In an increasingly online business environment, being able to spot trends and discern patterns in the wealth of data is becoming critical for success
NOT ONLY does business analytics help companies recognise trends and patterns, allowing them to improve their business, it can also be used to identify potential business opportunities.
Gone are the days of needing a unique product idea to set up a new business. Aspiring entrepreneurs can now cash in on trends and market demands with the help of online databases and analytics.
People can go behind the scenes of Google to see what is being searched for, and what products are most popular, thus identifying new business ideas, according to Shane Nolan, country manager for Google in Ireland.
“Furthermore, tools such as Google Insights and Analytics are vital for businesses to ensure they don’t miss a potential opportunity. Without them, it’s really difficult to gauge how well your website is doing. There is an element of blindness to marketing and advertising offline, but online you can see data instantly.”
Voltaire Diamonds founder Séamus Fahy opened a London office earlier this year after discovering through Google Analytics that his business website was receiving a lot of hits from England’s capital.
Google Analytics helps business owners to see how many customers their website is attracting, where the customers are from, how users are engaging with the site, which parts of the site are performing well and how visitors interact with sharing features.
“When I set up the Voltaire Diamonds website I signed up to Google Analytics so I could monitor hits to the site. I could see 10 per cent of hits were coming from the UK, particularly London, so decided to open an office there and we’re doing very well,” he says.
Fahy uses Google Analytics to see how many visitors he gets to the website, where they are from and what they are most interested in.
“I think the hits we were getting from London were mostly Irish people as they were searching for things like ‘engagement rings Dublin’ and getting to my site from that.”
People can also find business ideas by looking at top searches on Google with the help of Google Insights, and identifying what’s trending/popular, according to Ciaran Buckley, head of marketing and strategy at Farrelly Mitchell business consultants.
He believes the identification of trends in business is the key to entrepreneurial success.
“Steve Jobs could see trends in computers and what was going to last. The same goes for Michael O’Leary. He realised that down the road people would treat planes like a bus – they would want to use them often and cheaply.
“Anyone can have a business now,” he says. “Before, we used to think in bricks and mortar – you weren’t a retailer unless you had a shop in a building. People are turning towards internet shopping more and more though and web-based businesses are becoming more popular. The thing about them is you don’t need a completely new and unique idea to set up an ecommerce business.
“Ireland is ranked high on the world index of ability to set up new businesses. However, a lot of what holds us back is the cost of labour and buildings such as rent and local authority rates. The beauty of internet-based businesses is you don’t have to worry about these and you can reach a larger audience too.”
Buckley says taking advantage of trends online will become a bigger and bigger business in years to come, as web-based businesses become more popular.
“Right now people go to the supermarket to do their shopping, but there is no reason for them not to do their shopping online, as they know what they want and delivery is free most of the time.
“They don’t, possibly due to habit and sociability, but this will probably change. The same goes for landlines. The younger generation all have mobile phones and don’t even consider getting landlines.”
Venture capitalist Brian Caulfield, a partner at private equity firm DFJ Esprit, makes it his business to look for new trends and understand market needs.
“We put a lot of time and effort into tracking what areas are trending. You have to be clued into the areas you invest in. I don’t know how someone can invest in social media if they are not on Twitter and Facebook.”
He believes analytics are “immensely important” for businesses to validate their proposition. “They say only half of advertising works, but you don’t know which half. Analytics helps you identify which half.”
ANALYTICS IN ACTION: RONAN O'BRIEN, FOUNDER AND CHIEF EXECUTIVE ZATORI RESULTS
SERIAL ENTREPRENEUR Ronan O’Brien has successfully capitalised on the popularity of online shopping by creating a number of e-retailing businesses around customer’s internet searches.
The chief executive of Zatori Results develops businesses off a simple concept. Identify what customers are searching for online, offer them those products and allow them to purchase there and then.
“We’re not trying to create demand for a particular product and we haven’t brought out any new products. We just see which markets are hot at the moment and capitalise on them,” he says.
O’Brien uses Google’s Keyword Tool and databases to identify what the public are searching for online, and what countries they are searching for those items in.
The simple model has proven to be fruitful for the Laois-based entrepreneur, who has launched 10 internet-based companies in the past five years. These include thecostumeshop.ie; thebikinishop.ie; Mollys.ie, an online retailer of pet products; themobilityshop.ie, which sells wheelchairs and mobility aids; and marineelectronics.eu, all under the Zatori umbrella. Last year, the business recorded a combined turnover in excess of €2 million.
O'Briens latest venture, BuyTrophies.ie, was launched earlier this year and supplies trophies and medals to schools, clubs and societies. The 29-year-old is now launching clothing.ie. Members of the public can buy a few items from the site, which will sell branded clothing by designers such as Calvin Klein and Tommy Hilfiger, try the items on and only keep the items which they like.
“Using Google databases, we found out which brands Irish people were most interested in and searching for most online. We then approached those brands so we could sell them on our site.
“Often people are put off buying clothing online as they can’t try on the items. Some companies allow customers to post items back within a certain time period, but by the time the customer gets around to posting the items back, the time period has passed. We will send a courier to pick up the items a customer doesn’t want, making it easier for them.”
The concept behind the BuyTrophies website, which is launching in the UK next month, is also to make the customer experience easy.
“We do the trophy engraving onsite, so people don’t have the hassle of trying to find jewellers to get the engraving done.”
O’Brien has 20 people employed full-time at his base in Portlaoise and is currently recruiting a further 100 people on a seasonal basis as the run-up to Halloween is the busiest time for his costume shop business, which is the most successful arm of the Zatori operation.
O'Brien, a finalist in the Ernst Young Entrepreneur of the Year award, started thecostumeshop.iein 2007 to win a bet with a friend, when they both needed costumes for a gig.
“We couldn’t find costumes anywhere and my friend said someone should be doing them. I bet him I could. I won the bet and got a company out of it.”
Thecostumeshop.iebegan life as a part-time operation that supplied high-quality costumes to the fancy-dress and party markets. Following on from its success in Ireland, Zatori has launched online costume businesses in a number of other markets internationally, including Great Britain and India.
He went on to form thebikinishop.iein the summer of 2008 as costume sales are usually quiet coming into summer.
“I noticed a female friend had to buy two bikinis as the shops did not sell separates and she was not the uniform one size. I thought this was crazy, so set up a site selling separates.
“A lot of our business comes from the US, which is rare for a .ie domain name. We have Hollywood celebrities and their stylists ordering from us. It’s funny as the bikinis come from LA to begin with, people over there order them from us, and then we ship them from Ireland back to LA.”
