• Woolworths said on Tuesday it had lifted its stake in Quantium, Australia’s oldest and largest data business, to 75% from 47% for $223 million.
• Quantium will form part of Woolworths, and a new business unit called Q-Retail will be established.
• “Advanced analytics is key to improving the experiences, ranges and services we provide to our customers and the support we provide to our teams and suppliers,” Woolworths CEO Brad Banducci said.
• Visit Business Insider Australia’s homepage for more stories.

Woolworths is doubling down on data analytics, outlaying $223 million to take control of data science firm Quantium and creating a new business unit to bring together advanced analytics and retail capabilities across the group.

Woolworths said on Tuesday it had lifted its stake in Quantium, Australia’s oldest and largest data business, to 75 per cent from 47 per cent for $223 million.

Woolworths originally acquired a 50 per cent stake in Quantium in 2013 for about $20 million from co-founders Adam Driussi, Greg Schneider and Tony Davis. It entered into a long term partnership, using Quantium’s data science capabilities to make better decisions on pricing, ranging, store layouts and promotions to attract and retain customers.

The transaction, which is expected to be completed before the end of June, implies a valuation of almost $800 million for Quantium, 20 times the value when the retailer acquired its initial stake eight years ago.

Following completion of the transaction, Quantium will form part of Woolworths, and a new business unit called Q-Retail will be established, bringing together advanced analytics and retail capabilities across the two businesses.

Q-Retail will focus on delivering Woolworths’ advanced analytics plan and commercialising retail products globally.

Woolworths was a major beneficiary of the pandemic, when stay-at-home consumers stocked up on pantry staples, liquor and homewares, but chief executive Brad Banduccci has warned that sales will fall in the June quarter as it cycles the surge in demand a year-ago.

“Advanced analytics is key to improving the experiences, ranges and services we provide to our customers and the support we provide to our teams and suppliers,” Mr Banducci said.

“The way we gather data, interpret it and protect it is becoming ever more important.

“Through this transaction, we aspire to bring together Quantium’s advanced analytics capability and Woolworths Group’s retail capabilities to unlock value across our entire retail ecosystem,” he said.

Woolworths is developing a retail ecosystem and opening up areas of its operations – including its store network, IT, supply chain, data, media capabilities and rewards programs – to third parties to accelerate growth.

For example, Woolworths is growing its Cartology media business by taking advantage of customer traffic instore and online, its stake in Quantium and data from its Everyday Rewards program to sell advertising to suppliers.

“By working better together, we aim to transform the rapidly evolving retail sector, helping us better service our customers and support our team and supplier partners,” Mr Banducci said.

Q-Retail will be led by Amitabh Mall, who joins Woolworths as chief analytics officer after 20 years at Boston Consulting Group, where he led the consumer and retail practice in the Asia-Pacific.

Quantium will continue to be run by the existing management team led by co-founder and CEO Adam Driussi and will continue to maintain agreements with clients in fast-moving consumer goods, banking, insurance, consumer services, property, health and government.

“We’re delighted to deepen our existing partnership with Woolworths, ” said Mr Driussi.

“This partnership enables Quantium to further build out our retail capabilities while accelerating our vision to be the world’s most respected and impactful data science and AI partner.”

This story originally appeared in the Australian Financial Review. Read the original story here.

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