It’s time we expect more from these providers. While today’s applications help automate business processes and address pain points at the department level, they don’t reflect the mind-blowing opportunities that now exist with data.
How SaaS Providers Should Deliver the Highest Value to Customers
The primary role of my sales team starts with helping organizations understand the benefits of bringing all their data together into the cloud. Conversations with prospective customers often start with revealing the value of providing a single source of data and universal access to that data.
The conversation often advances to the business imperative of securely sharing data across the organization, and much farther. That’s when the wheels really start turning for business and IT executives. Numerous questions arise that explore the seemingly-endless possibilities that now exist when it comes to using data:
- What new opportunities might reveal themselves if I can seamlessly share data across my organization? What if I share data with my partners and suppliers? What new market and customer opportunities can we tap into together? Can I create new data products and solutions and responsibly share or sell them to partners and customers?
- Can I buy data I’m missing to enhance my own data in order to address some of the challenges my customers face that I don’t fully understand? Do I have data I can sell via a modern data marketplace that might do the same for other organizations?
- Are there other companies I can collaborate with that have interesting customer, industry, product, or environmental data that I’m lacking? Can our combined data sets solve some real issues? Should I partner with one or more of these organizations to build new apps that address current market failures or missed opportunities?
These questions point to the power of modern data sharing and the vast opportunities to develop more targeted, transformative applications. And they also explain why my team and I now spend more and more time connecting customers across industries to facilitate new business partnerships based on data.
As for SaaS providers, making these connections isn’t outside our purview. On the contrary, it’s an integral part of assisting organizations in the identification of data opportunities that can broaden their business, increase consumption of their own data, and responsibly monetize internal data assets. We are embracing our new role as connectors, and we’re excited to help our customers use data to build more targeted and impactful data-driven solutions.
Here are some of the ways companies today are capitalizing on data’s true potential:
- Organizations partnering to develop joint solutions. An ecosystem of new data products, developed by a collaboration between two or more companies, is springing up that would never have been possible without modern data sharing. A perfect example is the partnership between ADP, a human resources management company, and Intercontinental Exchange (ICE), a Fortune 500 company that operates global exchanges. Together, they combined relevant data sets to build a joint data offering that’s being sold through a modern data marketplace. Aimed at investors in the mortgage-backed securities space, the data offering brings transparency and data consistency to municipal bond markets, which historically has been challenging to achieve. Based on this successful collaboration, ADP is now in talks with additional organizations, including a financial industry software solutions company.
- SaaS providers are creating new lines of business (LOBs). Traditionally, these providers have come from the technology sector. However, as large organizations adopt modern cloud data platforms and discover they now have the right tools to use their data, non-technology companies are moving into the SaaS space for the first time. As a result, brand-new business units are being developed to create and sell these solutions to organizations such as credit card companies, banks, grocery chains, media firms, and payroll companies. These data solutions target very specific needs for both internal and external application customers, so the value they deliver can have significant business impact, such as delivering a B2B or B2C customer experience previously unimagined.
- Organizations are building networks around shared data. Now that companies can easily and securely share live data, a mix-and-match approach is occurring with data sets and data analysis. For example, rather than rely on technology companies that specialize in Internet-related services and products, and therefore own huge amounts of consumer data, large media companies are recognizing the value of going directly to consumer goods corporations to ask about advertising on their streaming services. The media company’s data is being combined with geographic consumer behavior data to better target advertisements. This network effect provides an advantage to companies that share data.
- Companies are monetizing their data. Data marketplaces enable companies to monetize data assets by selling data to other organizations. That’s how a number of companies have built an entire ad tech business out of their customer loyalty programs. And it’s how one of the largest global airlines now monetizes its loyalty data by selling it securely in a data marketplace, and billing buyers through a consumption-based pricing model.
- Traditional supply chains are being disrupted. When organizations share their data with suppliers, a new level of transparency, efficiency, and accuracy is created around supply and demand. For example, a large supermarket chain now sells its store and inventory data to suppliers via a consumption model (suppliers only pay for the data they use). This data is proving invaluable because suppliers can see exactly how each individual store moves products and adjust inventory accordingly. The result is more efficiency in the allocation of inventory, lowered costs, minimized waste, and a stronger customer experience because shelves are stocked with relevant items for customers.
How Every Organization Becomes a Data Company
At least three innovations have opened the door for organizations to treat data as an asset that can be shared and monetized in order to deliver stronger data-driven solutions to customers.
1. Modern data sharing
A modern data architecture changes the way data is shared. Data no longer needs to be copied from its original location, transmitted, loaded into a data consumer’s database, and then transformed before it can be analyzed. In fact, with modern data sharing, data doesn’t need to be copied and moved, and therefore become stale immediately. The company providing the data can now grant access to live, governed data. Whenever the data provider updates that data, the data consumer receives those changes in real time.
Live data makes it easy to bring relevant data together from multiple sources and enables organizations to make faster, smarter business decisions. Multiple sources include data shared internally across an organization’s business units, data sets shared externally between business partners, and third-party data acquired in a data marketplace.
In fact, modern data sharing powers all value-driven use cases and is the engine that will drive the Data Economy forward.
2. Consumption-based pricing
Any SaaS company that uses cloud services is impacted by consumption pricing. Cloud providers charge these companies based on consumption, or usage, which results in them operating with a variable infrastructure cost. The more these providers use cloud services, the more it will pay for the cloud provider’s compute and storage infrastructure.
But most providers continue to offer their solutions through a subscription-based pricing model, which creates a gap between the fixed price their customers pay to use their solution, versus the amount the provider pays for cloud services based on usage.
What’s required is a consumption-based billing engine that enables SaaS providers to charge customers in the same manner in which they pay for the underlying infrastructure. This switch in pricing strategies will enable providers to control costs and scale with customer usage, and enable customers to pay for exactly what they use.
Usage-based pricing also powers the buying, selling, and sharing of data in the Data Economy. With a consumption-based billing engine, organizations are now monetizing data in a data marketplace, which enables an efficient method to securely buy and sell governed data, and access a range of data services.
3. Data security, privacy, and governance
Of course, huge responsibilities come with sharing and monetizing data directly between a data provider and a data consumer, or via a modern data marketplace. Organizations must protect their data, minimize risk of a security breach, and protect themselves from violating data privacy and data protection regulations.
Today, applications built on a modern data architecture provide built-in data governance and privacy through features such as: dynamic data masking; row-level access policies; auditing of access history; and support to track sensitive data for compliance, discovery, protection, and resource usage.
Organizations that use modern data sharing have an additional layer of security added to their live data. Data is referenced in a governed manner that protects your privacy.
Sales teams empower companies to recognize new opportunities
In sales, our relationships with customers are shifting from being solution providers, to data AND revenue generation partners. We could not be more excited to play our part in serving organizations around the globe and helping drive the Data Economy forward, especially as we watch these organizations deliver more and more innovative data products, services, and applications.
The best part is realizing that the value you receive from SaaS solutions will only grow. As more and more organizations partner with each other via data, and build an ecosystem based on data, the results will be stronger solutions where more data is working harder for you.