Serverless and BigQuery Together on Google Cloud: Behind the L'Oreal Beauty Tech Data Platform - Build What's Next
Case Study

Serverless and BigQuery Together on Google Cloud: Behind the L’Oreal Beauty Tech Data Platform

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L'Oreal builds Beauty Tech Data Platform to address its complex data infrastructure needs and few of its non-negotiable principles with Google Cloud and BigQuery. Read on how the beauty leader drove transformations leveraging terrabytes of data!

Editor’s note: In Today’s guest post we hear from beauty leader L’Oréal about their approach to building a modern data platform on fully managed services: managing the ingest of diverse datasets into BigQuery with Cloud Run, and orchestrating transformations into relevant business domain representations for stakeholders across the organization. Learn more about how businesses have benefited from Cloud Run in Forrester’s report on Total Economic Impact.

L’Oréal was born out of science. For over 100 years, we have always shaped the future of beauty, and taken its eternal quest to new horizons. This has earned us our current position as the world’s uncontested beauty leader (~€ 32 B annual sales in 2021), present in 150 countries with over 85,000 employees.

Today, with the power of our game-changing science, multiplied by cutting-edge technologies, we continue our lifelong journey of shaping the future of beauty.

As a Beauty Tech company, we leverage our decades-long heritage of rich data assets to empower our decision-making with instant, sophisticated analysis.

Because we oversee global brands, which must adapt to local requirements, we need to maintain a deep understanding of what a brands’ data represents, while managing disparate legal and regulatory requirements for different countries. Our end goal is to run a safe, compliant and sustainable data warehouse as efficiently and effectively as possible.

We sync and aggregate internal and external data from a wide variety of sources across organizations and retail stores. This made the management of our data warehouse infrastructure used to be very complex and hard to manage before Google Cloud. L’Oréal’s footprint was so large that we once found it impossible to have a standardized method to handle data. Every process was vendor-specific, and the infrastructure was brittle. We went looking for a solution to our complex data infrastructure needs, and defined the following non-negotiable principles:

  • No Ops: The job of a developer at L’Oréal is not to manage servers. We need an elastic infrastructure that scales on demand, so that our developers can focus on delivering customized and inclusive beauty experiences to all consumers, rather than focusing on managing servers.
  • Secure: We have strict security and compliance requirements which vary by country, and we employ a zero-trust security strategy. We must keep both our own internal data and customer data safe and encrypted.
  • Sustainable : Our data lives in multiple environments, including on-prem data centers and public cloud services. We must be able to securely access and analyze this data while minimizing the complexity and environmental impact of moving and duplicating data.
  • End-to-end supervision: Because developers shouldn’t be managing servers, we need a “single pane of glass” dashboard to monitor and triage the system if something goes wrong.
  • Easy-to-deploy: Deploying code safely should not compromise velocity. We are constantly developing innovations that push the boundaries of science and reinvent beauty rituals. We need integrated tools to make our code deployment process seamless and safe.
  • Event-driven architecture: Our data is used globally by research, product, business and engineering teams with high expectations on data quality and timeliness. Many of our internal processes and analysis are based on near real-time data.
  • Data products delivered “as a service”: We want to empower our employees to drive business value at record speed. To that end, we need solutions that enable us to remove the developers from the critical path of solution delivery as much as possible.
  • Extract-load-transform (ELT): Our goal is to implement the pattern to load data as soon as possible into the data warehouse to take advantage of SQL transformations.

After considering multiple vendors on the market, with these principles in mind, we landed on end-to-end Google Cloud serverless and data tooling. We were already using Google Cloud for a few processes, including BigQuery, and loved the experience.

We’ve now expanded our use of Google Cloud to fully support the L’Oréal Beauty Tech Data Platform.

L’Oréal’s Beauty Tech Data Platform incorporates data from two types of sources: directly via API, which is data that adapts easily to our schema and is inserted directly into BigQuery, and bulk data from integrations, which require event-driven transformations using Eventarc mechanisms. These transformations are performed in Cloud Run and Cloud Functions (2nd gen), or directly in SQL. With Google Cloud, we can adapt very quickly.

Today, we currently have 8500 flows for ~5000 users using the native zero-trust capabilities offered by Google Cloud. Indeed, the flows come from Google Cloud and other third-party services.

BigQuery enabled us to adopt standard SQL as our universal language in our data warehouse and meet all expectations for queries and reporting. We were also able to load original data using features like federated queries, and efficiently transitioned from ETL to ELT data ingestion by handling semi-structured data with SQL. This approach of loading original data from sources into BigQuery with non-destructive transformations allows us to reprocess data for new use-cases easily, directly within BigQuery.

