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Six steps to starting a corporate information business

Many companies are turning their valuable data into services. But there are tough challenges to overcome along the way.

Overview

Companies can do a lot with the data they collect. They can use it to make better decisions, target customers with precision, become more efficient. But can they make money by selling it to other companies?

Getting started with “data monetization” presents tough challenges for executives. They have many questions. Most see the potential of an information and insights business, but few know how to assess how great it is.

 

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Key Insights

In this environment of early promise and ongoing confusion, how should a company’s “information entrepreneur” move forward? Here are 6 steps to take.

  1. Treat the information business as a digital start-up: Information entrepreneurs have to understand that selling data can’t just be a sideline, or casually undertaken. Executives have to identify unmet needs and potential customers, calculate whether the opportunity justifies the effort, choose how to price and charge for the product, and decide how to operate and grow the business.

  2. Don’t think of selling data as an all-or-nothing proposition: A company may decide to keep some information close to the vest, share other insights freely with partners, and sell another slice to willing buyers.

  3. Find a big-enough sweet spot: Where to look for ideas? Find chronic industry problems that can be solved by bringing new data sets, then ask how much solving the problem is worth. Identify market segments where there is already significant spending on analytics, or where clients can greatly reduce costs.

  4. Scout the road to long-term growth: Starting with a relatively small niche business provides information business leaders with the opportunity to prove concepts, build internal credibility, and make mistakes at a relatively low cost but companies should also look for opportunities to provide new services that offer greater value to customers than your initial wave of services.

  5. Manage the information business as a value chain: As more people or businesses provide data, the richer the data set becomes. The richer the data set, the more valuable it becomes. But when getting started, it’s also useful to think of an information business as a value chain.

  6. Keep trust with those whose data is used in the product: No business can be sustained if it fails to earn the trust of its customers. But information businesses are especially dependent on maintaining a reputation as a trustworthy, non-invasive and useful steward of information.

Recommendations

A new information business can be a tough sell to other executives. It can look like a side business—not worthy of any attention. Data may be less valuable than initially thought. And information entrepreneurs and their bosses always worry about protecting the data they sell and whether it could be used against them by a competitor. But with these six steps in mind, information businesses can become meaningful, manageable business opportunities. And given the hunger for information and information services in the era of analytics and big data, information businesses deserves a place in a company’s new business development portfolio.

Read Starting a Corporate Information Business? Consider These Six Tips in The Wall Street Journal

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ABOUT THE RESEARCH

We interviewed 25 senior executives who make decisions about where, when and how to sell company data. We also spoke with Accenture experts and conducted extensive secondary research.

ABOUT THE INSTITUTE FOR HIGH PERFORMANCE

The Accenture Institute for High Performance develops and publishes practical insights into critical management issues and global economic trends. Its worldwide team of researchers connects with Accenture’s business leaders to demonstrate how organizations become and remain high performers through original, rigorous research and analysis.

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The Research Team