Vice President of Analytic Insights Technology
From traditional publisher to an analytics powerhouse
Kelley Blue Book modernizes business with help from SAS®
For nearly a century, the Kelley Blue Book was the go-to source for the value of a used automobile. Today, its successor kbb.com is the online site for people shopping for new and used cars. SAS® Analytics have helped the company transition from providing car value estimates once a year to offering a range of online services, including valuations that are updated weekly.
For years, Kelley Blue Book collected data for one specific goal: the annual publication of its blue book. Data was summarized and aggregated, algorithms applied, all on what amounted to a 12-month cycle. There was no opportunity to analyze data further, and no need to analyze it more frequently.
As the company's kbb.com site evolved, its needs changed. "We needed to change the DNA of our company by moving from a traditional book publisher to an analytics powerhouse," said Dan Ingle, Vice President of Analytic Insights Technology at Kelley Blue Book. "Fact-based decisions have become our competitive strength. Whether or not to utilize analytics was no longer an option."
Kbb.com is now the most visited automotive website among new and used vehicle researchers, with more than 17 million visits each month. The website automatically generates more than 27 million pricing reports each month.
SAS is our standard for predictive analytics. As we continually look for ways to drive revenue for the organization, SAS helps us identify how much to invest and where. SAS gives us the innovative muscle to support the aggressive goals of Kelley Blue Book.
Looking for a robust analytics solution
Kelley Blue Book chose SAS because it needed effective and stable tools, and the ability to integrate with its existing BI platform. Shawn Hushman, Vice President of Analytic Insights, had experience with SAS and knew it could do what he needed.
"We've become an analytics-driven company by embedding SAS real-time analytics into our operations,'' says Hushman. "Our new processes provide unbiased insights to decision makers, making the reliance on conjecture a thing of the past."
"SAS helps improve the consumer vehicle purchase process. Additionally, it provides leads and insights to dealers and OEMs to support their buying, selling and finance decisions," Ingle continues. "SAS is our standard for predictive analytics. As we continually look for ways to drive revenue for the organization, SAS helps us identify how much to invest and where. [It] gives us the innovative muscle to support the aggressive goals of Kelley Blue Book."
Forecasting and optimizing advertising
Online ad revenues fuel Kelley Blue Book's website. The Kelley Blue Book Enterprise Analytics team uses SAS to forecast ad inventory, which empowers product managers to optimize impression volume and create effective pricing strategies. Advertisers purchase the impressions based on Kelley Blue Book's forecasts. In addition, SAS analyzes site traffic and behavior patterns to determine which pages and ad combinations should perform best.
On kbb.com, Kelley Blue Book uses SAS Analytics to deliver new car prices, used car Blue Book® values, classified ads, dealer locations, reviews and news to 12 million consumers each month. Understanding and adapting to visitors' nonlinear thinking process, the site now offers multiple intent-driven paths, rather than traditional "new" and "used" linear paths. And since one change can affect advertising delivery throughout the site, SAS forecasting simulation is critical in revealing how different attributes could affect revenues. SAS helps ensure visitors receive relevant information, ads and offers with the 35 million pricing reports kbb.com generates each month. Hushman notes that SAS has helped Kelley Blue Book reduce ad delivery errors by more than 25 points.
A particular challenge facing automotive dealers and lenders is pricing vehicles close to market. Kelley Blue Book has outpaced competitors by leveraging SAS to assist them in determining vehicle values. Values are updated using hundreds of thousands of transactions, including regional factors, helping businesses manage inventories to allay risk, minimize losses and increase profits.
Adding an analytic center of excellence to improve decision making
To extend the analytics culture across the company, Kelley Blue Book created an analytic center of excellence. The resulting improvements in decision making help the company consistently outperform competitors. Both costs and benefits of analytics projects are highly visible, making the power of analytics clear to all.
"We improved agility by placing analytic center of excellence and business team members together," Hushman says. "As needs arise, analytic experts contribute ideas and answer questions. They also quickly bring in SAS predictive analytics and data mining to develop, deploy and evaluate analytic models. We have slashed our time to results and enhanced our analytic insight. We expect to identify additional business opportunities by analyzing unstructured content from social media and website interactions using SAS Text Miner from the SAS Text Analytics suite."
The company needed quick, robust analytics as it created new online services.
The company can quickly calculate car values, create pricing reports and place ads on the appropriate pages, dropping ad delivery errors by 25 points.