Oracle Exadata and Allegro Group

1
O R A C L E E X A DATA C A S E S T U DY
Copyright © 2012, Oracle. All rights reserved. Oracle and Exadata are registered trademarks of
Oracle and/or its affiliates. Other names may be trademarks of their respective owners.

Allegro Group Saves Millions with
High-Performance Oracle Exadata Platform
Executive Summary
For Eastern Europeans interested in picking up deals on everything from cars to
cat-sitters to kitsch, the online marketplace of choice is Allegro Group. Each day,
over 114 international websites run by the Poznan, Poland-based company receive
more than 500 million page views and process hundreds of thousands of online
transactions. With 20,000 new visitors every day, Allegro Group now ranks as one
of the largest e-commerce site in the world.
Since 2008, Allegro Group has consistently delivered annual growth rates of 20% —
a traffic and transaction boom that has brought with it a corresponding 65% increase
in data growth. By 2009, however, the sheer volume of transactions and data coming
in from its far-flung websites began to overwhelm its legacy data management system.
Furthermore, the company had no centralized enterprise-scale data warehouse — just a
collection of data repositories — and routed all queries and reports through a specially
created team in its IT department. As Allegro Group describes it, the company was
suffering from “a variegated panorama of data and platforms.”
“We were in a ‘we don’t know what we don’t know’ situation,” acknowledged Rafal
Kudlinski, business intelligence manager at Allegro Group. “The problem we had been
facing was a complete lack of centralization — the data handling was not capable of
supporting fast, real time reporting and decision-making.”
In response, Allegro Group launched a full-scale examination of its IT architecture with
a view toward rebuilding it on a unified and centralized platform intended for long-term
scalability, performance, and flexibility. The chosen system was Oracle Exadata Database
Machine, an engineered solution that is an innovative and integrated high-performance
enterprise data warehouse solution that uses intelligent storage to dramatically boost
system speed and deliver extreme performance.
Allegro Group immediately began seeing major system performance gains with Oracle
Exadata, including a 48x improvement in query times, uploading times that numbered
in minutes not hours, and a 15x improvement in data access time. Mainstay Salire
calculated a range of financial and operational benefits from Allegro Group’s move to the
integrated Exadata-based system, including millions saved from user productivity gains,
About Allegro Group
Poland-based Allegro Group is the leading
e-commerce company in Eastern Europe
and the second-largest online Marketplace
in the world.
Headquarters: Poznan, Poland
Employees: 3,750
KEY BENEFITS
• 64% ROI in three years
• Positive net benefits within
19 months
• Total savings of $7.5 million over
three years
– $3.0M in user resource
scaling benefits
– $1.3M in estimated fraud
prevention benefits
– $2.0M in estimated revenue
growth (margin benefit)
– $600K in IT scaling
optimization costs
– $450K in estimated cost
reduction in the SEM
campaign spend
– $100K in hardware cost
avoidance
• 48x faster query run time
• 15x faster data access time
• Able to upload data every
24 hours

2
Oracle Products
• Oracle Exadata Database Machine
• Oracle Business Intelligence
Enterprise Edition
• Oracle Consulting
fraud prevention, due to centrally managed and viewed set of data versus disparate
systems, hardware cost avoidance, and annualized revenue-growth support.
According to the assessment, Allegro Group’s investment in the Oracle Exadata
platform is projected to achieve payback in just under 2 years — delivering a 64% return
on investment (ROI) in the first three years and total benefits of $7.5 million.
BACKGROUND
With over 114 websites in 13 countries, Allegro Group is the No. 1 e-commerce company
in Eastern Europe, combining the classified listings of Craigslist, the Marketplace
capabilities of eBay, the shopping cornucopia of Amazon, and the price comparison
information of Shopping.com with the payment processing and service options of PayPal.
Its 40 million users generate 500 million page views per day, making it one of the most
heavily trafficked sites in the world. And that traffic shows no signs of slowing. Each day,
20,000 new users flock to Allegro Group sites, an influx that has pushed the number of
daily offers beyond 20 million in 2012 — twice as many as the company had been handling
only three years earlier.
Welcome as this was for the bottom line, Allegro Group’s growth spurt also began to
magnify the signs of age and strain of its disconnected legacy data management system.
As Allegro Group readily acknowledges, the cumbersome, patchwork system was slow,
fragmented, inflexible, labor-intensive — and needlessly expensive. To guide the company
into the future, management needed fast, real time data and reporting on which markets
to enter and what products to sell. Instead, it frequently found itself on the receiving end
of conflicting reports that took days to generate — a situation that not only hampered
decision-making, but raised the possibility it could be missing emerging trends.
“Because of our rapid growth, our knowledge gap became too big,” said Wojciech
Szczesny, chief technology officer of Allegro Group. “In addition, it became more and
more challenging to manage this growing volume of information.”
“Because of our rapid growth, our knowledge gap
became too big. In addition, it became more and m
ore challenging to manage this growing volume of
information. Oracle Exadata changed all that.”
Wo j ciec h S z c z esn y, C TO , A l l egro G ro u p

