Data and analytics are driving business location decisions...
More than ever before, data and business intelligence are driving strategic corporate decision making, as businesses seek to minimise costs and risks and maximise performance and profits. Today, large businesses are utilising sophisticated 'analytics' - information resulting from the systematic analysis of data - to develop their strategies, and the potential to apply analytics in the area of site and location selection is increasingly being recognised. According to a recent report by Jones Lang Lasalle, 'there is a significant opportunity to apply analytics in portfolio and location strategy.' (Beyond Data: the opportunity for analytics in CRE, JLL, Sept 2014).
But even businesses without access to sophisticated analytics tools want reliable property and location data and intelligence, addressing key site selection criteria such as building rental costs, workforce demographics and transport connectivity. Their analyses may be less in-depth, but the same needs and principles apply.
...and the internet has empowered investing businesses...
The rise of the internet has, of course, made it far easier for businesses to access location and site data from an almost limitless number of sources. And - as with all buyer-seller relationships - it has transformed the relationship between investing businesses and the investment promotion and property agencies that are trying to sell them locations and properties.
Put simply, it has empowered the businesses - the buyers - because if they don't trust the data the location and site sellers are offering, they'll just find more trustworthy data elsewhere, at the click of a mouse. They'll be gone, along with their inward investment projects.
The data opportunity for Investment Promotion Agencies
But the rise of the internet, and the data it makes available to investing businesses, can present big opportunities for investment promotion agencies too. It's just that the rules of 'selling' have changed completely. The old sales techniques of spinning data to produce the best possible (albeit fake!) numbers simply don't work anymore. But if agencies help businesses by providing the reliable, accessible data they're looking for to make informed location decisions, businesses are more likely to trust them, utilise their data, and shortlist their locations.
What Investment Promotion Agencies need to do...
And if investment promotion agencies find that the genuine data suggests businesses would be better off investing elsewhere, it means reviewing their priority industry sectors and their location value propositions. Because, one thing's for sure, every location has the potential to present a powerful inward investment proposition to businesses without faking the data. It just requires communicating the right location solutions to the right types of companies.
Nick Smillie
MD, Clarity Business Strategies Ltd.
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