Temel Kahyaoglu, Chief Analyst TGOA, in conversation with Wolfgang Wichert, CEO of eggheads, on developments in omnichannel marketing
Wolfgang Wichert has a degree in mathematics and founded eggheads GmbH in 1990. For more than 20 years, he has been developing software around the topic of product information management. As a result, Wolfgang Wichert and his eggheads rank among the pioneers of the industry and can look back upon long-standing customer partnerships in a very wide array of industries, whether manufacturers or retailers, SMEs or multinational corporations.
It once took 200 people four weeks to produce and finish 40,000 catalogue pages with 400 templates, using a highly automated process. Today, with data hubs, millions of content and media objects can be compiled, organised and provided for omnichannel marketing worldwide and in real time. This presents companies with new challenges that they must work on together to overcome.
Mr Wichert, you rank among the PIM pioneers in our industry and were presented with the IT Innovation Award for SMEs this year. How does that feel?
I am proud of the eggheads team and the honours and prizes we have won. My idea of working autonomously with the best minds, and therefore independently, to bring an innovative product to market has succeeded. I can look back on healthy and sustainable growth at eggheads. We acquired great and exciting customers for ourselves again this year, and we look to the future with absolute confidence.
From your point of view, what changes have occurred in the industry over the years?
15 years ago, the challenge still involved using product data and images for the automated creation of print catalogues and to provide content for web systems. This meant keeping an across-the-board, workflow-based PIM, MAM, PRINT system running for customers during normal business hours. Five years ago, our customers in the retail sector required across-the-board vendor onboarding. New topics, such as configuration modules for classifications and eProcurement, or APIs for all major eCommerce systems, were incorporated into the standard of the eggheads Suite. In the past, marketing was conducted using print artefacts; today, our customers apply personalised and segmented content to produce marketing power in real time across all channels.
What challenges do your customers face today?
We can see very clearly that requirements in eCommerce are driving our customers. Quite simply, enterprises face the major challenges of their necessary digital transformation. This leads to changes in distribution channels and sales strategies. Marketing strategies must be rethought as well. In some cases, even the business models themselves change. For the companies affected, the necessary changes that this involves are profound in any case. The first order of business is usually to centralise product data in one place, with the security of high data quality. The next step is to make the product data accessible to the right customers in the individual channels, and that’s where things get more difficult. Often, customers do not know how to implement genuine 1:1 marketing in eCommerce channels. The classic regional sales operation has an easier time of it. Even these operations are exposed to new challenges, however. ‘Generation Amazon’ is simply well-informed and now confronts sales staff with in-depth product knowledge. So, the aim here, too, is to keep pace. We already laid the foundation for technological responses to these challenges in 2015, with the development of our content-portal technology.
Best-of-breed or all-in-one. Where do you see the advantages and drawbacks?
We see ourselves as more of an all-in-one producer when it comes to questions on master data or content in general, and we section off commercial functions and transaction-oriented processes such as those in the field of eCommerce. Everything in between we can provide in an across-the-board, process-oriented system using the eggheads Suite. Best-of-breed benefits often relate to functional breadth or existing developer capacities. With our scrum-like R&D process, in the past and to date, we have always produced 12 releases per year that have managed to fill in missing individual functions within a project, providing these as a standard function by production start-up.
How do your customers benefit?
The eggheads Suite is a generic software; it can be tailored to customers’ individual needs, regardless of their industry or business model. Our customers want software solutions that can be introduced quickly and with manageable project costs. Our software takes this need into account, as does our cooperative project implementation. As a matter of principle, customer-initiated innovations in our software are also available to all customers. This way, functions inspired by our major customers are economically available to SMEs, and the latter benefit from the investment security that this involves. Consistent software development that tracks customer requirements, and the quick innovation adaptation in the software, make this interesting for our customers. Our customers also benefit from our eggheads days customer platform, where they have an opportunity to interact with all of our employees, apart from the respective project team. But even contacts and dialogue among our customers are made possible and actually extensively used.
How can customer requirements and standard software be reconciled?
