From Liability to Asset: How Businesses Can Monetise Their Data and Drive Business Growth
In today’s data-driven world, data has become a valuable asset for businesses. Data collection not only provides businesses with valuable insights but also opens up possibilities for generating revenue by selling the collected data to other organisations. However, there are many challenges to doing this. From privacy concerns to data quality issues, we will examine the obstacles that businesses need to overcome to effectively monetise their data.
What Are the Challenges of Monetising Data?
Every organisation, big or small, produces data that is beneficial to the larger big data landscape. For instance, your local independent store likely has a better understanding of the buying habits of its regular customers than a large chain supermarket. However, do they monetise and sell this data? In the last decade, there have been significant improvements in monetisation opportunities. Nevertheless, there are still challenges when it comes to generating big data analytics that can be used for machine learning models.
Lacking Knowledge and Information
Times have changed; you no longer need a full team of data scientists to monetise your data. Instead, you can use Tableau to help structure it. Businesses must be mindful of regional laws surrounding data protection and personal data:
Businesses often view this as a costly and labor-intensive process. However, the revenue benefits of selling data far outweigh the costs associated with it. When you're ready to sell data, there are many data brokers who can help. Examples of data you can sell as an SME include:
- Email marketing data
- Phone number data
- Location data
- Mailing lists
Ensuring Quality of Data
One of the main challenges businesses face when selling data is lack of commitment. Becoming a data vendor and selling your data is another revenue stream and with that comes responsibility. What some businesses fail to understand is that you have to update these data sources on a regular basis, when another organisation buys data they expect to gain a unique insight and this is rarely the case with bulk data transactions. Bulk data transactions are most useful for identifying basic trends and training past machine learning models.
Creating a Sustainable Monetisation Strategy
Data in established corporations is often siloed and locked away, which can make it difficult and costly to access. To avoid this, it is important to implement ways of practicing data monetisation from the beginning.
In today’s ecosystem, data is the key to decision making for all businesses. Data driven decisions create competitive advantages which can lead to longer term success and additional revenue streams. If you wish to monetise data, your business needs to conduct research to understand the true market value of all the information you generate.
Unclear Payment Models
Another challenge in monetising data is the lack of clarity in payment models. Many organisations are not sure about how to set up a payment model that works for both the buyer and the seller. Additionally, organisations may not be sure about the cost of data and how much the buyer should pay for it. To ensure that the payment model is fair and transparent, it is important to research the data market and understand the value of the data before setting a price. This can help organisations to ensure they are being paid what the data is worth and that buyers are not being overcharged. Additionally, organisations should be clear about the terms of the sale and the rights of the buyer. This can help to create trust between organisations and buyers, which can help to increase sales.
Over the last few years we’ve seen the rise of a number of marketplaces try and solve this problem with a number succeeding in automating the legal aspects including:
- www.trovalo.io - a data marketplace with a transparent pricing model which is creating data monetisation tools
- www.dawex.com - a data exchange platform focussed on the secure exchange of datasets
Privacy concerns: The Biggest Challenge in Monetising Data
The final challenge to monetising data is that of trust. Many organisations don't trust the security of their data when it's sold to third parties, and this can make it difficult to get customers to buy data from them. To build trust, it's important for organisations to ensure that their data is secure and that they have the necessary processes in place to protect it. This could include measures such as encryption and authentication, as well as regular security audits. Additionally, organisations should ensure that the data they sell is accurate and up to date, as customers will not be willing to buy data that is not reliable.
How to Successfully Monetise Your Data
Monetising data can be a lucrative business, but there are several key challenges that must be addressed in order to ensure success in this endeavour.
- It’s essential to have an in-depth understanding of the relevant data protection laws, both locally and globally. This is particularly important for businesses that operate across different regions and jurisdictions, as different regulations may apply.
- Businesses must ensure that their data is kept up to date, in order to provide customers with accurate and reliable results.
- Data silos must be avoided, as these could severely limit the ability to monetise the data.
- It’s important to establish a payment model that works for both parties, in order to ensure that all parties are happy with the outcome.
- Building trust with customers is key, as they must be confident that their data is secure and that their privacy is respected. By addressing these challenges, businesses can unlock the potential of monetising data.
If you feel unsure of steps in that process working with data marketplaces like ours can be an option to overcome these challenges and faciliate your journey on generating revenue from your data. Curious about our process for data vendors? Check it out here.