By Andrew Geekie and Nick Huber
Big companies can grab the headlines when it comes to breakthroughs in business technology. But innovation is flourishing in British small and medium-sized enterprises too.
From a Scottish brewery whose sales have jumped 250 per cent since building its brand to a plumber tracking employees with satellite navigation, these businesses are using new business technology to boost sales, increase efficiency and cut costs.
Domino’s Pizza: Making innovation pay
The UK’s leading pizza delivery company, Domino’s, has been one of the biggest success stories to come out of the recession, experiencing steady growth that most businesses can only dream of. That success owes a massive thanks to the firm’s investment in business technology, allowing its numerous franchises around the country to improve their operations and sales.
Domino’s sales and marketing director Simon Wallis firmly believes that investment in business technology has paid off. “New business technology and innovation are critical to the way in which we operate,” he says. “From an operational perspective we embrace business technology to achieve some of the things that are really important to us, to deliver against the standards we set ourselves, particularly in the ruthless measurement of speed to get our pizzas out of the door as quickly as possible.
“Secondly, from a customer point of view, we use business technology to ensure that we’re available in the most convenient way for them to order a pizza.”
Domino’s has managed to turn the seemingly low-tech business of making pizzas into a 21st-century precision operation. “We first took the plunge into e-commerce in 1998, when we took around £100,000 a year,” recalls Wallis. “By 2000 sales were up to £100,000 a month. By 2003 it was £100,000 a week, and by 2006 it was £100,000 a night. We now take in excess of £200,000 a night through our e-commerce channel.”
Domino’s has also been quick to take advantage of social media, and now boasts more than 165,000 ‘fans’ of its Facebook page and 5,000 followers on Twitter. “We use those channels to help us promote the brand and engage with our audience to keep them up to speed with news and events,” explains Wallis.
For example, Domino’s recently ran an exclusive offer to launch a specialist pizza, the Spanish Sizzler. It was initially announced only to followers on Facebook, who could order the pizza at a discounted rate.
Increased orders via mobile phones is another target. “Making your local Domino’s store available in your pocket through our ‘app’ allows people to order anywhere at any time,” says Wallis. “Today, online sales account for a third of our total sales, but we see that increasing to two thirds over the next few years, with one in eight orders coming from mobile phones.”
Octink: Turning web traffic data into sales leads
Converting web clicks into sales is a challenge for all entrepreneurs. Knowing how many people visit your website can be useful for online marketing – but not nearly as useful as being able to identify who is browsing your site and for how long.
Octink, an award-winning display specialist based in Brentford, west London, uses website analysis software that notes the visitor’s Internet Protocol (IP) address – a unique number given to every computer connected to the internet – and works out the location of that computer (city and country).
The software, made by Trovus, can also detect which organisation the user works for. Better still, it lists which pages they visited on your website, as well as when and for how long they browsed. The software can also send email alerts to Trovus staff to let them know when a potential new customer is looking at the company’s website.
This has helped Octink gain a better understanding of its customers and tailor its marketing accordingly. For example, if someone visits Octink’s site twice a week over a six-week period and always views two services, Octink staff can contact the potential customer knowing that they have a potentially strong sales lead.
Knowledge of who is browsing their website and when has proved profitable as well as informative. The software provided a solid return on investment within its first year, helping Octink to secure around £200,000 of new business – around a quarter of its total sales.
“We are consistently converting £30,000 to £40,000 a month of completely new business from our website,” says Will Tyler, chief executive of Octink. “This is as a direct result of the informed decisions the Trovus solution allows us.”
Inamo Restaurant: High-tech ordering
Have you ever got fed up with waiting to catch a waiter’s eye to order your food or ask for the bill? One restaurant business has put customers in control through an innovative on-table ordering system that has helped to cut costs and increase sales.
In 2005, when young Oxford graduates Danny Potter and Noel Hunwick started a London restaurant, they based it on digital projection technology. Diners in the pan-Asian restaurant, called Inamo, place their orders through an illustrated menu projected onto their table.
Using this patented technology, customers can order when they want, get the bill and call for a waiter at the touch of a button. They can also view live pictures from the kitchen and order a taxi home.
Hunwick estimates that the electronic menus have reduced their staffing costs by up to 30 per cent – largely because the restaurant doesn’t need to employ as many waiters. The on-table menu system has also sped up service, helping the restaurant to serve more customers, and increased covers by 10 per cent compared to a traditional paper-based ordering system. “We’ve had great customer feedback in general,” he says.
Analysis of the menus and customer orders has also helped the restaurant gain a better understanding of customer choices. For example, Inamo managers were able to work out that customers were 50 per cent more likely to buy a small dish from the first 10 displayed than from the following 10.
This imaginative use of computer technology has been a major contributor to the restaurant’s success.
Pimlico Plumbers: Smart logistics
Plumbing is normally associated with U-bends and leaky sinks, not the latest business technology. But one company is bucking the stereotype. Pimlico Plumbers prides itself on the punctuality of its plumbers, but with a fleet of 140 vans to service the Greater London area, keeping track of its staff isn’t easy.
