SAP Customer Success Story Retail Fashion Merchandising/Department Stores

The SAP NetWeaver Business Intelligence functions have launched a new business era at Riachuelo.
Jorge Vasconcelos, BI Manager, Lojas Riachuelo S.A.

AT A GLANCE
Company Name: Lojas Riachuelo S.A. Location: So Paulo, Brazil Industry: Retail Products and services: Fashion Revenue: US$800 million Employees: 13,000 Web site: www.riachuelo.com.br (in Portuguese only) Partner: SAP Consulting Challenges and Opportunities Aggregate and analyze data from multiple sources Effectively handle very large data volumes Categorize customers, stores, and products for segmentation Improve campaign efficiency Objectives Consolidate information from several repositories into a single, integrated business intelligence platform Have access to comprehensive, reliable information for effective campaign planning and management Establish a new line of premium stores based on precise customer knowledge Improve strategic business planning through powerful analytics SAP Solutions and Services SAP NetWeaver Business Intelligence (SAP NetWeaver BI) component SAP xApp Analytics composite application with the SAP NetWeaver Visual Composer tool SAP NetWeaver Portal component SAP Consulting services Implementation Highlight First campaign run with new software resulted in complete sellout of advertised products within 10 weeks. Why SAP Tight integration with existing SAP software High quality of graphical user interface Ease of use for corporate executives Benefits Convenient, flexible creation of enterprise-wide, comprehensive analytics applications Easy configuration of user interfaces and reports based on SAP NetWeaver BI Effective customer segmentation Ability to match customer with product and store categories to focus on premium customers Data integration across applications Fast ROI Existing Environment SAP for Retail solution portfolio, in-house campaign management software Third-Party Integration Database: Microsoft SQL Server Hardware: IBM Operating system: Microsoft Windows 2003

LOJAS RIACHUELO
SAP xApp Analytics Composite Application with SAP NetWeaver Visual Composer Makes Business Intelligence Easy

Retail is one of the most fiercely competitive markets worldwide. A retailers success largely depends on its ability to understand its customers and fine-tune product offerings and store profiles to customer preferences. This calls for state-of-the-art business intelligence (BI) technology equipped to handle large data volumes and merge disparate sources of information into a single, enterprise-wide data warehouse while enabling user-defined analyses and reports.
Taking Analytics to the Next Level

So Paulobased Lojas Riachuelo S.A. is a leading Brazilian fashion retailer operating approximately 100 stores, a sizable logistics department, as well as a credit and loan business. For years, the company has been successfully running the SAP for Retail solution portfolio as well as SAP data warehouse software to store information on 1.5 million products, 10 million customers, and 80 million annual transactions. Several repositories delivered analytical information on the data they stored, but correlating and consolidating this information across systems was difficult. Riachuelo understood it needed to unlock the full potential of its data assets in order to segment its customers for improved campaigning, recognize interrelationships between products and customer segments, and identify trends. Riachuelos BI manager, Jorge Vasconcelos, developed a three-tiered methodology called concentric harmonic cycles (CHC) as a blueprint for implementing a new business intelligence strategy at Riachuelo.

The ultimate goal was to create a new line of premium stores for the companys most valuable customers. In search of appropriate software, Vasconcelos discovered that SAP offered the full range of functionality he was looking for, plus a leading-edge architecture to integrate all sources of information and enable fast, comprehensive reporting. Through the robust enterprise service-oriented architecture deployed by the SAP NetWeaver platform, Vasconcelos explains, we could establish an enterprise-wide business intelligence infrastructure across the transactional and analytical environments, with the SAP NetWeaver Business Intelligence component at the core. The SAP xApp Analytics composite application, the SAP NetWeaver Visual Composer tool, and the SAP NetWeaver Portal component were precisely the user-friendly tools we needed to develop custom analytics applications and user interfaces.
New Best Practices for Implementation

A New Business Era

The SAP NetWeaver Business Intelligence functions have launched a new business era at Riachuelo, says Vasconcelos. They allow us to easily build any data mart we want. Within the SAP NetWeaver architecture we can easily integrate diverse data sources for analysis and handle very large data volumes currently 200 million database records. Our executives now have much better data available for business decisions. Riachuelo immediately put its SAP NetWeaver BI solution to work in a mailing campaign. The campaign was to run for three months, reports Vasconcelos. But after only 6 weeks, the products advertised were sold out. The overwhelming success clearly showed the power of the SAP solution. Our SAP tools have refined our campaign processes, helping us select customers for specific campaigns along with the products to promote. We dont have any exact figures yet, but we have definitely increased our campaign revenues since implementing SAP NetWeaver BI. The enterprise service-oriented architecture (enterprise SOA) enables Riachuelo to integrate its processes through all functional layers and across applications, including its in-house campaign management software. By supporting our complete process cycle, the enterprise SOA offers a way to distribute the collaborative processes of the value chain within the IT infrastructure. Its performance takes us far beyond traditional architectures. Our executives are excited about the array of possibilities to generate operational and analytical reports, Vasconcelos continues. We can group stores by revenue, explore opportunities among premium clients through targeted campaigns, and identify the stores they frequent. These will become our new premium stores. We can also design product lines for specific customer groups. We are anticipating a significantly higher campaign ROI through all this.

Riachuelo implemented its new infrastructure based on the SAP NetWeaver Business Intelligence (SAP NetWeaver BI) component within a time span of only three months. Our project was delivered within budget within 80 business days as planned and remained on schedule throughout, says Vasconcelos. The CHC project management method was applied successfully and is now generally considered a best-practice approach. The retailer formed an internal BI team to supply its internal clients the executive board and top managers with analytical reports. Jointly with SAP Consulting, the team defined processes and business rules within the SAP NetWeaver BI software to satisfy the information needs. The team also deployed the SAP xApp Analytics composite application to build analytics applications for specific reporting requirements. With the user-friendly SAP NetWeaver Visual Composer tool, the BI team can easily design or modify graphical user interfaces based on the SAP NetWeaver Portal component to display information aggregated from different sources in a variety of formats and dashboards.

On the Right Track

Riachuelo now plans to gradually expand the new SAP NetWeaver based environment across all other business applications. A technical upgrade is being discussed, as are additional SAP products such as the SAP Supply Chain Management and SAP Merchandise

We can group stores by revenue, explore opportunities among premium clients through targeted campaigns, and identify the stores they frequent. These will become our new premium stores.
Jorge Vasconcelos, BI Manager, Lojas Riachuelo S.A.

and Assortment Planning applications. Vasconcelos knows he is on the right track: To me, the SAP NetWeaver platform represents the best enterprise SOA platform on the market. And I can positively say that the best practices embedded in SAP software have enabled Riachuelo to optimize its business processes and successfully complete a very challenging IT project.

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