How Amazon uses Big Data to transform operations
More companies than ever before are leveraging data and using it as a tool to monitor and track the latest trends in customer behaviour.
Ultimately, data allows companies to make better decisions and increase efficiency. In February’s edition of Supply Chain Digital, we looked at three global heavyweights, Amazon, Starbucks and American Express and observed how they introduced Big Data into operations. In this article, Supply Chain Digital takes a closer look at Amazon's Big Data drive.
One of the biggest ways that Amazon utilises data is through its recommendation engine. When a customer searches for a particular item, this enables Amazon to better predict what else that customer might be interested in. Subsequently, this enables Amazon to streamline the process of persuading a customer to purchase it. Its personalised recommendation system is thought to account for 35% of the company’s annual sales.
And it doesn’t stop there. Amazon gathers individual data on each and every one of its customers while they use the website. In addition to what a customer buys, Amazon observes the items looked at, shipping address and whether a customer leaves reviews. Big Data has helped propel Amazon to the top of the e-commerce pile. The company links with manufacturers and tracks their inventory to ensure orders are fulfilled quickly. Through Big Data, it allows the warehouse closest to the customer to be selected and shipping costs to be considerably reduced by 10-40%. With Amazon’s grip on the field showing no signs of slowing, data and the ways it’s used is more important to the long-term future of companies than ever before, or run the very real risk of falling behind to competitors.
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Grupo Espinosa: 70 years of constant evolution
Founded in 1952, Grupo Espinosa has been relentlessly supporting the publishing industry with producing more than 100 million copies every year – whether its books, magazines, catalogues or single-order custom prints. No project is big or small for Grupo Espinosa, as the facility can scale up on demand and their turnaround times are highly competitive. Grupo Espinosa works with on-demand digital press or offset press, in paperback with glued softcover binding, PUR softcover binding, stitched paperback binding, binder’s board, hardcover, saddle stitched, Spiral or Wire-O. Equipped with the experience needed for a product to leave the plant ready for distribution, Grupo Espinosa delivers anywhere inside or outside Mexico. Traditionally starting off as a black and white printing press, Grupo Espinosa has experienced transformation first hand – from colour to digital offset printing. Currently, Grupo Espinosa is also looking at making capital investments into audio books to match with the increasing demand.
So how did a seemingly local operation in Latin America become a world-renowned printing facility trusted by hundreds of clients? As Rogelio Tirado, CFO of Grupo Espinosa for the last six years says “It all comes down to our market experience and our dedication to quality”. With nearly 70 years behind them, and located in Mexico City, Grupo Espinosa has two major locations – one spanning 75,000 square metres and the other about 45,000 square metres. Both locations are controlled by a single ERP (Enterprise Resource Planning) system ensuring speed, consistency and quality of work. Tirado says this isn’t their only competitive advantage. He adds “Our competitive advantage is the relationship we have with customers and the trust they put in us with their intellectual property”. Speaking of trust, global publishing giant Macmillan Education exclusively partners with Grupo Espinosa for their Latin America operations, as part of Macmillan’s decentralized hub strategy. Having a facility that offered the full spectrum of service – from storing digital content to printing and distributing – was one of the major requirements for Macmillan, and Grupo Espinosa was recognized as the leading printing hub for providing this 360 infrastructure. Another factor that has led to success for Grupo Espinosa is the absolute focus on quality and time. The staff are committed to providing the best quality in the best possible time, without causing wastage of resources. Sustainability is a huge factor playing into Grupo Espinosa’s operations, and they’ve created a healthy environment with the sustainable use of paper and energy resources as well as keeping their employees – most of them associated with the organisation for over 10 years – happy. He adds, “In order to be truly successful, you need to be good to the environment, employees, suppliers, and your customers. But most importantly, you need to be sustainable, you need to have proper working conditions, pay proper salaries, proper prices for paper, source the paper from sustainable sources, pay your taxes, basically be a good global corporate citizen and that's probably one of the biggest achievements that we have.”