Irish Companies Risk Irrelevance as Digital Economy Surges

According to a new report released by BearingPoint, Irish businesses must take greater advantage of new digital technologies to grow their operations.

BearingPoint made the comments today as it announced that it has teamed-up with IT think-tank, the Innovation Value Institute (IVI), to help Irish businesses develop long-term digital strategies.

The development comes following a number of recent studies which show that while Irish consumers are spending heavily online, most are buying from international, rather than Irish, retailers.

Irish people are estimated to have spent €6 billion online in 2014, according to a recent study. In 2013, the Government estimated that Irish online shoppers spent only €1.1 billion on Irish goods and services.

Publishing its digital strategy report, “Leap into the connected digital economy”, BearingPoint said Irish businesses need to integrate digital thinking into their business model if they are to retain and grow their markets.

BearingPoint Institute figures suggest that the online market will constitute 20% of the entire world market by 2030. Currently, Ireland’s internet economy is worth 5% of GDP, and is estimated to grow to 10%, or €21.1 billion, by 2020.

The report claims that the convergence and mass adoption of new technologies is creating a new digital environment, where businesses are investing in new skills and looking to their digital-focused partners to provide technological insight and value to their operations.

While the report outlines the consistently strong value of physical stores (consumers can see, touch and test products), through innovative use of emerging digital technologies, businesses can offer bespoke, personalised services, resulting in new customer experiences.

The BearingPoint Institute report highlighted how car manufacturers – through the use of integrated digital services like music streaming, automatic traffic updates and anti-theft tracking – are embracing a combination of new technologies to enhance customer experience.

However, there is concern that an unwillingness to adapt to new technologies, or a general ignorance of them, may be holding back Irish businesses.

The report cited Blockbuster, Kodak and EMI as businesses that had failed to adopt a meaningful digital strategy in the face of internet-born competitors, suffering considerably as a result.

More information on the report and further reading can be found on the BearingPoint and IVI websites.