This is precisely the difficult challenge that software companies face, and they need to come up with plausible and reliable answers. Some customer software requirements stem from project or sales situations. These requirements should be addressed in a timely manner, but the means to do so are not readily available. The decisive question is how to deal with this. One to two software releases a year are certainly not the right response to timely delivery. Nor, for that matter, is a software extension in the project framework. Ultimately, the customer must maintain update capability. There are lots of projects in the industry in which, after a certain time, the customer drops out of the standard as a result of project developments, is no longer able to update to new releases and in the end has no other choice but to set up a new project. We at eggheads found the right answer to this very challenge a full four and a half years ago. At that time, we completely restructured our development and converted to the monthly release process I mentioned a few moments ago. So, now we approach our customers with 12 software releases. And yet, none of our customers need to fear having to carry out 12 updates a year. Most of our customers carry out one to three updates each year, but they can be certain that all of the functions of all of the previous updates are included. The most important thing though is that this quick release sequence puts us in a position to respond to customer requirements in a timely manner, and always within the standard set by the software.
At least in terms of workforce size, eggheads is not the biggest company in the industry. And yet your list of references includes renowned and international companies. What’s your secret?
In my view, a company’s size is simply not a reliable indicator of success. A better gauge are the customers and the projects that have been successfully carried out. But the answer to your question is actually quite simple. Our eggheads Suite is a full-fledged enterprise PIM system that can easily be scaled across various enterprise sizes, and the software is highly configurable. We do not need to undertake project developments in customer projects; instead, we can meet requirements through configurations. Our introduction concept puts us in a position to train the customer to permit them to carry out most of the introduction independently. We then assume a coaching and advisory role in which we are available to assist the customer with our expertise, tips and tricks. In situations like these, we are more of a sparring partner, providing support through training activities. Based on our experience with some customers that, following the first joint projects, placed additional clients or divisions in production on their own, we decided to implement a partner model, based on the motto: If our customers can independently introduce the eggheads Suite, then a partner should be able to do so, too.
‘Partner’ is the right keyword. You have only a very few implementation partners at your side so far. What is the path that you intend to take here?
In this regard, we deliberately avoid the path of relying upon as many partners as possible, partners for the implementation of our software. We treat our partners as we would treat our customers and spend a great deal of time on partner communication. After all, our partners are part of the eggheads family. But it is also always important for our partners to bring added value for the customers and for us. At the end of the day, we rely upon select and hand-picked companies that we qualify and certify through our eggheads Academy. Apart from this, we will continue to implement our software directly with customers; that is something we do not intend to move away from. Now, however, customers can also actively decide to have the software introduction carried out by an implementation partner. For us, this means attracting, qualifying and finally certifying additional partners. At the same time, we are increasing our sales capacities as a means of stabilising capacity utilisation on the part of our partners. We owe this to our partners.
What does the future of eggheads look like?
Our solid growth and continuous investment in developing our software, with early response to and implementation of topics with future relevance for our customers, leads to a very high level of customer satisfaction, which is something that repeatedly comes to our attention. The completeness of our vision makes us very future-proof, with increased investment security for existing and new customers alike. We want customers to become our long-term partners. This is why we also actively involve them in the ongoing development of the solution. Some of our clients have been with us for more than ten years and have almost become colleagues. Today, our management is in a position to develop the company further, in a sustainable and future-oriented way. With this in mind, in recent years we have systematically expanded the team and laid the groundwork for further development. For me, the conversion from an owner-managed to a management-controlled enterprise was a very exciting time, and this process is ongoing.We always try to maintain the balance between technology on one side and human touch on the other. I am particularly proud to report that this is something in which we have always succeeded. Completely integrated software, a clear focus on stringent standard software and our project approach assure our customers that the requirements of such software will be met, and that projects will be carried through with a reasonable service effort and low risk, on time and within budget. At eggheads, the focus remains on growth, and for me personally, it’s still just as much fun today as it was more than 25 years ago when I founded eggheads.
With its eggheads Suite, eggheads is of one of the leading providers of standard software in the field of product information management (PIM). From master data to media management and catalogue production, all of the processes are supported across the board in a single system.
This article was published in The Produktkulturmagazin, issue Q4 2017. Picture credit © eggheads GmbH