Last year I was contacted by Online Kostumer, a webshop selling costumes (or Kostumer as they call them). Even though people are buying costumes like never before and it’s a market on the raise, they were slowly loosing more and more sales due to various factors. They have tried a lot of various random things turn their finaces around and start to make some decent profit again. One of the things they did was close their 2 local stores and focus only on their website onlinekostumer.dk selling their main produkt Tyroler Kostumer online only. But even such an aggresive move, wasn’t enough to turn the business around, so they contacted me to help them out with a business intelligence system, to help them figure out exactly what they were doing wrong.
Identifying the problem with Online Kostumer
The first thing we did, was to install the Targit Business Intelligence suite and started to collect as much data as possible. Nothing was changed over the next few months, and we did was to observe and record data. Three months later, we went over the various data that was collect, both within the last 3 months, but also more historical data for Online Kostumer. We compared these data to what information we could find about their competitors like Tema shop, Gag and Karnevalsshoppen and found that the main problem was the competition, that they had simply been more agreesive than predicted, and that they had been spending way to many resources on the two local stores, compared to the online one. So selling off the local stores and putting the focus on the online site, was indeed a good move, it just came way to late to have the impact they wanted. In addition to the competition, we could also see that the logistic part wasn’t running optimal, and they could reduce the costs quite a bit, if they did some optimizations here. It also turned out that their product fastelavnskostumer was costing them more money than they earned. So they decided to get rid of the product fastelavns kostumer completely.
Solving the problems
Finding the problems with onlinekostumer.dk wasn’t enough, most of the things wasn’t something that could be easily fixed. But now having an idea about what the main issue was, it was suddenly a lot easier to create a strategy that would help turn all of this around. To deal with the main problem, the online competition, they hired a local marketing firm, to help create a strategy that should bring more of the online visitors to their site. Fixing the logistic problems was a lot easier, it was mainly all about switching to another external warehouse and sending the packages with another shipping company. We also found that the sales team was a little understaffed, so we hired a new full time sales person, en 2 part time students.
It’s still a little to soon to say if Online Kostumer has been saved, but things seems to be going better, and now they have at least identified their problems, by using business intelligence and hopefully we will see a change for better in a few months. It was indeed a very interesting case, and another example of how you can use BI to improve a whole business.
interested in getting started on BI yourself? Here’s a video that explains a bit more about advanced analysis and business intelligence.