In this era of data abundance, it can be tough to formulate a distinctive and successful business strategy that actually leverages data and gives you the growth you are seeking. Tom Monahan, founder and managing partner of Norton Street Capital and a board member of TransUnion, shed some light on how to accomplish this successfully at the 2019 WealthEngine Prosper Summit.
The way organizations use data to engage with clients and prospects in positive and helpful ways is constantly evolving. Companies shouldn’t look at data as a way to make money but instead, see it as an opportunity to genuinely help their clients.
For example, if you’re an investment manager trying to help wealthy people better manage their money, you can use wealth screening. This is a powerful tool that enables you to pinpoint areas where your clients can be more efficient in their investing. Of course, you would make money off that data, but so would your clients, making it mutually beneficial.
Not only are corporations using data to prospect or get new clients, but companies are also able to leverage data to develop better products and improve internal processes.
As a leader in an organization formulating a data strategy, it’s imperative to ask the right questions. Here are some questions you should ask to help build a successful business strategy:
The point of asking these questions is for everyone to learn something new. It also provides an opportunity to think about how you can create a distinctive strategy for growth. Considering these things also helps to ensure you’re using the data you have available in an ethical manner.
WealthEngine enables building a powerful data strategy with its WealthScoring data analysis. With WealthEngine’s Propensity to Give (P2G) Score, your organization will be able to correctly identify and prioritize those most likely to give. A P2G Score of 1/0 is optimal.
As a strategist, it’s important to think about the compounding benefits of good strategic decisions, for long-term growth. How are you going to engage the customer so that you not only gain them as a client but are able to retain them as well?
It’s not enough to simply have unique data either. You must have a plan for that data.
For example, the Union Pacific Railroad needs data that’s extremely valuable to them. However, for most people, this information would serve no purpose. The data in their positive train control system helps prevent derailments by taking in the track temperature, speed, and other important measurements throughout their system. This data makes it possible to predict situations before they happen.
While it’s important for a train engineer to know what the temperature of the track will be four hours down the line. The average person does not need or know how to apply this information.
To successfully distinguish your organization within your industry, you should have data that’s unique for you, and have a way to apply it that generates genuine value. A recent webinar with Infutor, one of WealthEngine’s partners, examines the the hidden predictors that signal your top prospects. This information allows you to personalize your messaging to effectively target these donors.
How you structure your data should help you understand this information in a way no one else can. You most likely have an abundance of data at your disposal, but how you stage and structure it is going to affect your strategy.
The best thing you can do with data is to use it to predict something no one else can. Just as the Union Pacific Railroad has, find a way to use your data that makes it valuable to some and like magic to others.
What can you do with data to help you truly excel? How is what you’re doing valuable to others? Figure out what specific value your data can create and see how that fits into your company’s strategy.
Of course, as an organization you want to make money, so how can you extract monetary value from this data? In a successful business strategy, you’re extracting data that helps people and brings you more income.
The term “data is the new oil”, has been thrown around a lot lately. It was originally said by modern data use pioneer Clive Humby, and it has sparked quite the online debate.
The prevailing online argument about this quote revolves around the question of whether data is indeed the new oil in terms of its value. Some take the position that data is not the new oil because data is renewable while oil is not.
Take a look at this Google trends map and you see blog posts on both sides arguing the simple statement “data is the new oil.”
Blue= Data is the new oil
Red = Data is not the new oil
What this really shows is how the internet can take information and then make large leaps, instigating a heated argument. There are great points on both sides of this particular debate. However, it is important to note that what is being so vigorously argued is a shortened, clipped version of what Humby stated.
We believe accurate data is extremely valuable, and find what Humby actually said much more profound than the distorted quote that is often attributed to him:
“Data is the new oil, it’s valuable, but if unrefined, it cannot really be used. It has to be changed into gas, plastic, chemicals, et cetera. Create a valuable entity that drives profitable activity. Data must be broken down and analyzed for [it to] have value.”
Essentially, like oil, data is nothing unless it is refined. If oil isn’t turned into gas, it can’t be used in your car. If data isn’t turned into something with valuable practical applications, it’s worth as little as salt.
Ultimately, you as a business leader need to leverage your data and turn it into something valuable. The most important piece of a successful business strategy is the ability to take something that’s worth nothing to others and recognize its value for the right people.
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