Simon Menashy, investment associate, MMC Ventures
Consumer-facing digital business is getting a lot of attention these days, and rightly so. Across social, digital media, e-commerce and other sectors, consumers are voting with their thumbs and mice and metrics are on the rise. Newspapers’ digital revenues are becoming significant, 15-20% of UK retail happens online and it is now normal to turn to the web for everything from insurance to holidays. For the consumer, services are becoming faster, more relevant and generally less hassle.
But what is powering this? Behind the scenes, the smartest companies are using data to make decisions around how their sites are designed and navigated and how best to target content and offers. It’s all in the name of increasing conversion.
Some of the most successful data-driven businesses have built their own analytics capability – leading companies such as Expedia and Amazon have measurement and iteration built into their DNA. For others, Google Analytics provides enough detail. But there is a growing group in the middle who are becoming more sophisticated around data, often hiring analysts and data scientists, but don’t have the resources to create their own infrastructure.
A new generation of specialist digital services providers are springing up to fill this gap, and venture funds are taking notice. Whether it’s helping to understand consumer data, surface ‘warm leads’ or layer in social features, B2B digital businesses are hot.
At MMC Ventures we are excited to be backing iJento, together with Nauta Capital and Oxford Capital Partners. iJento’s technology helps brands such as FT.com and Cheapflights to understand and optimise the journeys their customers are taking through the web and other channels to get to a purchase, as well as enabling them to target content and offers to specific visitors.
Elsewhere, Mobicart, which helps companies to improve their mobile storefront, has just raised £300,000 from Northstar Ventures and an angel network. Datasift, which sources data from social networks and aggregates it into actionable insights, has raised $13m (£8m) since last summer. We have seen social commerce businesses such as Reevoo and Yotpo, which improve conversion through trust features such as independent user reviews, continue to grow and raise money.
It’s clear to us that this trend is here to stay. Today, only a small proportion of businesses are truly data-driven in how they take decisions about their digital presence; as consumers continue to expect the web to do more with less hassle, there will be an increasing need for digital services businesses to help CEOs and marketing directors to keep ahead.