Our applications are hosted on multiple environments – on-premises, in Google Cloud, and in other public clouds. This made it difficult for our data engineers and analysts to natively analyze data across clouds until we started using BigQuery Omni. This capability of BigQuery allowed us to globally access and analyze data across clouds through a single pane of glass using the native BigQuery user interface itself. Without BigQuery Omni, it would’ve been impossible for our teams to natively do cross-cloud analytics. Moreover, it eliminated the need for us to move sensitive data, which is not only expensive because of local tax and subsea transport, but also incredibly risky – sometimes even forbidden – because of local regulations.

Today Google Cloud powers our Beauty Tech Data Platform, which stores 100TB of production data in BigQuery and processes 20TB of data each month. We have more than 8000 governed datasets, and 2 millions of BigQuery tables coming from multiple data sources such as Salesforce, SAP, Microsoft, and Google Ads.

For more complex transformations where custom and specific libraries are required, Cloud Workflows help us to manage the complexity very efficiently by orchestrating steps in containers through Cloud Run, Cloud Functions and even BigQuery jobs — the most used way to transform and add value to the L’Oréal data.

Additionally, by using BigQuery and Google Cloud’s serverless compute for API ingestion, bulk data loading, and post-loading transformations, we can keep the entire system in a single boundary of trust at a fraction of the cost. With ingest, queries, and transformations all being fully elastic and on-demand, we no longer have to perform capacity planning for either the compute or analytics components of the system. And of course these services’ pay-as-you-go model perfectly aligns with L’Oréal’s strategy of only paying for something when you use it.

Google Cloud fulfilled the requirements of our Beauty Tech Data Platform. And as if offering us a no-ops, secure, easy-to-deploy, custom-development free, event-based platform with end-to-end supervision wasn’t enough, Google Cloud also helped us with our sustainability efforts.

Being able to measure and understand the environmental footprint of our public cloud usage is also a key part of our sustainable tech roadmap. With Google Cloud Carbon Footprint, we can easily see the impact of our sustainable infrastructure approach and architecture principles. Our Beauty Tech platform is a strategic ambition for L’Oréal: inventing the beauty products of the future while becoming the company of the future.

Sustainable tech is an imperative and a very important step towards this ambition of creating responsible beauty for our consumers, and sustainable-by-design tech services for our employees. We all have a role to play, and by joining forces, we can have a positive impact.

Google Cloud’s data ecosystem and serverless tools are highly complementary, and made it possible to build a next-generation data analytics platform that met all our needs.

Get started using serverless and BigQuery together on Google Cloud today.

Case Study

Google Cloud Helped Digitec Galaxus Personalize Over 2 Million Newsletters in a Week

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Swiss consumer electronics and media products brand Digitec Galaxus and Google Cloud built many recommendation systems to offer personalised experience and content. Read to learn how the brand personalised over 2 million newsletters/week.

Digitec Galaxus AG is the biggest online retailer in Switzerland, operating two online stores: Digitec, Switzerland’s online market leader for consumer electronics and media products, and Galaxus, the largest Swiss online shop with a steadily growing range of consistently low-priced products for almost all daily needs. 

Known for its efficient, personalized shopping experiences, it’s clear that Digitec Galaxus understands what it takes to deliver a platform that is interesting and relevant to customers every time they shop. 

The problem: Personalizing decisions for every situation

Digitec Galaxus already had established an engine to help them personalize experiences for shoppers when they reached out to Google Cloud. They had multiple recommendation systems in place and were also extensive early adopters of Recommendations AI, which already enabled them to offer personalized content in places like their homepages, product detail pages, and their newsletter. 

But those same systems sometimes made it difficult to understand how best to combine and optimize to create the most personalized experiences for their shoppers. Their requirements were threefold:

  1. Personalization: They have over 12 recommenders they can display on the app, however they would like to contextualize this and choose different recommenders (which in turn select the items) for different users. Furthermore they would like to exploit existing trends as well as experiment with new ones.
  2. Latency: They would like to ensure that the solution is architected so that the ranked list of recommenders can be retrieved with sub 50 ms latency.
  3. End-to-end easy to maintain & generalizable/modular architecture: Digitec wanted the solution to be architected using an easy to maintain, open source stack, complete with all MLops capabilities required to train and use contextual bandits models. It was also important to them that it is built in a modular fashion such that it can be adapted easily to other use cases which have in mind such as recommendations on the homepage, Smartags and more . 

