Mapping Out Marketing on Computer Screen : Software: Small businesses are getting help with decisions from systems that render complex data into easy-to-use maps.
Like most entrepreneurs, Bill Wood is always eager to drum up business, open branches and, of course, boost revenue.
But not everyone faces Wood’s obstacles: He runs an employment agency in a city with one of the nation’s lowest jobless rates. Worse, there are dozens of competitors hunting for a shrinking number of heads.
Still, Nashville-based Wood Personnel Services managed to fill about 25% more jobs this year and soon plans to open another office in town.
Wood says he owes it all to his personal computer, or rather an evolving breed of mapping software technology known as Geographic Information Systems, or GIS, that allows him to wage some technological warfare against the competition.
“Temporary workers are our product. We were able to identify through the software where the temporary workers who would use our service lived in Nashville,” Wood said. “From there, we were able to set up recruiting sites. We knew what community newspapers to place ads in.
“We had to do something. Unemployment rates were plummeting so much; they were as low as 1.9% here this year.”
Although still largely unknown, GIS software is steadily making its way from the highest echelons of government and business, where it has been used for more than a decade, to the back offices of mom-and-pop organizations like Wood’s 24-person agency. The technology actually was developed about 25 years ago to record environmental changes over large geographic areas and time.
What makes GIS so appealing to businesses is that it allows them to take a multitude of data that are geographically distributed, from proprietary sales information to Census Bureau statistics, and view it all on a colorful, layered map that’s far more appealing than an ordinary work sheet of numbers.
With a few keystrokes, organizations can undertake relatively sophisticated geo-strategic planning--from pinpointing where to open stores or mail advertising flyers to deciding what products and services to offer. They can locate concentrations of ethnic groups or affluent families, even get a handle on household sizes or neighborhood traffic patterns.
It’s probably no whim when a restaurant chain decides to offer more culturally diverse dishes in a particular region or when a major retailer agrees to open a branch at a new mall.
“This [software technology] is an extraordinary way to assimilate huge amounts of information. We can make a single map from 60 pages of tabular information,” said Scott Elliott, president of Wessex, a Winnetka, Ill., company that publishes the First St. GIS program.
First St. includes, among other things, software from top GIS developer Environmental Systems Research Institute Inc. of Redlands, Calif., 1990 national census data and electronic street maps on its 22 CD-ROMs.
Other industry pacesetters include Strategic Mapping Inc. of Santa Clara, Calif., and MapInfo Corp. of Troy, N.Y.
Rapid technological advances, which have brought down PC prices, also have made it easier and cheaper to produce this complex software. Computerized mapping data that cost tens of thousands of dollars just a few years ago now typically go for between $400 and $2,000, and software publishers say that prices are poised to fall even further next year. (At least one related product, BusinessMAP by ESRI, was just introduced with a $99.95 price tag.)
Don Hemenway, editor of the monthly publication GIS World, predicts the $500-million market, which includes about 250,000 PC and Mac desktop users, will grow to millions of users by the end of 1996 as more organizations invest in the latest computer hardware.
“More businesses can afford to buy a Pentium [chip] machine . . . which can do 10 times what a mainframe could do 10 years ago,” Hemenway said. “GIS is very computing-intense. It needs that power to drive the graphics [and] the large databases.”
Hemenway says he also expects the GIS products, some of which can be somewhat difficult to understand and tricky to use, to become more user-friendly.
“If you look at them, they’re not really simple programs,” agreed First St.'s Elliott. “Ninety-five percent of the users . . . use less than 5% of the functionality. While there are all these whizzes who can make the programs stand on their heads, most by far are people who can copy roads, columns, maybe bring up a bar graph. We’ve got to do better.”
While most GIS products are not widely distributed (they’re usually sold only directly by their publishers), there is a movement toward the mainstream.
Software leaders, such as Lotus Development Corp., Microsoft Corp. and Novell Inc., have included or plan to bundle mapping features into their spreadsheet and office suite programs. Using OLE support technology--short for Object Linking Embedding--users can pick up a map and drop it on a spreadsheet or report.
These bundled programs are in addition to the rising number of stand-alone GIS programs, with names like First St. or Maptitude, that include various databases or others designed to work with add-on mapping and statistical packages from smaller, private companies.
Demographic data is sold on computer disks and CD-ROMs by market research firms, yellow pages publishers, credit bureaus and the U.S. government.
Wood said that by using the GIS software Maptitude, he was able to ascertain enough information about household income, race and employment status among residents in the Nashville area to help with his recruiting efforts. The more temporary employees he finds, the more jobs he can fill and revenue he can generate.
Maptitude, published by Caliper Corp. of Newton, Mass., is among the least expensive GIS products at a cost of $395, and probably among the easiest to use. Its MapWizard feature automatically creates a standard map that can be customized.
Before using GIS software, Wood said, he was forced to do all of his market research in very low-tech fashion.
“I’d have to send someone to the library to do all this statistical research, and it would often take hours. Then using that information . . . we’d color-code several maps by hand and try to layer them. It would sometimes get confusing,” Wood said.
Robert J. Wilkening, president of Wilkening & Co., a Park Ridge, Ill., management consulting firm, says GIS software also has made his work easier.
“It gives us the ability to go to clients and do things important to them that we could never have done before,” said Wilkening, who uses the First St. program.
Just recently, Wilkening said, he was able to help an industrial client reduce spending among its sales force by redesigning sales routes to minimize travel. He was asked by another potential business client for suggestions on where to open another carwash.
“Any business can use this,” he said. “The smart mom-and-pops are going to win.”