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Using big data means expensive loyalty card schemes and large teams of IT analysts, right? Wrong. In fact, small firms may be ideally placed to make use of it in running their businesses, says Jo Faragher
To many small business owners, ‘big data’ may seem like something only retail giants can manage, or conjure up images of rooms of supercomputers analysing massive volumes of data to find a cure for cancer. In reality, companies of all sizes generate huge amounts of data all the time, and by using the right approaches it’s possible to gain insights that will help your business.
Bernard Marr, Data Expert at insurance company Hiscox and head of the Advanced Performance Institute, believes many small businesses may be missing a trick by not making the most of their data. “Any small business not using it for decision-making or improving their operations could be left behind,” he says.
He cites a small butcher based in north London that had been affected by the arrival of a supermarket. As it was difficult to compete on price, the owner fitted inexpensive sensors inside the store window to monitor pedestrian footfall via people’s mobile phones. The findings proved the busiest time outside the shop was between 9pm and midnight, when passers-by were heading to, or leaving, two nearby pubs.
Using Google Trends, a free online tool, the owner investigated what popular food searches were, and decided to open for a few hours in the evening selling pulled pork burgers and premium hot dogs. “Now a significant chunk of revenue comes from this small opening slot and profit margins are much higher,” explains Mr Marr. “And they’re using up meat that they weren’t before.”
Despite success stories such as this one, it can be difficult to know where to start. But rather than amassing data simply for the sake of it, it pays to know your end-goal. “The best way to start is with your user case,” says James Blake, CEO and Founder of Hello Soda, a data analytics company. “Not all data will be relevant. If you’re a swimwear company, weather data’s important, but not if you’re a bank.” Take your customer database. How do people prefer to be contacted, and when?
In fact, small businesses arguably have the advantage when it comes to using data to come up with business insights: they already know their customers well, and are not bogged down by having to go through multiple levels of approval if they want to act. “One of the benefits of big data is that businesses can make decisions in real time,” explains Sue Daley, Head of Programme for Big Data, cloud and mobile at TechUK.
Your customer data – which could be from transactions, weblogs, social media interactions or GPS positions – is a start, but you can also amplify these findings by using publicly available data. “For example, [environment agency] Defra has just released thousands of data sets,” she adds.
Once you know the insights you’re after, how do you query that data? “First-generation business intelligence tools used to create reports, but they were complicated, and needed a budget and an IT department,” says James Eiloart, Senior Vice President for EMEA at Tableau Software. “Also, many companies have been doing this in Excel. While it’s great for some things, it’s not a tool that allows you to truly ‘see’ the data.”
There are several data analysis tools that help business owners to produce visualisations of what they need to know – for example, a chart showing times of the day when customers are most active –and these can help businesses to find ‘hidden truths’ in data, says Mr Eiloart.
There are also free tools such as Google Trends (which shows what people search for) and Google Analytics (which tracks website visits), and many suppliers offer free trials of their analytics software.
Some tools offer text analysis so you can see the themes that recur on your social media profile. Location profiling is another way to see where your customers come from – especially if location is important to your business.
There are some issues to be aware of when you start your big data journey, however. Data protection laws – which are in transition because of a new EU data protection framework – mean that, when collecting data from customers, it’s best to anonymise it or ensure it’s obvious how people consent to their data being used if it’s personally identifiable.
“You have to make sure consumers understand what you’re doing with their information – they don’t mind sharing it if they know it’s secure,” says Mr Blake. This process also helps to ensure the data is ‘clean’, in that everything is up to date. But don’t get too bogged down, warns Mr Eiloart. “If you wait until all of your data is completely clean, you could be missing out on opportunities,” he says. “Your intuition will tell you if something doesn’t make sense.”
This is the double-edged sword of working with data – things change fast, and it’s only going to get harder to keep up. At present, around 4 billion devices are connected to the internet and producing data. But as the ‘Internet of Things’ expands, this total will swell to 50 billion by 2020, predicts Cisco Systems. That’s a lot of data, but potentially also a wealth of opportunities – and small businesses are uniquely well placed to respond.
Small businesses should not be overwhelmed by big data, but just see it as a tool to solve business challenges,” believes Miriam Fois, General Manager for UK and Ireland at Wherescape, a data software company. The following tips can help to make it work for you:
Don’t ignore the hygiene factors. Smaller businesses may have less time to get things right, but that should not mean they skip things such as audit logging, documentation or checking comments
Don’t leave it all up to one person. With fewer resources, data analysis and warehousing can become one person’s job. But all users need to have access to the right data and a basic knowledge of how to use it, rather than putting all requests through the ‘data person’
Ask the right questions. The first question should be: what challenges are you looking to solve? Smaller businesses have the agility to act on these decisions and tweak their business processes accordingly
TechUK will be hosting a Big Data in Action roadshow in Manchester on 25 October, in conjunction with FSB. The roadshow includes speaker presentations, networking sessions and real-life case studies, showing how big data can be applied by business leaders to deliver real value.
To find out more and register, visit
This gives you access to a range of services to help you find new customers, build profile and deliver high quality integrated marketing campaigns.
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