To improve, they asked us to help them implement a machine learning (ML) contextual bandit based recommender system on Google Cloud taking all the above factors into consideration to take their personalization to the next level. 

Contextual bandits algorithms are a simplified form of reinforcement learning and help aid real-world decision making by factoring in additional information about the visitor (context) to help learn what is most engaging for each individual. They also excel at exploiting trends which work well, as well as exploring new untested trends which can yield potentially even better results. For instance, imagine that you are personalizing a homepage image where you could show a comfy living room couch or pet supplies. 

Without a contextual bandit algorithm, one of these images would be shown to someone at random without considering information you may have observed about them during previous visits. Contextual bandits enable businesses to consider outside context, such as previously visited pages or other purchases, and then observe the final outcome (a click on the image) to help determine what works best. 

Creating a personalization system with contextual bandits

While Digitec Galaxus heavily personalizes their website homepages, they are very very sensitive and also require more cross-team collaboration to update and make changes. 

Together with the Digitec Galaxus team, we decided to narrow the scope and focus on building a contextual bandit personalization system for the newsletter first. The digitec Galaxus team has complete control over newsletter decisions and testing various ML experiments on a newsletter would have less chance of adverse revenue impact than a website homepage. 

The main goal was to architect a system that could be easily ported over to the homepage and other services offered by Digitec with minimal adaptations. It would also need to satisfy the functional and non-functional requirements of the homepage as well as other internal use cases.

Below is a diagram of how the newsletter’s personalization recommendation system works:

Digitec-01.jpg
Click to enlarge
  • The system is given some context features about the newsletter subscriber such as their purchase history and demographics. Features are sometimes referred to as variables or attributes, and can vary widely depending on what data is being analyzed. 
  • The contextual bandit model trains recommendations using those context features and 12 available recommenders (potential actions). 
  • The model then calculates which action is most likely to enhance the chance of reward (a user clicking in the newsletter) and also minimize the problem (an unsubscribe). 

Calculating whether a click was a newsletter or an unsubscribe enabled the system to optimize for increasing clicks and avoid showing non-relevant content to the user (click-bait). This enabled Digitec Galaxus to exploit popular trends while also exploring potentially better-performing trends. 

How Google Cloud helps

The newsletter context-driven personalization system was built on Google Cloud architecture using the ML recommendation training and prediction solutions available within our ecosystem. 

Below is a diagram of the high-level architecture used:

The architecture covers three phases of generating context-driven ML predictions, including: 

ML Development: Designing and building the ML models and pipeline 
Vertex Notebooks are used as data science environments for experimentation and prototyping. Notebooks are also used to implement model training, scoring components, and pipelines. The source code is version controlled in Github. A continuous integration (CI) pipeline is set up to automatically run unit tests, build pipeline components, and store the container images to Cloud Container Registry. 

ML Training: Large-scale training and storing of ML models 
The training pipeline is executed on Vertex Pipelines. In essence, the pipeline trains the model using new training data extracted from BigQuery and produces a trained, validated contextual bandit model stored in the model registry. In our system, the model registry is a curated Cloud Storage

The training pipeline uses Dataflow for large scale data extraction, validation, processing, and model evaluation, and Vertex Training for large-scale distributed training of the model. AI Platform Pipelines also stores artifacts, the output of training models, produced by the various pipeline steps to Cloud Storage. Information about these artifacts are then stored in an ML metadata database in Cloud SQL. To learn more about how to build a Continuous Training Pipeline, read the documentation guide.

ML Serving: Deploying new algorithms and experiments in production 
The training pipeline uses batch prediction to generate many predictions at once using AI Platform Pipelines, allowing Digitec Galaxus to score large data sets. Once the predictions are produced, they are stored in Cloud Datastore for consumption. The pipeline uses the most recent contextual bandit model in the model registry to evaluate the inference dataset in BigQuery and give a ranked list of the best newsletters for each user, and persist it in Datastore. A Cloud Function is provided as a REST/HTTP endpoint to retrieve the precomputed predictions from Datastore.

All components of the code and architecture are modular and easy to use, which means they can be adapted and tweaked to several other use cases within the company as well.

Better newsletter predictions for millions

The newsletter prediction system was first deployed in production in February, and Digitec Galaxus has been using it to personalize over 2 million newsletters a week for subscribers. The results have been impressive, 50% higher than our baseline. However, the collaboration is still ongoing to improve the results even more. 

