Alexander Falser – Tchibo GmbH
Alexander Falser is the Head of the Consumer Insights department at Tchibo GmbH and is responsible for questions relating to consumer research. The Tchibo GmbH, based in Hamburg, is one of the largest German consumer goods and retail companies and one of the largest coffee roasters in Europe.
KPIs for brand growth
At Tchibo there are two types of brand-related KPIs, says Alexander Falser. The classics and the newer approaches, which are for instance based on the works of Byron Sharp and Les Binet: “We are still working with two types of KPIs. We have the classics, such as the funnel KPIs, from awareness to recommendation. But for some time now, we have also been intensively working on new types of KPIs, which are based, for example, on Byron Sharp’s publications “How Brands Grow”. They demonstrate whether the growth of your own brands is headed in the right direction more accurately than the classics.” Next to the purely brand-related KPIs, there are also the more sales-relevant KPIs, explains Alexander Falser. From his point of view, household reach is especially important. This is arguably the most crucial KPI to translate brand building to sales growth.
Data-Driven Decision Making in the organisation
Tchibo has focused on DDDM for years, says Alexander Falser. Data is used in all areas, most notably in the area of e-commerce. Data-based work has also found its way in brand building and media optimisation for quite some time now. “We are relatively far along in the process, especially when it comes to matters such as digital transformation and business intelligence. We have also dealt intensively with the topic of Marketing Mix Modeling over the past few years. It was a long journey, which started with many questions: Which data sources should you use? What is the quality like? How and where should the data be merged? How do you make the data accessible? And what are the right tools? Those were big tasks to tackle at the beginning of the process. But we have gained a lot of important experience from it. Right now, it is mainly about the permanent integration of DDDM into the internal planning processes.”
The transformation process
For Alexander Falser, data-driven working is a major transformation process. The aim at Tchibo is to be even more data-driven when it comes to decision-making. But years of experience also continue to play an important role in decision-making: “Just like many companies, we are in a constant transformation process towards increasing data-driven decision making. Of course, years of experience and business acumen are still important when it comes to making decisions, but ultimately business decisions must always be drawn from and backed up by data.”
The willingness to work with data is high at Tchibo, says Alexander Falser, but one also has to get used to this way of working: “It was an easy decision to take this path because the level of willingness is high. The main challenge lies in facing what initially feels counterintuitive. You have gained years of experience and developed certain beliefs, but the data tells you otherwise. So, how do you deal with these situations? How do you build trust in what are sometimes complex data models? That is also part of the transformation process.”
Success factors and pitfalls
Questioning set beliefs and repeatedly ‘checking’ yourself is one of the most important success factors, believes Alexander Falser. Using different case studies to show that data-based work leads to better results, is just as important: “To accept a different interpretation when data shows you something other than what you expected, you need to understand the data, the processes and the models. But you also must use case studies to prove that data-driven work leads to higher success rates, higher conversions and more customer enthusiasm, and ultimately, of course, to more revenue.” Alexander Falser believes that the data validation process is another success factor, you should only use data that is credible, reliable and stable: “You need to find the right data sources at the start. What kind of data is there? What sources are reliable and can be used continuously? There are innumerable sources of data, but what are the right ones?”
The role of market research
“A lot is changing, more than ever since the beginnings of market research. The dynamic is enormous and drastically changes the role of the in-house market researcher. You must build up new skills, deal with data science and new forms of interpretation and visualisation of data. For some, that also means you need to start all over again by learning”, says Alexander Falser. In his opinion, AI will play an increasingly important role in the future and will lift some of the work of the researchers: “Ultimately, AI is a forecasting technology and a lot of what we do in market research has to do with forecasting. Now there is a technology that can do a lot of this work for you. This leads to a new relationship between people and technology and different focus areas of activities.”
Alexander Falser shares that the aim in terms of DDDM, in media and brand management, is the ability to operate data-based and promptly. Using powerful and intuitive software, with the option of playing through different scenarios and running Test & Learns. There are plenty of new ideas and sources of inspiration for this, online, at seminars, conferences, podcasts and new, exciting publications.