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Rather than continue to invest in different types of hardware and software for each
website and country, Allegro Group opted to install a standardized, centralized data
warehousing and analysis system that would transform operations throughout the
company. Among its top priorities:
• Unite operations across all its websites
• Eliminate redundancies and inefficiencies
• Store and manage the expanding volume of data
• Generate useful, actionable business intelligence about its rapidly expanding
customer base
• Ensure massive scalability over time
• Provide flexible reporting and analytic tools like attractive, easy-to-use dashboards
• Give its customers the highest levels of service and protection against fraud
THE ORACLE EXADATA DATABASE MACHINE SOLUTION
Oracle Exadata Database Machine represents a breakthrough in information technology,
using an innovative software stack and unique architecture built on open standards.
The system combines servers, storage, networking, and software in a fully integrated
platform that delivers extreme performance, is hugely scalable, highly secure and
redundant, and less costly to operate.
Allegro Group deployed Oracle Exadata Database Machine Full Rack, which includes eight
database servers running Oracle Database 11g and Oracle Real Application Clusters on
Oracle Enterprise Linux; the solution also included 14 Oracle Exadata Storage Servers
connected via InfiniBand communications links. After testing business intelligence tools
from Cognos, Business Objects, and Microstrategy, Allegro Group decided to leverage
the integration benefits by going with a single vendor and selected Oracle Business
Intelligence Enterprise Edition (“OBIEE”).
As Allegro Group observed, the result of the switch was significantly faster performance
for query times, data access, and report turnaround times, among other benefits. “All I
can say is that never in my life have I seen a database responding and retrieving so fast,”
Kudlinski said.
Because all of the core system components were built from an integrated Oracle
technology stack, deployment was straightforward. Using only a small team of internal
database administrators and consultants from Oracle and its partner ISE GMBH Germany,
the system was up and running within seven months in 2009, including uploading over
9 TB of data from the old system and a business-critical table with more than 2 billion
records.

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OPERATIONAL AND FINANCIAL BENEFITS
Directly after moving to the Oracle platform, Allegro Group began to see an array of
operational and financial benefits, ranging from million-dollar cost optimization savings
to a nearly 100% boost in query-response time. From a strategic perspective, Exadata has
given the company the foundation it needs to support its massive data requirements and
expanding customer base; boost loyalty by giving customers more services and greater
fraud protection; and provide accurate, real-time data for well informed decision-making —
all while substantially lowering costs.
Specifically, Mainstay Salire found that the company would achieve the following
aggregate benefits over three years:
• $3 million in savings as a result of business-user scaling
• $648,000 in IT resource scaling optimization
• $1.3 million in fraud prevention savings
• $450K in estimated cost reduction in SEM spend
• $100,000 in hardware cost avoidance
Operationally, the company achieved immediate improvements in query run time
(48x improvement) and data access time (15x faster), and gained the ability to upload
production data daily.
The company found the changes nothing short of remarkable. “We now have accurate figures
on a daily basis,” said Szczesny, Allegro Group’s CTO. “This simply wasn’t possible before.”
Supporting Growth of Queries and BI
The move to Oracle Exadata enabled Allegro
Group to improve its query run time by 48x ,
as shown in Figure 1. “A query that used to
take 24 hours to complete now runs in less
than 30 minutes on Oracle Exadata — and
that’s without any manual query tuning,” said
Kudlinski, Allegro Group’s BI manager. Tables
containing more than 4 million records each can now be aggregated and summed in less
than 20 seconds. Meanwhile, the Smart Scan feature of the Oracle Exadata Storage
Servers works so fast that Allegro Group has done away with many of its indexes.
In the past, Allegro Group could only offer its business users simple Web reports and
statistics — on spreadsheets. Now that production data can be uploaded every 24 hours,
Allegro Group generates new reports and statistics each day and posts them online for
easy access. “Business users can drill down into data details and slice and dice the data
however they want without requesting IT support,” CTO Szczesny said.
Figure 1: Reduction in Query RunTime
24 hours
< 1 hour
Exadata
Legacy
“We now have accurate figures on a daily basis.
This wasn’t possible before.”
Wo j ciec h S z c z esn y, C TO , A l l egro G ro u p