“Working at this level in direct exchange with Google’s machine learning experts is a unique opportunity for us. The use of contextual bandits in the targeting of our recommendations enables us to pursue completely new approaches in personalization by also personalizing the delivery of the respective recommender to the user. We have already achieved good results in our newsletter in initial experiments and are now working on extending the approach to the entire newsletter by including more contextual data about the bandits arms. Furthermore, as a next step, we intend to apply the system to our online store as well, in order to provide our users with an even more personalized experience. To build this scalable solution, we are using Google’s open source tools such as TFX and TF Agents, as well as Google Cloud Services such as Compute Engine, Cloud Machine Learning Engine, Kubernetes Engine and Cloud Dataflow.”—Christian Sager, Product Owner, Personalization ( Digitec Galaxus)

Since the existing architecture and system is also dynamic, it will automatically adapt to new behaviours, trends, and users. As a result, Digitec Galaxus plans to re-use the same components and extend the existing system to help them improve the personalization of their homepage and other current use cases they have within the company. Beyond clicks and user engagement, the system’s flexibility also allows for future optimization of other criteria. It’s a very exciting time and we can’t wait to see what they build next!

Case Study

Carbon Health: Transforming outcomes with Connected Sheets for Looker

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Are you looking for a way to transform your healthcare organization's operating outcomes? Carbon Health has found success with Connected Sheets for Looker. Read on to learn how this powerful combination is revolutionizing the way they do business.

Everyone wants affordable, quality healthcare but not everyone has it. A 2021 report by the Commonwealth Fund ranked the U.S. in last place among 11 high-income countries in healthcare access.1 Carbon Health is working to change that. We are doing so by combining the best of virtual care, in-person visits, and technology to support patients with their everyday physical and mental health needs.

Rethinking how data and analytics are accessed at Carbon Health

Delivering premium healthcare for the masses that’s accessible and affordable is an ambitious undertaking. It requires a commitment to operating the business in an efficient and disciplined way. To meet our goals, our teams across the company require detailed, daily insights into operating results.

In the last year, we realized our existing BI platform was inaccessible to most of our employees outside of R&D. Creating the analytics, dashboards, and reports needed by our clinic leaders and executives required direct help from our data scientists.

However, this has all changed since deploying Looker as our new BI platform. We initially used Looker to build tables, charts, and graphs that improved how people could access and analyze data about our operating efficiency. As we continued to evaluate how our data and analytics should be experienced by our in-clinic staff, we learned about Connected Sheets for Looker, which has unlocked an entirely new way of sharing insights across the company.

A new way to deliver performance reporting and drive results

Connected Sheets for Looker gives Carbon Health employees who work in Google Sheets—practically everyone—a familiar tool for working with Looker data. For instance, one of our first outputs using the Connected Sheets integration has been a daily and weekly performance push-report for the clinic’s operating leaders, including providers.

Essentially a scorecard, the report tracks the most important KPIs for measuring clinics’ successes, including appointment volume, patient satisfaction such as net promoter score (NPS), reviews, phone call answer rates, and even metrics about billing and collections. To provide easy access, we built a workflow through Google App Script that takes our daily performance report and automatically emails a PDF to key clinic leaders each morning.

Within the first 30 days of the report’s creation, clinic leaders were able to drive noticeable improvements in operating results. For instance, actively tracking clinic volume has enabled us to manage our schedules more effectively, which in turn drives more visits and enables us to better communicate expectations with our patients. Other clinics have dramatically improved their call answer rates by tracking inbound call volume, which has also led to better patient satisfaction.

Greater accountability, greater collaboration

As you can imagine, a report that holds people accountable for outcomes in such a visible way can create some anxiety. We’ve eased those concerns by using the information constructively, with the goal to use reporting as a positive feedback mechanism to bolster open collaboration and identify operational processes that need improvement. For example, data about our call answer rates initiated an investigation that led to an operational redesign of how phones are deployed and managed at more than 120 clinics across the U.S.

Looker as a scalable solution with endless applications

We’re now rolling out Connected Sheets for Looker to deliver performance push-reporting across all teams at Carbon Health. Additionally, we continue to find new ways to leverage Connected Sheets for Looker to meet other needs of the business.

For instance, we’ve recently been able to better understand our software costs by analyzing vendor spend from our accounting systems directly in Google Sheets. Going forward, this will allow us to build a basic workflow to monitor subscription spend and employee application usage, which will lead to us saving money on unnecessary licenses and underutilized software.

