Census data adds up for business

Census data is being leveraged by an increasing number of businesses worldwide and the downturn in some industries is actually driving more data-informed decision making.

The first lava flows from the ABS’s mountain of data collected at last year’s census will trickle out to Australians today with businesses to be among the keenest to seize on the figures.

Businesses have increasingly used information from the once-every-five year survey to identify the key demographics in the marketplaces they serve and wish to serve.

The 2011 results are set to improve on the accuracy of 2006 by offering individual stats for more tightly defined sections of the map, with the number of "collector districts" rising 30 per cent, from 36,000 to 47,000 (now to be called a "statistical area one").

The data will also offer more variables per person, about 400 per SA1, rather than per household as in previous censuses.

As such, businesses will be able to identify more key factors about even smaller mini-marketplace areas.

Basic information includes individual incomes, gender and age ratios, ethnicity, while there is more subtle data like "working populations" which defines where people spend the day as opposed to where they sleep.

While census data is a tool that is being taken up by an increasing amount of businesses worldwide, there are still many medium sized and particularly smaller firms in Australia that rely on the "gut feel" method of understanding their marketplace, according to one of Australia’s leading business analytics consultancies.

"Even now, there are a massive number of businesses who are still not using this data, they’re using gut feel. They’re basing it on ‘my mate down the pub said this’,” Pitney Bowes Software director of product management Sean Richards says.

"But this information gives organisations a perspective on the markets that they serve, and where they can find those clusters of high market potential.”

Richards, whose firm tailors census information (usually combined with other data sources such as rezoning plans, car space availability, customer data, etc) for thousands of Australian businesses, said the census information is becoming more and more valued, evident by the take-up in countries such as the US where prolonged downturns are strangling business marketing budgets.

"We’ve observed some substantial downturns in US markets over the last five years but we’ve had some of our best growth in the sector in the US because you have retailers with extensive networks having to rationalise,” he says.

"Here, we’ve seen steady growth in recent years despite the dire situation in the retail sector.

"If any business has aspirations to grow, you don’t have a lot of fat in the market to compensate for bad decisions. That demands informed decision making because the consequences are massive.”

Among the success stories for Pitney Bowes Software's clients was handyman franchise Hire A Hubby. The fledgling firm approached Pitney Bowes in early 2008. Using the data processed it was then able to offer potential franchisees a gold, silver or bronze rating for territories, with minimum income guarantees attached to each.

"That’s changed everything about what they can command for their brand value through franchise license fees – trust and confidence was the biggest challenge they had,” Richards says.

"But with these guarantees budding franchisees can leave their day jobs and try something they’ve really dreamed of doing and feel a level of confidence that they’re not going to put their family on the street.”

Richards, whose company projects the figures out to provide year on year estimates and so forth, said the information, which contains 30,000 variables, could be arranged in levels of details from the extreme to the most basic overview of population, household expenditure and income.

"There is a mountain of data but there’s no need to fear it," he says.

"And there’s no need to delay getting it. It’s free online."

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