This coming year will be the one that marketing a company’s data as a viable revenue-generating “product” will gain traction across a myriad of vertical industries. Businesses are looking for ways to expand their revenue lines, and data’s unique attributes make it attractive to sell, from a pure P&L perspective. It’s a product that you can sell and sell more than once. We can expect that, in 2022, not only will we make the formal leap in which vertical industry companies will aim to sell data — this data will expand beyond customers and customer insights.
Companies Are Getting Ready
Data that comes from vertical industries is a sleeping giant getting ready to roar. Large and mid-sized companies across industries are collecting data every day, and while not all of it can be sold, much of this data can be packaged and marketed to get started generating revenue streams.
A recent study by MIT’s Center for Information Systems Research outlines the five capabilities that businesses trying to grow their financial returns from their data must develop. These include:
- Data asset capability that generates data people can find, use, and trust
- Data platform capability that serves up data reliably and quickly inside and outside of the company
- Data science capability that uses mathematical and statistical talent and tools to detect what humans can’t
- Customer understanding capability that identifies important core and latent needs
- Acceptable data use capability that governs data with regard to regulation, law, and ethics
Once companies match up to their data compatibilities, the report’s authors maintain that in order to convert data into money they need to be able to sell data sets, insights, and advice. This requires organizations to have the capability to sell information solutions.
Vertical Data – Opportunity Abounds
Examples of data that vertical industry companies have already begun selling include, for instance, human capital management firm ADP’s compensation benchmarking data. Among the specific offerings available are datasets around employee compensation benchmarks, employee job titles, and employee locations. ADP notes the datasets could be used to analyze and benchmark certain compensation criteria including base salary, bonus payments, total compensation, and possible overtime within industries.
Travel company Trivago sells data about its aggregated hotel prices, sharing data it has collected from over two million hotels around the world. This is data you might want if you’re interested in travel patterns, hotel stays, and tourism travel.
One other example of how companies are already marketing their data in different vertical industries includes the Associated Press, which has datasets available on US election data, COVID-19’s impact on businesses, and detailed data on the conditions of our nation’s water dams.
Agriculture and Farming Data Sharing
Another vertical that is ripe for selling proprietary data useful to many additional companies in 2022 is the agriculture and farming industry. We can expect to see farmers organize collective data pools with other geographically situated farmers. Once this kind of data is collected, aggregated, and positioned, it can be sold to large corporations to the likes of John Deere, Heartland, Scotts, and others. Selling this data means farmers will be able to realize a real revenue stream for the collective.
Ocean and Deep-Sea Insights
Ex Scientia is a business that develops ocean-based vehicles to transform the way ocean data are collected and distributed worldwide. They are a prime example of vertical industry data that is bringing access to previously unobtainable data and insights for scientists, engineers, and governments for a variety of ocean-related projects and business issues.
Energy — Oil & Gas / Electricity Data Sharing
Companies in oil & gas, energy, and hydropower (like hydroelectric dams, oil refineries, and other power-generating facilities) are increasingly faced with external challenges like growing global demand for energy, security challenges to pipeline operations, and the push for decarbonization.
While the issues of data sharing of sensitive energy information are tied to security and privacy concerns, we can expect to see advancement in 2022 in tackling these issues. Several states are already working on creating best practices to overcome the barriers of data sharing as a result of the recognition of the value in shared energy data.
Who will Succeed in Data Marketing?
There will be challenges to face in 2022 as more and more verticals explore data revenue streams. Best practice data usage methods are likely to be shaken up with increasing regulation around the practices of consumer and even business data. So it will be important to stay on top of this evolving landscape.
However, it’s fair to say that no successful business has ever been built without marketing. Data businesses are no different. Having the ability to transparently market data – and market it like a product – becomes obvious and paramount in this coming year.
It will be incumbent upon vertical industries to effectively market and promote their data to enjoy the competitive and monetary benefits that stem from access to and sale of data. Done right, the opportunities for realizing new revenue streams in 2022 look promising.
About the Author
Steven Schwartz is the Chief Operating Officer (COO) of Narrative, the Data Commerce Platform company. As COO, Schwartz oversees Narrative’s business operations, including the execution of partner strategy, finance, sales, and day-to-day operations, and works directly with senior management to help drive a repeatable, predictable high-growth business. In addition, Schwartz is focused on driving visibility and momentum for Narrative as it continues to shape and define the Data Streaming category.
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