We’ve come a long way in the last year. Between Looker and its integration with Google Sheets, we can meet the data needs of all our stakeholders at Carbon Health. Connected Sheets for Looker has been an impactful solution that’s going to help us drive measurable results in how we deliver premium healthcare to the masses.

1. Mirror, Mirror 2021: Reflecting Poorly
2.  HEALTHCARE EDITORS’ PICK Meet The Immigrant Entrepreneurs Who Raised $350 Million To Rethink U.S. Primary Care

Trend Analysis

How Google Cloud Solutions Help Retail Firms to ABP(Always Be Pivoting)

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Data analytics and AI-based demand forecasting, product discovery that drive conversion and tools for modern store experiences--are the innovation trio to help retail firms to keep pivoting. Read Google Cloud's role in ushering them towards ABP.

For years, retailers have been told that they must embrace a litany of new technologies, trends, and imperatives like online shopping, mobile apps, omnichannel, and digital transformation. In search of growth and stability, retailers adopted many of these, only to realize that for every box they ticked, there was another one waiting.

And then the pandemic hit, along with rising social movements and increasingly harsh weather. Some retailers were more prepared to take on these disruptions than others, which crystallized a new universal truth across the industry: the ability to adapt on the fly became the most important trait to survive and thrive.

Today’s retail landscape has surfaced both existing and new challenges for specialty and department store retailers. Approximately 88% of purchases previously occurred within a store environment. Now, it’s closer to 59%, with the remainder done online or through other omni methods. 

With such constant change and upheaval, it can feel like the mantra now is ABP: always be pivoting. 

The big question isn’t just how to maintain constant momentum and agility—it’s how to do it without sapping your workforce, your inventory, or your profits in the process. The pivot is now a given. What matters is how you do it.

Adapting requires a flexible base of technology that allows retailers to shift and scale seamlessly with the needs of the moment. 

They need to be able to leverage real-time insights and enhance customer experiences rapidly, online and in the real world (not to mention the growing hybridization that’s AR and VR). They need to modernize their stores to power engaging consumer and associate experiences. They need to enhance operations for rapid scaling between full operations and digital-only offerings.

To help retailers achieve these goals and more, Google Cloud is honing a trio of essential innovations: demand forecasting that harnesses the power of data analytics and artificial intelligence; enhanced product discovery to improve conversion across channels; and the tools to help create the modern store experience.

In other words, here’s some of the biggest ways we’re ready to help you pivot.

Pivot point 1: Harnessing data and AI for demand forecasting with Vertex AI

One of the greatest challenges for retailers when building organizational flexibility is managing inventory and the supply chain. 

We are in the midst of one of the worst global supply chain crises, stemming from soaring demand and logistics issues brought on by the pandemic. This crisis has only heightened the challenge retailers face when assessing demand and product availability. Even in normal times, mismanagement of inventory can add up to a trillion-dollar problem, according to IHL Group (costing $634 billion in lost sales worldwide each year, while overstocks result in $472 billion in lost revenues due to markdowns). 

On the flipside, optimizing your supply chain can lead to greater profits. For instance, McKinsey predicts that a 10% to 20% improvement in retail supply chain forecasting accuracy is likely to produce a 5% reduction in inventory costs and a 2% to 3% increase in revenues.

Some of the challenges related to demand forecasting include:

  • Low accuracy leads to excess inventory, missed sales, and pressure on fragile supply chains.
  • Real drivers of product demand are not included, because large datasets are hard to model using traditional methods.
  • Poor accuracy for new product launches and products that have sparse or intermittent demand.
  • Complex models are hard to understand, leading to poor product allocation and low return on investment on promotions.
  • Different departments use different methods, leading to miscommunication and costly reconciliation errors.

AI-based demand forecasting techniques can help. Vertex AI Forecast supports retailers in maintaining greater inventory flexibility by infusing machine learning into their existing systems. Machine learning and AI-based forecasting models like Vertex AI are able to digest large sets of disparate data, drive analytics and automatically adjust when provided with new information. 

With these machine learning models, retailers can not only incorporate historical sales data, but also use close to real-time data such as marketing campaigns, web actions like a customer clicking the “add to cart” button on a website, local weather forecasts, and much more. 

Pivot point 2: Enhanced product discovery through AI-powered search and recommendations

If customers can’t easily find what they are looking for, whether online or at the store, they will turn to someone else. That’s a simple statement, but one with profound impacts.