5
The following charts show the increases in total queries, ad hoc queries, and business
intelligence reports in the Oracle Exadata environment.
Figure 2: Growth inTotal Queries
Figure 3: Growth in Ad Hoc Queries
Figure 4: Growth in BI Reports
Aug.
2009
Nov.
2009
Feb.
2010
May
2010
Aug.
2010
Nov.
2010
Feb.
2011
June
2011
Aug.
2011
Nov.
2011
Jan.
2012
0
20,000
30,000
40,000
50,000
10,000
60,000
70,000
80,000
Queries
6,266
13,811
20,581
22,159
36,460
40,400
45,404
50,000
51,000
57,000
67,000
0
10,000
15,000
20,000
25,000
5,000
AnalyticQueries(ad-hoc)
2,294
5,318
7,338 8,238
13,065
14,344 15,257 15,700 16,700
18,300
19,600
Aug.
2009
Nov.
2009
Feb.
2010
May
2010
Aug.
2010
Nov.
2010
Feb.
2011
June
2011
Aug.
2011
Nov.
2011
Jan.
2012
Aug.
2009
Nov.
2009
Feb.
2010
May
2010
Aug.
2010
Nov.
2010
Feb.
2011
Est.
2012
0
10,000
15,000
20,000
25,000
5,000
30,000
35,000
40,000
BIReports
3,972
8,493
13,243 13,921
23,395
26,056
30,147
35,000

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15x Faster Data Access
Oracle Exadata also improved the overall flexibility of its IT department and allows Allegro
Group to more intelligently deploy its IT resources to strategically support core business
initiatives. Also, because its pre-Exadata environment had no enterprise data warehouse,
all data and report requests were routed through the IT department. It was a roundabout,
inefficient process that took anywhere from 30 minutes to three days before
management or researchers could see the results.
“Now reports are available immediately or
can be accessed in one to two minutes,”
Szczesny said. “And it has completely
reduced the burden on the IT department.”
The improvement in reporting speed is
estimated to be 93% faster than
previously.
Estimated $2M in Revenue Growth
Allegro Group is also expected to realize an estimated $2 million in annualized revenue
growth due in part to its use of Oracle Exadata to offload data processing from the
database server to storage. As a result, Allegro Group can process queries significantly
faster and provide business users with a range of capabilities to optimize revenue and
margins. For example, the Exadata environment has enabled Allegro Group to beef up
its business intelligence portal with hundreds of new reports for each business line,
from general KPIs (key performance indicators) to detailed analysis. Analysts can now
do weekly clickstream analyses, monitor the value of cross-selling activities, and stay
on top of customer buying trends.
The additional analytical capacity is also facilitating faster price changes, supporting the
company’s “allegro standard” program and enabling the fast distribution of personalized
newsletters and recommendations. All of these reporting and marketing enhancements are
conservatively estimated to contribute at least $2 million in additional revenue per year.
$1.3M Fraud Prevention Benefit
Allegro Group also boosted its ability to quickly detect and abort potentially fraudulent
transactions — one of the biggest headaches of large e-commerce sites. Furthermore,
refunds are now instantaneous, relieving customers of any concerns about collection
or losses. “Real-time data is now available, bringing immediate visibility to suspect
transactions,” Kudlinski said. “Every transaction is now secured, so users of Allegro
Group are 100 percent protected.”
Figure 5: Faster Data Access
1/2 hour
2 minutes
Exadata
Legacy

