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CASE STUDY - Enhancing the Customer Experience and Improving Retention Using Powerful Data Warehousing Appliances

Commentary by Brent Buelo, Manager of Data Warehouse Services, Ahold
Customer Profile

Ahold operates 800 supermarkets in the U.S. under brands such as Stop & Shop, Giant Food, and Tops Markets, and is a division of Netherlands-based Royal Ahold, the world’s third-largest food retailer. Ahold performs advanced analytics for crucial insights into shoppers’ buying patterns, and views its customer data warehouse (CDW) as central to the way it manages product availability and ensures customer satisfaction.

Business Challenge

Ahold’s legacy data warehouse system could not keep pace with growing data volumes and query complexity. Essential reports often took days to execute, making drill-down analysis impractical, and many ad hoc requests were impossible to fulfill. With data growing exponentially, Ahold needed a system able to query terabytes of sales and operational data, and deliver fast, comprehensive results.

Netezza Architecture Breaks Down Previous Barriers

Ahold chose the Netezza Performance Server data warehouse appliance because of its ability to analyze millions of customer purchases faster and with greater flexibility than any other option in the market. The NPS system integrates database, server, and storage into one system designed specifically for high-volume, complex analytics at a low total cost. The Netezza architecture also eliminates the need for tuning, indexing, data partitioning, or aggregation required by other systems.

“We chose the NPS data warehouse appliance because it delivers the increase in performance we wanted without reengineering our entire CDW,” explains Al Clevenger, director of data management and data warehouse services, Ahold. “Now we can achieve results in minutes instead of hours, eliminating stale data and enabling us to be even more flexible and targeted with our decisions. The system was also two-thirds the cost of our previous customer data warehouse, including ongoing support and maintenance.”

Market Basket Analysis

Operational Simplicity, Low TCO

Ahold was able to take advantage of Netezza performance without reengineering its CDW—usually a costly, time-consuming project when migrating to new data warehouse systems. The simplicity of the Netezza appliance made it easy to deploy, integrating seamlessly with existing business intelligence applications and ETL infrastructure. The low purchase price is complemented by minimal ongoing maintenance, enabling Ahold to reduce DBA commitment from more than two full-time staff members to less than half of one person’s time.

Results: Digging Deeper, Working Faster, Understanding More

By boosting performance by orders of magnitude, the Netezza architecture allows Ahold’s merchandising teams to perform much faster, more sophisticated analyses of customer buying patterns. For example, one complex query that previously took 72 hours was completed in four hours using the Netezza appliance. Ahold is now running 133 percent as many analyst reports by nearly 20 percent more users, and overall productivity has increased so far by 25 percent.

The system’s speed and simplicity also allows Ahold to go much deeper into its data with more iterative analyses, and to understand customers in a much more comprehensive way. Users are no longer constrained by system limitations, and are realizing what can be gained from their data when results return in seconds or minutes rather than hours, days, or sometimes never. As a result, Ahold is able to use in-depth analysis of purchasing trends to continually enhance the customer experience, with optimized store layouts, closely targeted sales promotions, and streamlined inventory management.

With Netezza, Ahold Now Understands its Customers in a Much More Comprehensive Way

By replacing its traditional data warehouse with the Netezza Performance Server data warehouse appliance, Ahold has a data warehouse system with the processing power and flexibility to fully leverage the detailed data it collects about its customers. With query times reduced dramatically, Ahold is able to continually innovate and fine-tune its analyses by asking complex questions that were previously out of reach. The result: better-informed decisions and a leadership position in the food retail industry—with increased sales, lower costs, and greater customer retention.

This article originally appeared in the issue of .

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