In research conducted by The Harris Poll and Google Cloud, we found that over a six month period, 95% of consumers received search results that were not relevant to what they were searching for on a retail website. And roughly 85% of consumers view a brand differently after an unsuccessful search, while 74% say they avoid websites where they’ve experienced search difficulties in the past.

Each year, retailers lose more than $300 billion dollars from search abandonment, or when a consumer searches for a product on a retailer’s website but does not find what they are looking for. Our product discovery solutions help you surface the right products, to the right customers, at the right time. These solutions include: 

  • Vision Product Search, which is like bringing the augmented reality of Google Lens to a retailer’s own branded mobile app experience. Both shoppers and retail store associates can search for products using an image they’ve photographed or found online and receive a ranked list of similar items.
  • Recommendations AI, which enables retailers to deliver highly personalized recommendations at scale across channels.
  • Retail Search, which provides Google-quality search results on a retailer’s own website and mobile applications.

All three are powered by Google Cloud, leveraging Google’s advanced understanding of user context and intent, utilizing technology to deliver a seamless experience to every shopper. With these combined capabilities, retailers are able to reduce search abandonment and improve conversions across their digital properties. 

Pivot point 3: Building the modern store

Stores are no longer places for just browsing and buying. They must be flexible operation centers, ready to pivot to address changing circumstances. The modern store must be multiple things at once: a mini-fulfillment and return center, a recommendation engine, a shopping destination, a fun place to work, and more. 

Just as retail companies had to embrace omnichannel, stores are now becoming omnichannel centers on their own, mixing the digital and physical into a single location. Retailers can use physical stores as a vehicle to deliver superior customer experiences. This will demand heightened levels of collaboration and cooperation between stores, digital, and tech infrastructure teams, building on the agile ways they have worked together.

In many ways, it’s about allowing our physical spaces to function more like digital ones. Google Cloud can help by bringing the scalability, security, and reliability of the cloud to the store, allowing physical locations to upgrade infrastructure and modernize their internal and customer-facing applications. 

Think of it as when a new OS gets released for your phone. It’s the same small, hard box, but the experience can feel radically different. Now, extend that same idea to a digitally enabled store. With the right displays, interfaces, and tools at a given retail location, the team only needs to send an over-the-air update to create radically fresh experiences, ranging from sales displays to fulfillment or employee engagement.

Such an approach can enable streamlined experiences for both customers and store associates. For instance, when it comes to the modern store’s evolving role as a fulfillment or return center, cloud solutions can help drive efficiency in stores through automation of ordering, replenishment, and fulfillment of omnichannel order selection.  

Similar tools for personalized product discovery online can be applied to customers in the store, helping them to browse and explore, or even create a tailored shopping experience. 

The impact of store associates can be maximized by equipping them with technology to provide expertise that drives value-added customer service, as well as increasing productivity in stores by streamlining operations, thus lowering overhead cost. At the register, customers should be able to enjoy frictionless checkout while ensuring reliable, accurate, secure transactions.

Google Cloud can help retailers transform

The ability to adapt and pivot to meet today’s changing consumer needs requires that retailers rely on modern tools to obtain operational flexibility. We believe that every company can be a tech company. That every decision is data driven. That every store is physical and digital all at once. That every worker is a tech worker. 

Google Cloud works with retailers to help them solve their most challenging problems. We have the unique ability to handle massive amounts of unstructured data, in addition to advanced capabilities in AI and ML. Our products and solutions help retailers focus on what’s most important—from improving operations to capturing digital and omnichannel revenue.

Case Study

Seven-Eleven Japan Leverages Google Cloud’s Performance and Speed for Real-time Business Insights

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To cope up with rapid digitization led by smartphone proliferation and IT-vendor dependencies, businesses need to move away from legacy systems and infrastructure that limit the distribution, access and scalability of datasets. With Google Cloud platform and range of products, retail giant, Seven-Eleven Japan (SEJ) achieves targets with high speed responses, growth of its data cloud and business value.

With the rise of technologies like smartphones, retailers have felt the pressure to meet evolving consumer needs and expectations. Seven-Eleven Japan(“SEJ”) has long been on the forefront of this thanks to the way they develop and invest in IT. However, in recent years, Japan’s leading convenience store chain has struggled to maintain its complex legacy systems at the rate needed to keep up with today’s rapid digitization, spurred on by the increasing proliferation of smartphones and an IT vendor-dependent structure.  

