In the digital economy, data is the new currency. Just about every company that has undergone digital transformation naturally collects massive amounts of data that can be spun into valuable insights. It’s a virtual treasure chest just waiting to be opened – and channel partners can help CIOs pick the lock.
“One-third of companies are commercializing or sharing their data for revenue,” says Forrester analyst Jennifer Belissent, in a research note. “The trend cuts across industry, company size and market segment.”
Here are just a few examples of monetized data products and data-driven insight services:
- Enigma mines public data for insights, such as publicly available liquor licenses to identify restaurant openings so that hospitality services can target them.
- John Deere aggregates data from its Internet of Things-enabled tractors to help farmers make better operational decisions.
- Monsanto and Dupont offer data-driven services that advise farmers when they should plant, water, apply pesticides, harvest, etc.
- LexisNexis collects and analyzes data to come up with benchmarks for, say, worker compensation claims so that companies can compare how they’re doing with their peers.
Smaller companies, too, can play in the data game by adding their data sets to a network. Generally speaking, the wider the net of data sources, from internal transactional records to external profile information, the greater the insights about the customer. And the more a company knows about customer intentions, the better it can serve them.
“A sportswear company might know that a customer purchased running clothes, but knowledge of a marathon registration would suggest more than an aspirational preference for working out,” Belissent says.
So where does the channel fit in?
Channel partners unleash data products and data-driven insights services a number of ways. They can help CIOs find data opportunities and execute on them. They can facilitate data sharing across a network, in order to uncover more powerful insights. They can improve data quality and make data-driven insights more consumable, more actionable. They can even be distributors of data services.
“Commercializing data and sharing it with business partners such as suppliers, resellers or channel partners – facilitated by the prevalence of SaaS – is often a logical first step,” Belissent says.
There’s no question companies need help from channel partners to transform data into business outcomes, such as operational insights and new revenue streams. Forrester says 71 percent of data and analytics decision makers are engaging external service providers or strategic business consultants.
“The National Basketball Association turned to KPMG for insights into how to optimize its grueling game schedule in light of TV and travel constraints and concerns about player health,” Belissent says. “The growing insights imperative and the rise of insights services further accelerate the demand for new data.”
Of course, not all companies are monetizing data – only around one-third, according to Forrester. Channel partners should target companies with chief data officers, or CDOs. These companies have the best odds of seeing data’s potential. According to Forrester, 48 percent of data and analytics decision makers who report that their companies have a CDO say they’re commercializing data, compared to 24 percent of those without a CDO.
Also, companies struggling to grow revenue often have tunnel vision – that is, they’re focused on their core business. This limits their ability to envision and create a data product or data-driven insights service. Conversely, high revenue growth companies are almost three times as likely to share or sell their data, Forrester says.
Based in Silicon Valley, Tom Kaneshige writes the Zero One blog covering digital transformation, AI, marketing tech and the Internet of Things for line-of-business executives. He is eager to hear how the data economy is impacting your business. You can reach him at [email protected]