Mysupermarket - Building a Business of Data Warehousing Foundations

Topics: Data management, Data mining, Customer relationship management Pages: 12 (3363 words) Published: February 16, 2011
BUILDING A BUSINESS MODEL ON DATA WAREHOUSING FOUNDATIONS:

Executive Summary

mySupermarket is a grocery shopping and comparison website which aims to provide customers with the best price for their shopping. This report examines how data warehousing provided mySupermarket with the foundation in which to build a successful enterprise, and allowed a subsequent expansion into the ‘business intelligence’ sector. The research draws attention to the problems and limitations that mySupermarket encountered including; coping with diverse sources of data streams, customer loyalty issues, achieving real-time data, data integrity and generating a sustainable revenue stream. These problems were tackled respectively through; building their own data warehouse, adopting a CRM strategy underpinned by their warehouse, adopting Microsoft’s SQL software, supermarket website ‘crawling’, offering ‘targeted’ advertising space and the realisation that the granularity of detail they offered, would allow them to expand into the ‘business intelligence’ sector.

The report appreciates the importance of storing data, but concludes that data itself is the prerequisite to success, and that good management is needed to convert this data into meaningful information. It is therefore a combination of data warehousing and good management that has enabled mySupermarket to become a successful venture.

Introduction

“On the 31st August 2006, entrepreneur Johnny Stern received a seven-figure sum from investors to transform the way consumers shop for their groceries. From this, the price comparison site mySupermarket.co.uk was born and the company has utilised data warehousing to give consumers access to cheaper grocery shopping. The venture has not been without its problems, however four years on the company has withstood Adam Smith’s ‘Invisible Hand’[1] and grown into a c.£10m company...”

mySupermarket is a grocery shopping and comparison site that allows customers to compare and shop from four main UK supermarkets in one central place. Their mission statement is “to get the best possible price for your supermarket trolley while enjoying an easier and more consumer-friendly shopping experience”. Through the use of SQL and data warehousing, mySupermarket is able to collect product pricing, promotion and availability data directly from retailers' websites. It then uses its proprietary technology to match identical Stock Keeping Units (SKUs) across retailers. After initial investment from Greylock Partners and Pitango Venture Capital (investors in Facebook & LinkedIn), mySupermarket have faced the same difficulties as other price comparison sites in generating a sustainable revenue stream after Stern declared that “the portal would remain free in principle for shoppers”.

The customer proposition for mySupermarket is to first log into their account. Then choose which supermarket to shop at from; Asda, Ocado/Waitrose, Sainsbury or Tesco. Tick their preferred supermarket and choose a delivery time/date, then start to shop. mySupermarket is updated on a daily basis so that the prices shown are the most competitive. Once the customer has made their choice of store, they start to shop by using the tabbed choices along the top of the page. These are divided up into "virtual aisles" so making a choice from Fruit and Veg, Meat, Fish & Poultry, or Drinks etc. Once shopping has been completed, it then shows basket prices across the four supermarkets and allows the customer an opportunity to switch supermarkets.

This report will critically discuss how data warehousing has enabled mySupermarket to build a successful business model including the benefits and problems that have arisen from the use of this technology. The report will finally analyse the extent to which data warehousing has contributed to mySupermarket’s success.

Technologies Discussed

According to Bill Inmon[2] (1993) data warehousing can be defined as, “a...

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[1] A term coined by Adam Smith in his first book ‘The Theory of Moral Sentiments’ (1959)
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