Legacy systems limiting real-time responsiveness and innovation 

Since its early days, SEJ has been proactive in adopting information technology, mainly relying on technology solutions from Japan’s leading vendors. But as the systems have grown, key business issues have been resolved using a vendor-dependent structure rather than being driven by SEJ’s own needs.  

Datasets and business logic were combined and built into legacy environments, gradually leading to data silos. As a result, data was distributed across multiple systems, causing a variety of problems, including the inability to efficiently retrieve data when needed, delays in accessing data collected in individual stores, and difficulties taking measurements at the right time in business operations that require real-time responsiveness.

Connecting different systems also takes time and money, and the lead time for introducing new services—from planning to development and launch—has been longer than expected. 

To solve these problems, SEJ’s IT department built “Seven Central”—a new platform for practical data use launched in 2020 to support the company’s future IT strategies and digital transformation initiatives.

At its core, Seven Central’s ultimate purpose is to allow real-time data views. Versatile, real-time datasets—such as point-of-sale (POS) data from 7-Eleven stores—are consolidated into a centralized location in the cloud. They created a simple data mart that provides data via an API to enable them to respond more quickly to requests from individual departments. 

“In such uncertain times, it’s vital to use data to make quick decisions,” says Izuru Nishimura, Executive Officer and Head of ICT Department. “Each department across the entire company will be able to gain an immediate understanding of the situation based on the most up-to-date data and respond accordingly. This is why we built Seven Central.”

Google Cloud selected to help SEJ build and grow their data cloud

Today’s rapidly changing business environment has also highlighted the risk of IT support becoming a bottleneck. The long-term strategy is to gradually expand the datasets managed and collected in Seven Central according to business needs. 

In the first phase, SEJ collected POS data from all 21,000+ stores to enable real-time analysis. Moving forward, they would like to collect other relevant data—for example, unstructured data, such as images and videos, or master datasets that are currently stored externally. 

Google Cloud was already a top contender when SEJ started developing Seven Central in 2019. They compared various public cloud services besides Google Cloud, focusing on three main capabilities.

“We placed particular emphasis on service scalability to drive future digital transformation; security when handling data, which is the lifeline of our company; and finally, openness,” says Nishimura. He emphasizes that openness was perhaps the most important factor for choosing Google Cloud. Breaking away from the negative aspects of an entirely vendor-dependent system enabled them to build an agile development system with multiple vendors. 

Google Cloud technologies including BigQuery and API management platform, Apigee, play a vital role in Seven Central. BigQuery’s high-speed processing at petabyte scale and fully managed infrastructure helped keep costs low during development and verification.   

“Data is stored in a way that allows you to share it easily across organizations, which helps solve the issue of data silos from the perspective of scalability. I also like the fact there are some interesting features that could be used in the future—like BigQuery ML, which enables machine learning on BigQuery,” says Nishimura. 

Apigee allows SEJ to separate datasets and business logic, which is one of the key points of Seven Central. While the trend these days is to standardize interfaces using an API, the reality tends to involve many different APIs rather than the introduction of one unified API. With Apigee, SEJ provides a single unified API for all of its data cloud, and they can now understand what data is used thanks to Apigee’s API usage visualizations.  

“Right now, we collect data from all 21,000+ stores,” says Nishimura. “But in anticipation of a future expansion in business operations, we have designed a system that can scale up and run without issue, even if we were to have 30,000 stores, with 1,000 customers per store per day, purchasing five items per person.”

Real-time insights with BigQuery and Cloud Spanner

Real-time insights with BigQuery and Cloud Spanner.jpg

Google Cloud partner Cloud Ace came on board early in the planning phases. Based on their recommendations, SEJ decided to continue making full use of BigQuery to analyze data collected from all 21,000+ stores throughout Japan, while also using Cloud Spanner’s availability, near-unlimited scalability and transactional consistency to help achieve the real-time results needed for the project.

“Given that both the data and the regularity with which it is accessed are expected to steadily increase in the future, we chose Cloud Spanner as backend storage for data delivery via API. We consider it a good choice,” says Shota Kikuchi, General Manager, Consulting Department, Technology Division, Cloud Ace Co., Ltd.

Finally, they chose to use Google Cloud’s Stream Analytics Solutions messaging service for collecting POS data in real time, which can then be put to immediate use with Cloud Spanner and BigQuery. 

High-speed responses exceed targets and create new value 

Seven Central went live in September 2020 with surprising results. 

