By CONSTANCE L. HAYS
HURRICANE FRANCES was on its way, barreling across the Caribbean,
threatening a direct hit on Florida's Atlantic coast. Residents made
for higher ground, but far away, in Bentonville, Ark., executives at
Wal-Mart Stores decided that the situation offered a great
opportunity for one of their newest data-driven weapons, something
that the company calls predictive technology.
A week ahead of the storm's landfall, Linda M. Dillman, Wal-Mart's
chief information officer, pressed her staff to come up with forecasts
based on what had happened when Hurricane Charley struck several weeks
earlier. Backed by the trillions of bytes' worth of shopper history
that is stored in Wal-Mart's computer network, she felt that the
company could "start predicting what's going to happen, instead of
waiting for it to happen," as she put it.
The experts mined the data and found that the stores would indeed need
certain products -- and not just the usual flashlights. "We didn't know
in the past that strawberry Pop-Tarts increase in sales, like seven
times their normal sales rate, ahead of a hurricane," Ms. Dillman
said in a recent interview. "And the pre-hurricane top-selling item
was beer."
Thanks to those insights, trucks filled with toaster pastries and
six-packs were soon speeding down Interstate 95 toward Wal-Marts in
the path of Frances. Most of the products that were stocked for the
storm sold quickly, the company said.
Such knowledge, Wal-Mart has learned, is not only power. It is profit,
too.
http://www.nytimes.com/2004/11/14/business/yourmoney/14wal.html?ex=1258088400&en=0605d1fc88b8ab98&ei=5090
Monty Solomon (