NEW YORK, USA: Business Intelligence/data mining (BI), a strategic analytical tool that provides methods for controlling the bottom line and guiding marketing campaigns, appears poised for growth in the Latin American market. Medium businesses (MBs – 100 up to 999 employees) in the region are starting to recognize the usefulness of BI, but are still tentative in their purchase patterns.

Latin American MBs’ total software investments were US$663 million, 7 percent of total IT investments for 2009. BI packaged software users comprised 24 and 19 percent of PC MBs for Brazil and Mexico, respectively.

These findings emerged from a recent survey of Brazil and Mexico MB IT trends by New York-based Access Markets International (AMI) Partners, Inc. The survey findings reveal that MBs’ top challenges are local competition (roughly 60pc) and increasing customer satisfaction and loyalty (roughly 57pc). “These companies can use data mining tools to analyze the data and study their competitors and customer buying/retention behavior so that they can meet these challenges head-on and in real time,” says Nichelle McKenzie, Research Analyst at AMI-Partners.

Other services, manufacturing and wholesale are the dominant sectors for BI usage among Brazil and Mexico MBs. Business intelligence packaged software deployment is highest among those mid-market firms also using consolidated IP networks (41 pc) and hosted IP telephony (45pc).

“42 percent of Brazil PC MBs and 22 percent of Mexico PC MBs are using business intelligence/data mining as part of an ERP/SCM module” states Ms. McKenzie. “As part of the CRM module, a notable pattern emerges, where 24 percent of Brazil MBs and 46 percent of Mexico MBs, are using BI. Close to 85 percent of medium businesses using Business Intelligence applications feel that it is important to make IT purchases that are scalable to the growth of the business. These companies are looking for fast, but profitable results when purchasing BI software.”

Education and training on BI implementation is an important hurdle that companies need to master. “Training is critical,” notes McKenzie, “since it ensures that there are analysts in-house who can efficiently analyze data, perform data integration and segmentation to better understand the demands of their clients.”

For Latin American mid-market firms using BI technology presently, Senior Sistemas, is the key Brazilian vendor and Business Objects/SAP is the major market provider in Mexico. The potential opportunity for BI software vendors is huge in Latin America with many MBs (76% in Brazil and 80% in Mexico) not using any form of Business Intelligence software.

The future of BI software investment and adoption is growing. It is the new measure of product performance and managing/understanding customer end user demands. The key IT/CIO person goal is to leverage the data so that it can direct the sales and marketing teams toward product and services that will have a positive impact on revenues.

Related Studies

AMI-Partners’ 2008-09: Brazil Medium Business Market Overview –Impact of Economy: Changing Dynamics, Opportunities & Challenges and 2008-09: Mexico Medium Business Market Overview –Impact of Economy: Changing Dynamics, Opportunities & Challenges studies highlight major trends in the context of current/planned IT, Internet and communications usage and spending. Products and services covered include established and emerging hardware, software, applications and business process solutions. Based on AMI-Partners’ annual surveys of SMBs in India, the studies track a broad spectrum of issues pertaining to budgets, purchase behaviors, decision influencers, channel preferences, outsourcing, service and support. Also covered are detailed firmographics and critically important technology attitudes and strategic planning priorities. This data points to key opportunities and messaging hot buttons for vendors and service providers seeking to match their offerings to SMB market requirements.

In light of global recessionary fears and the impact of economic downshifts on business, AMI-Partners has expanded its tracking studies to include several questions pertaining to SMBs’ perceptions of their dependence on local, national and global economies as well as their expectations about economic growth. These questions gained added significance in light of the timing of this year’s studies, which overlapped with the global financial crisis starting in mid-September. AMI-Partners’ studies, thus, present an early picture of an SMB market undergoing a major transition. Given that many SMBs are at the leading edge of this transition, AMI-Partners has included an additional analysis in this year’s reports to assess demographics, attitudes, current IT adoption as well as planned IT purchases among “concerned SMBs” compared to the rest of the market. (AMI-Partners defines concerned SBs as those that expect the local/regional economy will get worse in the next one year and concerned MBs as those that expect the local/regional, national or global economy to get worse in the next one year.)