They initially set a target time of one hour from when a customer makes a purchase to the point when Seven Central can use that data. But when the final system was first tried—it took barely a minute. Moving forward they estimate that the latest inventory data from the service side will become available within a few minutes of being added to the system.  

“This is real innovation, and I must admit that I am quite surprised. As well as being able to solve existing issues, we also hope it will lead to new improvements and services that have been unimaginable up until now,” says Nishimura.

The team hopes to roll out the Seven Central platform in all companies affiliated with Seven & i Holdings—not just SEJ. They also plan to explore Google Cloud AI and machine learning technologies to take on challenges in new areas. For example, they are investigating the idea of clustering individual stores using BigQuery ML.

Seven Central has already attracted attention from many departments and received a lot of requests. Nishimura and his team say they hope to continue to grow Seven Central while still observing their fundamental principles—not including business logic, maintaining real-time results, and staying true to the uniqueness of SEJ.

Learn more about Google Cloud smart analytics solutions.

Case Study

Home Depot’s Interconnected Retail Experience by Virtue of Google Cloud Migration for SAP Applications

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In 2017, home improvement brand Home Depot began its Google Cloud migration for SAP applications. The migration strategy had a multifold impact on the brand's CX and retail shopping experiences with better flexibility, speed and scale.

With nearly 2,300 stores, The Home Depot is the world’s largest home-improvement chain — a brand that professional contractors and DIYers alike have come to depend on. The home improvement industry continues to experience unprecedented demand and dramatic increases in online ordering accompanied by expanding consumer expectations for things like curbside pickup and same day delivery. The Home Depot’s decision to migrate to cloud-based infrastructure, including the migration of the company’s SAP applications on Google Cloud which began in 2017, has set it up for success in an increasingly digital world, and helped the company adapt to changing market conditions quickly. 

Interconnected retail at scale

Building on a strong customer-first philosophy, The Home Depot aims to create what it calls interconnected retail—allowing customers to shop however, whenever, and wherever they want. “So many companies are focused on omni-channel retail,” explains Sam Moses, Vice President of Corporate Systems. “At The Home Depot, we wanted to take it to the next level. Interconnected retail puts the customer at the center of everything and enables them to shop in store, online, or both. Customers can begin a transaction online and continue in-store, or vice-versa.”

To support this strategy, the company’s SAP environment needed to be more agile. Running  everything on-premises, from central finance to POS systems, meant that The Home Depot’s IT teams experienced redundancy and repetitive, manual processes. Their data warehouse needed an upgrade to process and analyze growing and increasingly diverse data sets. The Home Depot chose to migrate its SAP environment to Google Cloud to support both the velocity and scale needed for the business as well as critical analytics capabilities needed for its bold digital initiatives. “We chose Google Cloud to support our SAP implementation. Our decision had a lot to do with the relationship between Google Cloud and SAP and also for the applications and services that are offered by Google Cloud, like BigQuery, which are helping to enable data and analytics within our organization,” Moses explains.

After migrating its SAP applications—including S/4HANA, its customer activity repository (CAR), general ledger, e-commerce system, enterprise data warehouse and more to Google Cloud, the company now has the speed, scale and flexibility to tackle enormous spikes in the business, all while staying fully available for their customers. Additionally, The Home Depot was able to transform its financial systems and make them more agile to deliver critical information across multiple business functions in real time.

Maximizing data insights to support customer experiences

By migrating to Google Cloud, The Home Depot is leveraging Google Cloud analytics to build   the industry’s most efficient supply chain including more robust demand forecasting, supplier lead times, estimated delivery times and more, all while maintaining better security than before. “We experienced unprecedented change in our customers’ behavior and their buying patterns, which puts a lot of pressure on our supply chain,” explains Moses. “So having the ability to leverage data and analytics gives us insights to know exactly what it is that our customers need.” 

The company’s analysts now use BigQuery ML for machine learning directly against the company’s BigQuery data and use AutoML to determine the best model for predictions. The Home Depot’s engineers have also adapted BigQuery to monitor, analyze, and act on application performance data across all its stores and warehouses in real time—capabilities that were not as seamless in the on-premises environment.

With hundreds of projects on Google Cloud, The Home Depot’s cloud journey is well on track, but the company is always looking to the future. “As our customers’ needs have continued to evolve, and as technology has continued to evolve, our relationship with Google will continue to advance — to be able to innovate together, to be able to find new solutions together, to better serve our customers.”

Learn more about how The Home Depot is renovating its retail operation with SAP on Google Cloud.

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