1. What is a data warehouse and why is REI building one?
A data warehouse is a database that stores current and historical data of potential interest to decision makers throughout the company. The data originate in many core operational transaction systems, such as systems for sales, customer accounts, and manufacturing, and may include data from Web site transactions. In REI’s case, it does include Web site transaction data. REI is building one to more effectively aggregate and apply the information it has gathered about its customers.
2. What are some of the disadvantages of consumer cooperatives compared to “traditional” firms?
One disadvantage might be that since a co-op is run ‘democratically’, building a consensus and getting things done quickly might be slower than firms with a more rigid hierarchical structure.
3. Describe some of the marketing strategies that REI’s data warehouse will allow it to use.
Would these have been possible before the data warehouse was built?
REI will be able to determine items a customer has bought multiple times, classes, workshops, and events customers attend, and other information that will allow them to more accurately market products consumers are interested in seeing on an individual basis.
4. What are some of the risks or concerns surrounding the creation of a data warehouse?
As always, when dealing with large amounts of data concentrated centrally, it’s important to keep that data secure. REI is likely to have sensitive information like credit card numbers on file for its customers, so it’s critical that they keep their data warehouse safe.
5. Why do you think REI chose to work with IBM's data warehouse technology?
REI likely chose IBM because of their proven track record for working with customers of any size and scale. IBM is the safe choice for a company hoping to successfully implement data warehousing technology, as well as many other types of technologies. Now if REI plans to use any other IBM technologies, they will already have a working relationship with IBM.