To help it meet this logistical challenge, all the firm’s vans carry GPS sat-nav systems. This ensures that the company’s call centre can keep track of where its plumbers are at all times. When an engineer becomes free they will show up on the system as a little red dot. The call centre can then help them to get to their next job as quickly as possible.
The system cross-references distance and geography, as well as road conditions, maintenance operations and traffic. Pimlico Plumbers says that using the GPS system has helped boost productivity no end.
“Put simply, we can do 8-12 per cent more jobs than previously,” says Charlie Mullins, MD of the company. “If you ask me it’s a no-brainer. And if you add in the 10 per cent or so we have shaved off fuel bills, it’s worth upwards of a hundred grand a year.”
The Hummingbird Bakery: Causing a flutter on Twitter
The Hummingbird Bakery is a privately held American-style bakery operating in the fashionable London areas of Soho, Notting Hill and South Kensington. All Hummingbird’s products — cakes, cupcakes, pies and brownies — are freshly baked by hand on site, and a delivery service is offered on its website.
The bakery has 14,000 active monthly users on its Facebook pages and 9,500 followers on Twitter. It uses these services to announce new products and specials, and to allow customers to leave feedback and ask questions about the bakery.
Assessing the financial benefits of social networking can be tricky, but Hummingbird says that Twitter and Facebook allow it to do things that would be impossible with conventional marketing.
“Our approach has not been driven by marketing strategy,” says Tarek Malouf, the bakery’s founder. “It has grown from modest roots, as a way of staying in touch with our customers. But social media is a fantastic way of engaging with a huge community and encouraging a level of advocacy that wasn’t possible before.”
Hudson Contract: SMS payroll
As the largest CIS (Construction Industry Scheme) payroll provider to freelancers in the construction sector, Bridlington-based Hudson Contract works with more than 1,400 construction firms.
The company used to issue payment advice by mail to more than 80,000 freelance operatives each week. This system had a number of drawbacks: postal costs meant that it was expensive, and the information was often out-of-date by the time it was received.
The company decided to update its payroll system by installing an interactive text-messaging service to deliver payment information in a more cost-effective and timely way. The SMS service allows Hudson Contract to send secure and timely text messages directly from a spreadsheet and receive all replies to a dedicated inbox. The company can also send daily earnings updates to its freelancers.
Since using the SMS service, Hudson Contract’s postage costs have fallen by 42 per cent and saved 28 staff hours per month. Another benefit has been a significant reduction in the payment enquiries to Hudson’s call centre from its freelancers.
Brewdog Brewery: Building customer base through social media
Since its launch in 2007 by James Watt and Martin Dickie, BrewDog has gone from brewing beer in a Fraserburgh garage to Scotland’s largest independent brewery. In the past year its sales have surged by 250 per cent and it now exports to 19 overseas markets.
The engine behind this rapid growth has been an idiosyncratic marketing campaign based on social media such as Facebook and Twitter. Loyal cyber fans of the beers have been behind a hugely successful word-of-mouth internet campaign. In the early days of the business, BrewDog struggled to gain a foothold in the local trade, with licensees and publicans unsure about moving away from traditional beer brands and styles. So the BrewDog founders turned to the web to prove there was a keen market, sending sample bottles to bloggers to review. Online praise for the beers (whose names include Sink the Bismark! and Total Nuclear Penguin) was spread further using the brewer’s Facebook site and Twitter.
BrewDog co-founder James Watt says the online buzz not only helped to kick-start the company’s success in the UK, it helped it to expand into the US and Scandinavia – its biggest export markets.
“The web has provided us with the perfect platform from which to not only raise awareness of our brand and product range, but also to differentiate ourselves and to empower our fans to spread the word,” he says.
As its reputation grew, BrewDog tried a new type of social-media marketing, developing video blogs using a hand-held camcorder. The videos regularly get more than 250,000 views, and have become a cult phenomenon.
In 2009, the company took things a step further, building a website for fans to buy equity in BrewDog. Under the initial public offering, 10,000 shares were put up for sale at £230 each. More than 1,350 people invested, raising £642,00 towards building a carbon-neutral brewery outside Aberdeen.
Addison Lee: Taxis at the touch of a button
Addison Lee is Europe’s largest minicab firm. Its CEO, John Griffin, has always believed in using business technology to put his company one step ahead of the competition.
“One of the most important decisions I ever made was to concentrate on IT,” says Griffin. “When I first started out in the minicab industry, I was told, ‘It’s too early to get into this sort of technology,’ and I replied, ‘No, it’s too late.’ I felt that we had to jump on the train otherwise we would miss it.”
Addison Lee’s innovations have included online booking, text messages for customers (telling them their cab is on its way, with the driver’s name and car registration number), and home-working technology for the company’s team of telephonists. The company has also carefully logged details of account holders’ top five locations to speed up booking.
Griffin’s latest innovation is a smartphone app, which he hopes will once again revolutionise the industry.
“If you have an account with us and own an iPhone, you can download our app,” he says. “The simple act of pressing a button on your phone tells us you want to be picked up. We will then send a car to your location, logged via your phone’s GPS system.
“It saves our customers time and effort, while freeing our staff to deal with customers who prefer to phone us.”
For more business advice and interviews, visit the RBS Business Sense website.
NatWest’s Bankline service puts you in control of your finances 24/7.