How data can save organizations and drive innovation 

Following the mass closure of stores across the US earlier this year, reports indicate that retail pharmacy Rite Aid recently filed for bankruptcy. For Rite Aid in particular, its heavy financial losses stem from multiple lawsuits coupled with extremely tough economic conditions.

Unfortunately, it’s not just retail chains that are struggling to fight off bankruptcy. With the cost of living soaring globally, we’re seeing more examples of public government offices and non-profits going bankrupt. For example, in the United Kingdom the city council of Birmingham declared itself bankrupt putting a stop on all public spending. Yet subsequent reports note that 100 other local authorities in the country have a similar debt burden.

Charities worldwide are also facing a perfect storm of inflated prices, increased demand for services from struggling members of the public and dwindling resources. This can be seen playing out in real-time everywhere from Australia and Pakistan to France and the US.

This is a concerning trend. With more people needing to rely on public services and non-profit organizations, demand is skyrocketing yet these organizations have less resources and can’t support all those needing aid.

If these organizations go bankrupt, disruption across societies will deepen further. But companies like Rite Aid and public services alike have an underutilized resource that can be leveraged to tackle insolvency during these troubled times.

Data monetization markets are set to reach $15.5 billion by the end of this decade. Brands like Rite Aid and public organizations are likely to have access to huge data pools that can be used strategically to create new revenue streams that will serve as a lifeline during these tough times.

An untapped data goldmine

Describing data as “the new oil” undersells its potential – data has greater value. Based on Rite Aid’s transaction and product volumes, footprint across thousands of stores and pharmacies, and millions of customers, the company possesses a wealth of datasets that represent near-term realizable economic value for the company.

This data is typically collected as standard by brands and retailers like Rite Aid in order to manage and optimize sales and operations. This could include marketing and advertising data on customer behavior, e-commerce and website traffic metrics that monitor user habits and sales performance, and sales patterns and fluctuations found within order records.

While these examples are related to a huge retail brand like Rite Aid, it’s likely that every organization today is collecting valuable data. It’s simply being underutilized.

As mentioned, Birmingham City Council in the UK declared itself bankrupt in September 2023 due to a budget deficit of GBP 165 million annually. Yet due to the nature of its services, the council is going to have access to data on things like how transportation networks are being used, where housing is most in demand, and performance data for schools or employment sectors. These datasets could be leveraged to help bring in resources and plug the deficit gap.

The North Texas Innovation Alliance (NTXIA) is an example of this being put into action by forward-thinking government officials. They aim to boost revenue and support economic recovery using new technology solutions including data monetization.

A new class of customer for organizations

For organizations that need to monetize data, it’s important to think of it like any other product going to market. This means mapping your data against specific buyer personas that will influence how you target and sell the final product.

Although some data may already cater to specific customer segments, it’s advisable not to rule any categories out of the process. For example, a government agency with access to housing data could find potential buyers with banks that offer property mortgages or construction companies. Meanwhile, data related to how roads and parking spaces are used could be sold to a tech firm developing new transportation solutions.

However, it’s also important to acknowledge that public organizations will have to carefully consider the ethics of data monetization and how its presented to the public who fund these services through their taxes.

In this regard, public organizations need to pay close attention to which buyers they want to partner with and make sure that the project use cases will support their community with things like more affordable housing or cheaper transportation options. For example, in India data monetization is being leveraged to support innovative smart city initiatives, helping to improve quality of life and economic opportunities for residents in the long-term.

In this way data monetization can act as a ‘win-win’ solution by helping public offices generate much-needed revenue to fund projects that support the local economy and its citizens.

Setting the stage for data monetization

With the right value proposition and technology in place, organizations and public initiatives can generate high-value, recurring revenue that can be fed back into projects and impact goals such as the aforementioned development of smart city initiatives.

Prior to building data products or investing in technology solutions, organizations should determine the revenue potential of data assets and how these can be sold.

For governments and nonprofits, product options could include:

– Data monetization through subscription models and tiered access to data sets

– Custom data services that offer tailored datasets to researchers or private consultation services on insights unlocked from government-held data

– Data licensing agreements which allow specific third parties access to datasets

– Public-private partnerships in which governments collaborate with strategic business partners

– Value added products where insights and trends on public services are offered to businesses and researchers as add-on products

In order to build products and services that are available via subscription, licensing or collaborative agreements organizations need robust data collection and management systems.

These systems will ensure that complex datasets coming from a range of sources across the city can be aggregated, analyzed and anonymized while also adhering to the necessary security standards and privacy regulations at the national and international level.

Building resilience with data

It’s an uncomfortable truth that many companies and organizations are struggling to remain solvent at present. While the collapse of a large retail chain such as Rite Aid will put thousands of people to work, the collapse of public services and charities will leave even more people without access to support.

Data monetization should be considered as a core strategy in the future to help both public and private sectors build resilience and work together to deliver innovations that help citizens and economies to thrive in the long term.

This article was authored by Jeremy Bruck, Managing Partner at Gulp Data