Embedded analytics, data products, data monetization, big data….there are plenty of buzz words we can use to “categorize” the idea.
IDC reports that the big data and business analytics market growing at a rate of over 11% in 2016 and at a compound annual growth rate of 11.7% through to 2020. This rapidly growing area of investment can’t be for naught….can it?
Let’s look beyond the hype at some specific approaches for extracting additional value (and ultimately dollars) from your data.
According to Gartner, Data Monetization refers to using data for quantifiable economic benefit.
The first thing that may come to mind is outright selling of data (via a data broker or independently.) Although a potentially viable option, with increased data privacy policies and the sheer amount of data needed to be successful with this approach, it can be quite limiting.
There are many other approaches to monetizing your data, such as:
Improving sales & marketing effectiveness: The better you know your ideal customer, the better you can target and engage them. This could mean improving marketing spend, speeding up sales cycles or having more engaged buyers.
Reducing operational expenses: Although perhaps not as sexy as increasing net-new revenue, by identifying areas of opportunity to reduce waste or streamline operations, using data effectively can save you a lot of money.
Creating data products: You can leverage data you already have to allow your customers to improve their decision-making and receive additional value from your “core” product. The popular support management platform Zendesk used their Insights product to incentivize customers to upgrade to higher tiers. The firms Coupa and Vancouver-based PayByPhone sell analytics as a separate line item.
Basket analysis: One of the most popular algorithms is market basket analysis. It provides the power behind things like Amazon’s product recommendation engine and identifies that if someone buys product A, they are likely to buy product B. More specifically, it’s not identifying products placed next to each other on the site that get bought together, rather products that aren’t placed next to each. This can be useful in improving in-store and on site customer experience, target marketing and even the placement of content items on media sites.
The best starting point for turning your data into dollars is to understand your target audience and the pain they are experiencing. What are they unable to do because they lack the data you can provide?
These are just a few of the approaches to creating more value for your customers (and ultimately generating revenue) with data. Want to learn more? Check out our recorded webinar where we'll cover:
What IS data monetization anyway?!?
How to turn your data into dollars, now.
Simple steps you can take to get started, today.