Did you know there are a lot more options for monetizing data than selling a database? Through our work helping companies explore and monetize their data, we’ve identified three common strategies that any organization can easily use to build new revenue from data.
Companies have been buying and selling data for as long as there has been data. Most people are familiar with two common types of data you can buy: sales lead lists and customer contact databases. What has changed in the last few years is the extent of data, and a broad range of new technologies that make it easier to package and demonstrate value to prospective customers.
When we work with clients who are interested in monetizing their data, the first thing we do is walk through these three strategies to sell data to customers:
Data as a product: An example is a sales lead database. Customers buy the data ‘product’ once, and continue to use it as is. This works well for data that doesn’t change very often, and so you want to maximize revenue from each customer.
Data as a service: An example is a stock ticker. You buy access to the data, rather than the data itself. This is ideal for data that changes frequently, and where customers will want access to the most up to date data possible.
Data as an app: An example is a property website like Zillow. The key thing here is that customers don’t get access to the raw data, instead they have to use the app to interact with the information. This is great for data where you have privacy or ownership considerations and would not be allowed to share it.
When thinking through which monetization approach is right for you, there are some things to consider:
First off, how often does your data change? Is it frequent, or infrequent? Will customers be interested in having a snapshot, or the most up to date information possible?
Second, how much are you willing to invest, and what is the desired return on that investment? The price for data can sometimes be hard to determine, so its important to understand how much you are looking to earn as a result of selling it.
Third, what kind of revenue per person (RPP) are you looking to earn from your data? Do you want a lot of customers paying a little, or a few customers who pay large fees?
Unfortunately, there is no ‘magic bullet’ for selling your data. Depending on your organization, market, and potential customers, any one of the three approaches outlined above could be successful. The important thing is to know your options so you can find the approach that will maximize return on your investment.
Interested in building revenue from your data? We help companies leverage these strategies to successfully sell their data.
Contact us to set up a consultation.