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$450K Savings in Search Engine Marketing Program
Exadata-driven real-time reporting also gives Allegro Group the ability to calculate
and immediately adjust its spending on search engine marketing (SEM) campaigns1
,
which is helping the company optimize its SEM budget — and avoid unnecessary ad
purchases — by focusing on the highest-performing products.
$3M in Productivity Gains
Thanks to the new flexibility and scalability of the solution, Mainstay Salire has calculated
that the Allegro Group will save $1 million annually through user productivity gains. Today,
Allegro Group’s managers, various research departments, and other key users have direct
access to the data warehouse as well as its full cache of querying tools and features and
all the data interfaces. The combined performance advantages of the solution means that
Allegro will more quickly deliver accurate customer data and complex market analytics
into the hands of decision makers. Thereby enabling them to capitalize swiftly on market
shifts, respond to customer preferences and demands, and create precisely targeted
campaigns and product offerings.
“After so many years of fragmentation, managers are now able to strategize by product,
region, user group, and category,” Szczesny said. “Every product functionality leader has
immediate access to the data they need.
“Let’s say you have a new payment channel,” the CTO continued. “Leaders have
immediate visibility into how users have utilized the channel and how much they
should optimize earnings for that channel. It’s fast, clear, clean, and direct.”
Over $200K in Annual IT Resource Scaling
Historically, Allegro Group maintained a full-time, six-person team of IT programmers at its
Polish headquarters to field and respond to report service requests from its international
operations. Requests ran the gamut from running queries on the production system and
conducting ad hoc queries to aggregating each day’s batches and dealing with queries
that required action. With Oracle Exadata, Allegro Group was able to redeploy the team
to focus on more strategic projects, saving over $200,000 per year.
1
One example of a SEM program is Google AdWords, which provides pay-per-click advertising, cost-per-thousand
advertising, and site-targeted advertising for text, banner, and rich-media ads.
“All I can say is that never in my life have I seen a database
responding and retrieving so fast.”
R afa l K u d l inski , b u siness inte l l igence D irector ,
A l l egro G ro u p

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$100K Saved on Hardware
As shown in Figure 6, Allegro Group is projected to save $100,000 in hardware cost
avoidance thanks to the massive capacity and scalability of Oracle Exadata. Despite
a 64% rise in data since 2007 — from 9 TB to 25 TB in 2011 — Allegro Group will be
able to accommodate that growth with no additional outlays for hardware.
Supporting Business Growth
Oracle Exadata is not only helping to support Allegro Group’s explosive growth in page
views and transactions, it is also supporting growth on its business side, which has risen
20% as a direct result of all its new Internet services, acquisitions, and incoming data
sources. By allowing Allegro Group to track what users view and what they are interested
in, Allegro Group can more effectively shape personalized marketing tools like e-mail
blasts and newsletters around user behavior rather than just transaction activity.
Business users also now have an array of flexible reporting tools to choose from,
including sophisticated dashboard functionality. Furthermore, the integrated capabilities
of the system encompass a range of business essentials such as planning departmental
budgets, workforce scheduling, sales territory assignments, and any other activities that
require “what if” modeling.
“If we had to do the entire data mapping, modeling, and transformations ourselves,
it would probably take three or four times longer than it took to implement the entire
prebuilt Oracle business intelligence and data warehousing solution,” Szczesny said.
Figure 6: Data Growth
9
14
20
64%
25
0
10
15
20
25
30
5
Terabytes(TB)
2009 2010 2011 2012
(est.)

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Copyright © 2012, Oracle. All rights reserved. Oracle and Exadata are registered trademarks of
Oracle and/or its affiliates. Other names may be trademarks of their respective owners.
ABOUTTHIS CASE STUDY
Research and analysis for this study
was conducted by Mainstay Salire,
an independent consulting firm,
drawing from interviews with Allegro
Group employees, review of planning
documents and searches of industry
literature. ROI calculations use
industry-standard assumptions
regarding the time value of money.
Mainstay Salire is the leading
provider of independent value
assessment and IT strategy services.
For more information, please
visit www.mainstaysalire.com.
Information contained in this case
study has been obtained from sources
considered reliable but is not
warranted by Mainstay Salire.
2929 Campus Drive, Suite 150
San Mateo, CA 94403
650.638.0575 ph 650.638.0578 fx
www.mainstaysalire.com
BENEFITS SUMMARY
According to Mainstay Salire’s projections, Allegro Group’s investment in the Oracle
Exadata platform is expected to generate total business and IT benefits of approximately
$7.5 million over three years, as shown in the chart below. The largest portion of the
benefits will come through better analytical capabilities; faster querying; having a single,
unified data management platform throughout the enterprise; and being able to quickly
and accurately disseminate information for more effective marketing and product
selection. The Allegro Group will break even on its investment within 19 months,
and is on track to earn a 64% ROI over a three-year period.
Figure 7: Benefits by Category—Three-year View
Hardware
Cost
Avoidance
Improved IT
Resource
Optimization
$0.1M
$0.6M
$0.5M
$3.0M
$2.0M $7.5M
$1.3M
Report
User Staff
Productivity
Optimization
Fraud
Prevention
Benefits
Adword
Campaign
Cost
Optimization
Incremental
Revenue
Impact
(profit
margin only)
Total
Benefits

Oracle Exadata and Allegro Group

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