Nielsen BookScan boosts revenues by 300 percent

Transforming book publishing and retail with strategic insight into sales, pricing and market share

Published on 20-Mar-2012

Validated on 02 Dec 2013

"Over the past 11 years we have expanded into nine markets and almost tripled our revenue, but we’ve only needed to add two people to our team because the solution is so highly automated. We can work normal office hours, but the system keeps on producing reports and serving our clients 24/7, wherever they are in the world." - Richard Knight, Bookscan Development Director, The Nielsen Company

Customer:
Nielsen BookScan

Industry:
Computer Services

Deployment country:
United States

Solution:
Business-to-Consumer, BA - Business Analytics, BA - Business Intelligence, Enabling Business Flexibility, Optimizing IT

Overview

Nielsen BookScan provides analytics services for publishers, retailers and libraries in nine countries around the world. BookScan collects retail sales information from point-of-sale systems at more than 31,500 book stores and analyzes them to provide accurate figures on sales, pricing and market share – helping clients transform their printing, sales and marketing strategies.

Business need:
Business objectives included: Establish market leadership through first-to-market solution and global expansion. Differentiate Nielsen as an information provider with an innovative approach to data presentation and analysis. Build a sustainable information foundation to support growth and distributed data. Implement a business analytics platform providing high speed to market for new analytics offerings; scalability to support new customers, countries and products; flexibility to address individual clients’ needs.

Solution:
Business users from more than 200 different companies log in to the BookScan system via a portal on the Nielsen web site. The solution presents each user with information about their own company’s performance in the context of the entire bookselling ecosystem; and for large multinational publishers, this can be broken down by each market they operate in. On average, the system generates more than 6,500 individual reports per week.

Results:
Boosts revenues by 300 percent

Benefits:
Delivers competitive advantage and market leadership – the solution is so innovative that Nielsen has few or no significant competitors in most of its markets. Enables customers around the world to serve themselves with real-time insight on a 24/7 basis, with no need for support from the Nielsen team. Supports custom pricing models, enabling Nielsen BookScan to provide a service to fit almost any customer’s budget. Provides an agile, flexible environment that can be easily adapted to customer requirements with minimal development costs.

Case Study

Strategy
The book industry is a complex ecosystem of publishers, retailers and other players such as public libraries. A book that catches the public imagination can deliver huge sales and enormous profits, but the economic implications of the opposite can be considerable, as thousands of unsold copies may be returned and, ultimately, pulped.

It is vital to understand which books to publish, how many copies to print, where to sell them, how to price them, and what kind of marketing strategies to employ. Nielsen provides the insight that publishers and retailers need to support these kinds of decisions through its innovative BookScan platform, which integrates and analyzes data from more than 33,500 retailers in nine key global markets.

Focus on Business Impact
From the perspective of book retailers, Nielsen BookScan offers the opportunity to participate in a virtuous circle: they provide data from their point-of-sale systems, and in return, Nielsen provides free in-depth analyses of important sales figures such as market share for each title and sales performance compared to similar titles in the past.

The vast majority of Nielsen BookScan’s revenues come from publishers, for whom it provides the ability to analyze sales of different categories of books in different markets and across different retailers. In some markets, it can even analyze public library usage, which has become an increasingly important channel for establishing new authors and brands.

Subscribers can log into the system directly via a web portal to perform analyses, and the system also automatically emails scheduled reports to each client on a daily, weekly or monthly basis, depending on the level of service they have purchased. Reports can also be provided in XML format, enabling them to be easily integrated into clients’ own systems and publications.

Business Value Outcomes
Since 1999, Nielsen BookScan has grown to become the largest source of book industry data in the world, and a leader in all the markets in which it operates. As a result of the analytical capabilities of the BookScan system, publishers and booksellers have been able to transform the way they do business. For example, in the UK, which is BookScan’s most mature market, the return rate for unsold books has fallen by around 70 percent to around 20 percent – partly as a result of increased transparency in the sales process.

For Nielsen itself, the result has been an explosion in demand for BookScan services, leading to international expansion into nine markets and a 300 percent increase in revenues.

