Over the last 10 years, I’ve helped countless companies big and small extract value from their data. With pundits everywhere declaring that “data is the new oil,” they’re desperate not to miss out on the boom. But where do they start?
A typical conversation involves an executive declaring that their data is going to be a fantastic new revenue stream for their company. They just need help to figure out exactly how to monetize it. It’s at this point that I tend to be blunt:
Your Data, Much Like Your Baby, Is Ugly
Before you jump to the conclusion that I hate babies (I don’t!), my point is that the biased way that companies view their data often has more than a passing resemblance to how parents view their children: cute, adorable, and ready to be splattered all over Facebook for the benefit of the world. Who couldn’t see the perfection in their one-of-a-kind bundle of joy?
See where I’m going with this one?
The reality, of course, is that while your child is very cute and will undoubtedly grow up to be a wonderful member of society, right now she’s probably only perfect to you.
Your company’s data is the same.
A company’s data can be incredibly valuable, but it’s usually not as a direct revenue source. In fact, only a handful of companies generate direct revenue from their internal data, and in most cases it's not until many years into the company’s lifespan.
Where's The Value?
So what about everyone else? For 99% of companies, the value isn’t in selling the data, it’s in using it to improve their product, service or company. This includes everything from reducing costs to identifying opportunities for cross-selling and upselling, to creating more effective marketing campaigns. There’s an incredible amount of value in that data, but you’re (probably) not going to “strike it rich” with the easy win of a revenue stream.
So roll up your sleeves and get to work.
To help you get started, here are 5 Ways Startups Can Leverage Big Data.