers and shaping its marketing initiatives accordingly. Elliott thinks that dot-commers have the advantage of clickstream analysis, which he believes will be the new standard for large-volume data analysis, in the same way that Wal-Mart’s point-of-sale data analysis sets the standard for traditional retail companies. For example, while a brick-and-mortar company can determine that a customer purchased a loaf of bread, a dot- commer can access details such as what
other items the customer almost purchased. The company can analyze the data to determine why customers did not buy the other items, such as shipping costs were too high, they found a more interesting item, and so on. The company can then create strategies for improving the site or target promotions for specific customers.
Traditional retail companies have long understood the value of data analysis, while the emerging dot-commers have concentrated on building their companies. As they become more established, dot-commers are realizing the strategic value of understanding their customers and improving their relationships with suppliers and affiliates. Elliott notes that although most dot-commers are technically savvy, they are less familiar with data warehouses and database analysis. They do not have the infrastructure and expertise that most brick-and-mortar companies do. Dot-commers are more likely to prefer having outside help in installing and setting up these systems. However, they are also not burdened with legacy systems like traditional retail companies, making dot-commers more flexible in trying new technology.
Bernard Liautaud, president and CEO of Business Objects, believes, “Internet industry leaders like eBay represent the next generation of businesses that will benefit from e-BI technology. Defined as the convergence of business intelligence and the Internet, e-BI has delivered considerable value to brick-and-mortar companies that want to connect more tightly with their customers and business partners. Now, as leading Internet companies like eBay discover the power of e-BI, they create an entirely new level of value for their network of visitors and business partners.”
— Michelle Nichols
Continued in News and Analysis Part II >>>
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In Brief
- Brio Technology Inc. has joined forces with Breakaway Solutions Inc., an e-business application services provider (ASP), to offer a hosted site for customers seeking to deploy Brio.Portal solutions and Brio technology for sharing analytic information among business partners.
- Merant has bolstered its Egility application change-management solution for Oracle environments by adding ERP change-management technology obtained through its recent acquisition of Trillium Software Corp. Merant will distribute its new PVCS ERP Change Manager for Oracle with Egility.
- Business Objects has taken steps to acquire Canadian firm OLAP@Work, a developer of online analytic processing tools for Microsoft SQL Server 7.0 OLAP Services, in a cash transaction valued at about $15 million. Business Objects will continue to market and support OLAP@Work products and will also integrate the OLAP@Work technology into its own business intelligence offerings.
- Andersen Consulting and Microsoft Corp. have announced plans to form a joint venture company called Avanade, which will provide Internet and enterprise technical services for the Windows 2000 operating environment. The Seattle-based Avanade will offer consulting services for e-commerce, Web infrastructures, and data centers.
- Volkswagen AG has partnered with IBM, I2 Technologies, and Ariba to build a global digital marketplace where the automaker can order manufacturing parts, tools, and office equipment over the Internet. Volkswagen envisions cutting costs and improving its global supply chain efficiency with the new e-market and hopes its online clearinghouse will be adopted as the European standard instead of a competing U.S. Internet alliance recently launched by General Motors, Ford, and DaimlerChrysler.
- Ericsson, Motorola, and Nokia have forged an alliance to develop an open and common industry framework for secure mobile electronic transactions. The mobile e-business initiative uses Wireless Application Protocol (WAP) security technologies.
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