Deeper Insight
Several different types of client use Nielsen BookScan or rely on the data that it generates. These include:

Retailers – BookScan provides visibility into the market share each retailer is achieving for each title. Since Nielsen has several years of historical data in most markets, it can also show retailers how an author’s new book is performing compared to their previous titles. In addition to these free services, retailers can also commission special reports if they need specific questions to be answered.

Public libraries – BookScan helps libraries understand which books are most popular, providing additional insight to publishers and helping them distribute their stock effectively between different locations.

Publishers’ sales and marketing teams – BookScan helps to answer questions such as whether a title is performing as well as expected, and how its pricing compares to other books in the same category. By alerting these teams to potential problems, this information can help to fine-tune marketing campaigns and ultimately boost overall sales.

Publishers’ production and distribution teams – BookScan helps to decide how many copies should be printed in each market, which helps to ensure an adequate supply of products while minimizing returns of unsold copies.

Publishers’ strategic decision-makers – BookScan provides a wealth of insight that supports long-term future publishing decisions.

Media – BookScan provides bestseller charts and other data for a wide range of newspapers and other publications around the globe.

Solution Review
Business users from more than 200 different companies log in to the BookScan system via a portal on the Nielsen web site. The solution presents each user with information about their own company’s performance in the context of the entire bookselling ecosystem; and for large multinational publishers, this can be broken down by each market they operate in. On average, the system generates more than 6,500 individual reports per week.

The level of detail provided varies depending on the client’s requirements and the terms of their subscription. Nielsen BookScan can scale the level of the service to meet the client’s business requirements – from high-level monthly reports to in-depth, highly segmented weekly or daily drill-downs for the largest clients. From Nielsen’s point of view, the ability to provide a highly tailored service enables it to offer custom pricing models to different clients.

The portal is available 24/7, and enables users to generate new analyses in real time, based on the latest data. The system also automatically creates standard reports on a set schedule, and emails them to the appropriate recipients.

If a client requires a new type of report, the Nielsen BookScan team can develop it quickly and easily and roll it out into production within a few days. Equally, when Nielsen decides to expand into a new market, the ability to reuse data structures and reports from existing markets keeps development costs to a minimum. Even though the service has been launched in an average of two new markets per year for the last four years, the Nielsen team has only added two new staff on the development team.

The Nielsen team also uses the business analytics tools to automatically monitor the quality of the product data it receives from publishers. If a publisher enters a new book into the system but forgets to fill in one of the critical data elements required for BookScan analysis, the system flags this up in a monthly audit report. These audit reports are shared with publishers, which helps to correct omissions and maintain the high data quality that makes BookScan such a valuable tool.

About IBM Business Analytics
IBM Business Analytics software delivers actionable insights decision-makers need to achieve better business performance. IBM offers a comprehensive, unified portfolio of business intelligence, predictive and advanced analytics, financial performance and strategy management, governance, risk and compliance and analytic applications. With IBM software, companies can spot trends, patterns and anomalies, compare “what if” scenarios, predict potential threats and opportunities, identify and manage key business risks and plan, budget and forecast resources. With these deep analytic capabilities our customers around the world can better understand, anticipate and shape business outcomes.

Products and services used

IBM products and services that were used in this case study.

Software:
Cognos Business Intelligence, Cognos PowerPlay

Legal Information

© Copyright IBM Corporation 2012 IBM Corporation Software Group Route 100 Somers, NY 10589 Produced in the United States of America March 2012 IBM, the IBM logo, ibm.com and Cognos are trademarks of International Business Machines Corp., registered in many jurisdictions worldwide. Other product and service names might be trademarks of IBM or other companies. A current list of IBM trademarks is available on the Web at “Copyright and trademark information” at www.ibm.com/legal/copytrade.shtml This document is current as of the initial date of publication and may be changed by IBM at any time. Not all offerings are available in every country in which IBM operates. The client examples cited are presented for illustrative purposes only. Actual performance results may vary depending on specific configurations and operating conditions. It is the user’s responsibility to evaluate and verify the operation of any other products or programs with IBM products and programs. THE INFORMATION IN THIS DOCUMENT IS PROVIDED “AS IS” WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED, INCLUDING WITHOUT ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND ANY WARRANTY OR CONDITION OF NON-INFRINGEMENT. IBM products are warranted according to the terms and conditions of the agreements under which they are provided.