Data monetisation, or the process of using data to obtain a quantifiable economic benefit, has become big business. In fact, the global data monetisation market is valued at $2.9 billion and forecast to more than double to $7.3 billion in the next five years. This is hardly surprising given that data creation is expected to reach 180 zettabytes worldwide by 2025 and storage is becoming increasing affordable. Companies, both locally and abroad, have the opportunity to ride this wave and unlock new business and revenue growth opportunities.

“Data and analytics have become critical success factors in the push towards data monetisation. Technological enablers like the Internet of Things (IoT), 5G, edge computing, cloud platforms and services, and the ongoing evolution of artificial intelligence (AI), have significantly contributed to the generation of more data,” says Andreas Bartsch, Head of Innovation and Services at PBT Group.

There are different methods of realising data monetisation. Direct monetisation typically relates to actual data being sold while indirect monetisation can refer to potential operational efficiencies or process improvements that are quantifiable. To embark on a data monetisation initiative requires decision-makers to consider the potential demand for the data, identify the business use case, and then quantify the value.

Of course, the organisation must ensure that it uses a reliable process to obtain, quality assure, govern, and maintain the data.

“The adage ‘garbage in, garbage out’ certainly holds relevance for data monetisation as well. If the data is not of high quality and is relevant, then there is no value, financial or otherwise, to be gained from it,” says Bartsch.

Linking with analytics

As far back as 2017, the opportunities that could arise by using data and analytics to change the ways in which business is done were only embraced by a few businesses. Today, data and analytics have become the key differentiator as organisations use it to generate growth.

“High performing organisations across industry sectors are using data and analytics to improve internal efficiencies, develop new products, and to innovate by creating new value add services to their clients or business partners. It is also in these organisations where data monetisation is starting to feature as a line item in their financial reporting as they are building the capability to sell data related products or embedded analytics utilities,” he says.

Of course, there are various ways to monetise data inside a business. For instance, the collection, cleansing, preparation, and packaging of data for direct data monetisation purposes can entail the direct sale of data for re-use. Data monetisation can also encompass the provisioning of insights as part of a solution or service within an application. An example here could be a claims administration application that provides built-in analytics and insights related to the clients’ claims profile.

Starting the monetisation journey

Once the fundamentals of having clean and quality data are in place, monetisation can become a revenue stream. However, a different go-to-market approach must be determined. As always, the process starts by determining the business case to assess the feasibility of the initiative. It also provides key return on investment figures to highlight the demonstratable returns of embarking on the process.

Additionally, companies need to define their data monetisation strategy. The organisation must identify the most relevant uses of the data product or service in collaboration with the key stakeholders and partners. The data monetisation strategy will provide direction as the journey progresses and can be amended in alignment with the learnings along the path.

“Critical is the need to ensure regulatory compliance. Access, security, and regulatory compliance aspects are non-negotiable when determining the practical implications of a data monetisation project and minimising any risk to the organisation. Regardless of how the company approaches this journey, it should consider starting small to provide the agility needed to efficiently embark on the project. In taking such small steps, it provides the business time to tweak and refine the supporting processes whilst collaborating with stakeholders to improve the value proposition,” concludes Bartsch.