Richard Lichtenstein of Bain & Company joins us this week to talk about advanced analytics. What is it actually and how can companies and private equity firms use this to make better business decisions? He also shares some B2C and B2B examples and use cases. Also, what are some common barriers for companies to incorporate advanced analytics to their toolset?

Richard Lichtenstein is an expert partner at Bain & Company in New York. He has been at Bain for 17 years and he leads their efforts around advanced analytics and private equity. To get in touch with Richard, please email him at Richard.Lichtenstein@bain.com.

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Show Notes

TS: For people that might not be familiar with advanced analytics or what that entails, can you kind of give us an overview of what this encompasses?

RL: At Bain & Company, we have a team of over 50 people that thinks about just how can we use advanced analytics to serve private equity. We've got a bunch of people scouring the world trying to find the latest and greatest and interesting data sources that we can use. Then we have teams of data cleaners. Then we have a group of data scientists who are building Python libraries. Then we have a group that takes that output and builds ways to automatically turn that in slides or into tableau so that we can get that in front of clients quickly in a form that brings out the insights.

And then lastly, we have some people who just help other people at Bain figure out how to use all this stuff.

TS: Can you give us some of your use cases, maybe go into a little bit more detail?

RL: So in a way, it's quite different for B2B and B2C, but both of them have a lot of good advanced analytics examples.

We've done some work recently with a fast food restaurant chain. And they're trying to figure out why are we losing share? We were able to see well among people who are going to your restaurant less often or stopped going, a lot of them were going to Chick-Fil-A. And this isn't a restaurant that sells chicken. So they hadn't really thought of them as a competitor. But they are. And that was news to them.

TS: You wrote a piece last year on like Wayfair and how they used advanced analytics to understand that it was like on the precipice of rapid growth. So what kind of other data or companies using to better understand their market?

RL: Yeah. The Wayfair analysis was really quite interesting. So it's a great example here. So that's. And in that case, it was understanding the customer behavior that we were seeing. This was early in COVID, right before the huge spike that we all know now happened. And we were just seeing people coming to Wayfair for the first time. We had never been there before, buying stuff. We were seeing people coming back with great retention.

TS: Have you found any big issues for companies using advanced analytics like it's hard to access data. It seems fairly sophisticated. So is there a barrier to understanding this kind of data and how it's presented?