At the level of large corporations, it seems that everyone is striving to become data driven. From insurers leveraging data from multiple touch points to assess risk, price policies and accelerate claims processing to manufacturers analysing information from sensors to detect faults, business models and practices are being reworked with the help of increasingly advanced analytics.
But what about smaller companies? Startups and relatively early-stage businesses. Is it possible to be data-driven, even at the start of a business journey?
According to Julian Hearn, founder and Chief Marketing Officer of food manufacturer and seller, Huel, the answer to that question is yes.
Founded seven years ago, Huel makes affordable vegan food. With annualised sales of around £70 million and a payroll of 200, the company has travelled a long way in a relatively short period of time and Hearn says data analytics has played an important part in the growth story. “We’ve been able to take a deeper look at insights that help give us a competitive edge and contribute growth to the business,” he says.
But what does that mean in practice? In simple terms, Huel is in the food retail business. It’s products are designed to offer balanced vegan meals at low cost, with the various packages sold on a subscription basis.
So when I spoke to the company’s Chief Data Scientist, Jay Kotecha, I was keen to find out why data is seen as an important component in the success of the business.
A Question Of Culture
As Kotecha explains, Huel has sought to create a data culture that extends to all employees. “We train all our colleagues,” he says. “And everyone has a licence to use Tableau (a data visualisation tool).
The practical effect is that everyone in the company is empowered to make decisions based on the best available data at any given time, with the information presented in an easy to understand format. “It’s super important,” says Kotecha. “Anyone can make real time decisions.”
There are a number of key metrics. These include customer spend, customer acquisition costs, the lifetime value of the customer and the access channels they are using. These insights have enabled the business to target and serve its customers more successfully. At the same time, real-time information on the products themselves – in particular which of them are performing well – also feeds into the marketing mix.
But creating a data culture – and building a framework to capture all the relevant information – can seem like a daunting task to young companies with limited resources. Typically, data will be pulled in from multiple sources, which might also mean a range of systems and cloud providers. The challenge is to bring all the information together in a useable format.
The Right Tools
Which inevitably means more software tools. “We use an ETL (extract, transfer, load) tool and load that into the Snowflake data warehouse,” says Kotecha.
In effect, that means a tool deployed to extract and transfer data from the various sources and then deposit it into an environment where it can be accessed and analysed.
All this requires a certain amount of resource. There are four people permanently employed on the Huel data team, which might seem a lot for a small business. And that begs a question. If you are going to invest in data, how do you ensure your commitment delivers a tangible return?
Making It useful
Dan Pell, General Manager and Senior VP at Tableau, says one of the key factors is user experience. Columns and rows can be confusing. “Employees have to be able to understand what the data means,” he says.
Equally important, there has to be some way of actioning the insights from the information. As Kotecha explains, this goes beyond simply empowering decision making. The data also flag problems and issues – say around subscription dropouts. “We have issue champions pulled from across the company who make a difference to customers,” he says.
Huel has expanded from its U.K. base into markets such as the U.S. and has also enjoyed significant growth during the Pandemic. These days, the success of mail-order businesses is a common Covid story but all retailers are in a competitive marketplace. Huel believes proactive use of data provides an edge.
Forbes – Entrepreneurs