Data monetization via external apps

Many vendors talk about the importance of extracting value from information, but Information Builders (IB) is able to show how analytics have struck the mother lode in tech deployment – new revenue streams. The primary vehicle for this is the customer case study, which serves as a showcase for new technology, but also to demonstrate the art of the possible, and in so doing help businesses vision how IT solutions might be applied in their own contexts, and to what end. By comparing and contrasting their own organizational requirements and resources with the subject study, the consumer of case studies can access the ‘how to’ as well as the metrics needed to push through inertia to building their own business case for implementation. At a recent breakfast seminar, Monetizing Big Data – New Ways to Profit from Data and Analytics hosted by IB Canada, the case study was front and centre, telling the real life stories that resonate with technology users due to their authenticity, and with the 60-odd invitees from across the financial, healthcare, energy and other industries who attended the event.

Scott Hassell, director of market intelligence, Information Builders, kicked off the breakfast session with the observation that up to now, data has been used to track internal operations, but that a trend is building towards the use of data to uncover new sources of revenue. According to Hassell, ‘data monetization’ is not just a huge topic in media right now, but the basis of businesses that are eclipsing traditional enterprises: Facebook, for example, has a market cap of about US$231 billion, while United Airlines, an older organization with extensive physical assets, has a market cap of approximately US$34 billion.

But analytics are not only for the Internet giants. The growing prevalence of data-based business models, for example, has led Gartner to consider the topic of data monetization, and to conclude that there are essentially two types of providers: organizations that sell data (relatively few); and organizations that use internal data to improve customer relationships (relatively more). The trick then, lies in monetizing this improvement of customer relations, a trick that is enabled through development of external or customer facing applications that rely on business intelligence to deliver value to clients.

According to Hassell, Information Builders is uniquely qualified to help in these initiatives since it provides the range of data integrity (quality), integration (with multiple internal and external, third-party data sources) and intelligence solutions, including custom app development capabilities and advanced data visualization, delivered on a common platform to ease management and deployment. IB is certainly not alone in the analytics marketplace, in fact, heightened opportunity in the Big Data space has seen the entry of a number of new niche players to challenge the roster of large, traditional vendors that offer analytics capabilities; however, IB sees its ability to address the needs of a wide range of users as a key differentiator. As Hassell explained, traditional business intelligence tools cater to the requirements of the power users (technically savvy data scientists) and the analyst community. But today, business users are looking for quick access to information, and it is supporting this underserved constituency that is an Information Builder specialty – and the source of new revenue.

So what is the mechanism for servicing Hassell’s “users in the grey box”? In a word, it is InfoApps that are easy to use, intuitive, don’t require a manual for use and contain lots of information in order to offer new levels of convenience and flexibility to both the originating organization and its customers. As Hassell described them, InfoApps feature high levels of self-service (which means that it’s not necessary to make a large investment in training) and are highly consumable, and hence attract customers who will want to continue to do business with the organization.

To demonstrate, Hassell described a variety of deployments that generated benefits based on improved customer satisfaction, cost reduction through operationalization of better processes and insights, and increased market share through organizational differentiation. In his view, deriving tangible ROI from traditional BI is often challenging – hard numbers are elusive, and “soft benefits” are a more likely outcome. But in external facing BI applications, ROI is easier to measure.

In the case of Ford Motors, for example, the company noticed wild variation in dealer charges for warranty work, and that warranty costs were spiraling out of control. To introduce greater transparency into this process, Ford used IB’s WebFOCUS technology to develop the GWMS EZ warranty app and report that would track performance metrics for repairs, making different costs visible via data visualization to warranty administrators, dealer principals and GMs across the dealer network. The ability to benchmark a location’s performance against that of the network produced improved behaviour from the service mechanics specialists, and $40-60 million in savings on dealer charges for Ford. Similarly, the Charlotte Mecklenburg Police Department deployed WebFOCUS dashboards and predictive analytics, combining crime data with data on the weather, time of day and large events to try and uncover patterns in crime data. When these variables are plugged into the predictive model, a heat map showing where crimes are likely to occur is produced that allows CMPD chief of police Rodney Monroe to deploy resources proactively. While Chief Monroe did not receive funding for more police officers, he was able to save $7 million over three years through more judicious resource allocation to generate an ROI of over 500 percent on the technology deployment.

Hassell also described cases where data was used to improve customer relationships: Moneris, which used WebFOCUS to deploy Merchant Direct, a highly scalable application that allows merchants to quickly view their Interac, Visa, and MasterCard transaction data online 24/7, automatically consolidate card transactions across multiple locations, engage in trend and forecast analysis, produce daily reports and migrate data to accounting programs for planning and reconciliation. Time savings and increased productivity for merchants delivered through the app translated into increased loyalty for Moneris, in an industry characterized by high churn rates.

Other examples of external BI discussed at the event (and described in greater detail on the IB website) include the City of Irving, Texas which uses Information Builders’ BI to track performance of different departments and city agencies, Yellow Pages, which developed a free digital analytics solution with revenue calculator that allows its advertisers to understand the financial impact of its ad spending, Insperity, a provider of HR business solutions that differentiated in its own market by offering self-service analytics which allow customers to create solutions on their own, the Principal Financial Group, which developed Interactive eStatements that allow customers to change visualizations and add calculations without a network connection and email reports, Securities America, which provided Dashboard 2.0, a mobile capable customized dashboard that internal financial advisors use to collect information from a variety of sources and develop a consolidated view to better answer client questions, and the US Bank, which created the Scoreboard app that SMB customers can use to analyze spending on credit cards distributed to their employees – the list goes on here.

To conclude, Hassell offered advice to organizations that want to get started. Step one involves defining which information can provide the most value; a next step involves locating where this data would come from; step three is understanding whether or not the data is ready to be monetized; and a final step involves framing the project so that all stakeholders can participate. And for those ready to take a final – or first, depending on the perspective – step towards developing an external facing BI app prototype, he advised taking the IB Data Quality Challenge, the Mobile BI Challenge and the Social Media Analytics Challenge, Information Builders services aimed at helping organizations understand the limits and opportunities in their data.