Ramón Romero Pérez, Head of Global Supply and Facility Management at Bigpoint - Sourcing as a strategic lever


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Ramón Romero Pérez, Head of Global Supply and Facility Management at Bigpoint spoke at the SCL Event July 2013

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Ramón Romero Pérez, Head of Global Supply and Facility Management at Bigpoint - Sourcing as a strategic lever

  1. 1. Sourcing as a Strategic Lever Ramón Romero Pérez Head of Global Supply and Facility Management (GSFM) Supply Chain & Logistics Event Heathrow, July 10, 2013
  2. 2. 2 Bigpoint is a three-digit million Euro (in revenue) company which offers browser-based online games Company overview • Developer and publisher of browser-based online games • Founded in 2002 • Three-digit million Euro sales in revenue • More than 700 employees worldwide in 10 local offices (HQ in Hamburg, Germany) • Acquired in 2011 by Summit Partners and TA Associates for US$ 350 mil. Total market for online games is US$ 19 bn. and growing by more than 15% annually Selected products
  3. 3. 3 Manage your own farm and perform all activities: cultivate products, harvest products, sell products Objective of the game Free to play The game can be accessed through browser and played for free (even to advance you do not need to pay) Voluntary payment If players want to advance faster in a game or buy improved or customized features (e.g. fertilizer, additional workforce for harvest season, seeds for exotic products), they can pay for it Business model: “Free to play – voluntary payment” Revenue is generated through “virtual products”
  4. 4. 4 10 local sales offices 1,000 media partners 30,000 affiliate partners Worldwide distribution through local sales offices and more than 1,000 distribution partners
  5. 5. 6 What does a company like Bigpoint purchase actually? – 60% is spend related to IT and Marketing Marketing (~40%) IT (~30%) Production (~20%) Other • Hardware • Software • Hosting services • … • “Classical“ Marketing (Agencies, TV spots) • Digital Marketing (SEM, SEO, Social marketing) • Marketing consulting • … • Art/ Sound services • Programming • … Sub-categories Typical challenges • Financial services (Audit, Tax, etc.) • … • „Online marketing“ is a very new discipline (SEO, SEM, social) – is it going to substitute or complement „traditional“ marketing • Costs of online marketing have quadrupled during the last years – so has marketing‘s effectiveness • Right technology for managing large amount of data (“Big Data“) • Connectivity to new markets (e.g. BRIC) • Virtualized vs. Stationery infrastructure • Many services/ products/ vendors are very new – who is there in the next five years • Vendors lack often structures – who are the right ones to support growth Main categories (% of spend)
  6. 6. What is the Strategic Value of Sourcing? 7 Costs and Cash optimization Innovation Sourcingasstrategiclever 3 Revenue generation Cross-functional collaboration 2 1 4
  7. 7. Optimization of Costs and Cash is bread and butter business in Sourcing – and helps to show tangible results 8 1 Cash Costs Alternative to reach cost and cash optimization are often more difficult and painful to achieve • … Reduction of labor costs? • … Increase of end product prices? • ... Higher utilization? Sourcing
  8. 8. Sourcing as a “Revenue-generating“ discipline2 • Bigpoint cooperates with more than 1,000 media partners, TV stations, cable networks worldwide • Media partner provide free media spots or digital marketing • Bigpoint’s payment is subject to revenue share Media spots/ digital marketing Revenue share
  9. 9. Sourcing as an enabler for innovation 10 • Bigpoint has “zillions” of static and dynamic user data - minute by minute, day by day • Bigpoint lacked technological capabilities in order to manage these data • In a innovation partnership, new technology to analyze existing customer data in real-time was applied to Bigpoint • 330 mil. user • “Zillions“ of static and dynamic user data Co-innovation project on BIG DATA with leading IT software provider 3 + = Real-Time Analysis • Dynamic Pricing: • e.g. one-time price discounts for products • Real-Time, customized offers: • e.g. another feature/ product if customer is signaling to quit a game
  10. 10. Sourcing as enabler for “Cross-collaboration“ 11 • Bigpoint submits more than 30 mil. emails to users per day (no SPAM!) • These emails are either for based on CRM activities (e.g. newsletters) or system emails • In order to submit, emails more efficiently, an external provider was selected involving several stakeholders with diverse interests Marketing IT Finance Legal 4 Procurement Manages stakeholder, interests and “bring people together“ Good solution Stable system Cost and cash efficient Major interest Complies with data security
  11. 11. 12 • Costs and Cash Optimization are a basis • Sourcing is a Strategic Lever beyond cost and cash optimization … • … because it can contribute to Revenue • … it helps to identify suppliers for leading-edge technology • … it supports cross-collaboration within an organization Key learnings Summary
  12. 12. Find us on Bigpoint GmbH Ramón Romero Pérez Head of Global Supply and Facility Management Drehbahn 47-48 20354 Hamburg Germany Tel +49 40.88 14 13 - 223 Fax +49 40.88 14 13 - 11 r.romero@bigpoint.net www.bigpoint.net For any questions, please do not hesitate to contact me 13