Using Big Data to Support Small Businesses

Through big data analytics, the Seoul Metropolitan Government is able to provide invaluable market insights for small business owners and support local economic growth. Photo credit: Seoul Urban Solutions Agency

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The Seoul Metropolitan Government provides market analysis, such as consumption patterns and purchasing power, to help small entrepreneurs succeed.


The Republic of Korea’s capital Seoul has seen a boom of small businesses opening across the city. The number of new cafes opening in Seoul shot up to 3,053 in 2014 from 1,921 in 2010, while the number of new pubs also doubled over the same period.

However, the Seoul Metropolitan Government found out that over a third of the businesses close down within the first 3 years of operation. For example, 38% of the chicken-and-beer restaurants that opened in 2012 were deregistered by 2015.

Such business failures come costly to families who often invest their life savings into the enterprise so the city government decided to look for ways to help these small entrepreneurs.

This article is adapted from Big Data Governance: Supporting Business with Big Data, which is part of a series of briefs on big data published by the Seoul Urban Solutions Agency. The publication discusses how Seoul—the capital and largest city of the Republic of Korea—used its huge pool of data resources to launch its Big Data Business Environment Analysis Service in 2016 to provide small businesses with an accessible and easy-to-understand source of business and market environment analysis.

What can big data do for small entrepreneurs?

Prospective entrepreneurs can benefit from a thorough analysis of market conditions before rushing to open a new store while existing business owners can use it to review their strategy.

Seoul’s Big Data Business Environment Analysis Service makes use of big data collected by various departments and agencies of the metropolitan government and other public agencies as well as the private sector, such as telecommunications providers and credit card companies. Data gathered include rent prices, credit card transactions, traffic data, prepaid transportation card (T-money) usage, business statistics, population, income, building information, bus stops, and subway stations.

In total, 210 billion data points were used to establish the analysis system, with 10 billion data points being added every month to update market insight into local business environments.

What does Seoul’s analysis service provide?

Market Analysis Service

The Big Data Business Environment Analysis Service covers 1,008 small-alley areas across Seoul and provides market analysis for 43 types of business that are particularly popular for small-scale entrepreneurs, such as convenience stores, Chinese restaurants, cafes, and pubs.

Big data can provide consumption patterns, floating population, social media trend, traffic data, purchasing power, and commercial establishments, which are useful information for any business.

The service proved to be popular, attracting over 12,000 visitors and getting one million page views in the first 2 months of its trial operation. The service provides a range of information for small entrepreneurs—tailored to the needs of either prospective or existing businesses.

The service maps a range of market index figures, which are processed from small business statistics. It covers the following type of indices and search assistance:

  • Business Risk Index draws on business environment data to indicate the risk of opening a particular type of business in a chosen area. Color codes are used to visualize pockets of risk: blue (caution); yellow (doubtful); amber (risky); and red (highly risky).
  • Business Activity Index combines the size of floating population and the number of commercial transactions to analyze business vitality of a chosen industry.
  • Growth Potential Index forecasts the growth potential of a chosen commercial district by drawing on monthly variation on the volume of trade.
  • Business Stability Index indicates business survivability by combining business closure rates (business deregistration/business registration) and the duration of business operation.
  • Comparative Search helps the user to compare multiple areas for their chosen business interests. For example, you can see how a bakery faces different competition and business potential in different parts of Seoul.
  • One-Click Search provides business district analysis down to the level of individual alleyways in order to support detailed analysis and field survey.

This analytic insight service offers curated information for those looking for specific market conditions for their new business. For instance, searching for “university area in District A” will return street-level recommendations like “Street B” and “Street C,” which attract a high student population. It also provides area recommendations for the latest trending business interests.

Designed for those already running a business, this service provides a tailored report on the surrounding business environment. Consumer type and consumption behavior pattern analyses help business owners re-calibrate their target customer goals and review business strategy accordingly.

An easy-to-use search service allows prospective entrepreneurs to browse through a wide range of commercial environment data tailored to their business plans. Information such as the number of businesses in the same industry, average revenue per business, daily traffic, overcrowding index, and demographic data is provided for a radius of 100 meters to 1,000 meters.

How can small businesses make sense of all the data?

Getting all the insight from big data analysis service is one thing, but putting those valuables lessons into action can still be a challenge for many. The Seoul Metropolitan Government offers a support network by providing business consulting service from expert groups as well as a number of incubating initiatives and business support packages to help small business owners make the most out of what they learned from the business analysis service.


Seoul Urban Solutions Agency. Big Data Governance: Supporting Business with Big Data. Seoul.

Seoul Urban Solutions Agency

The Seoul Urban Solutions Agency (SUSA) was established by the Seoul Metropolitan Government to share its urban development experiences with other cities seeking to become sustainable and smart urban domains. Through a wide network of partnerships with the public and private sectors within and outside the Republic of Korea, SUSA works to connect and leverage its wide range of knowledge and resources to assist in solving the development challenges of its partner cities. 

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