How to Treat Data as a Competitive Asset

How to Treat Data as a Competitive Asset

April 15, 2020

Niometrics Vice President of Insights Luis Rezende discusses data monetization via customer experience, financial investment and marketing.

By Luis Rezende

The Asia Pacific is going digital – and going at it with much vigour. This results in a great amount of untapped data being generated that businesses across industries can leverage for greater organisational efficiency and economic outcomes.

The number of mobile connected devices in this region is expected to reach 6.6 billion by 2023 from 4.7 billion in 2018, making up for 1.5 mobile connected devices per capita by 2023 – an increase from 1.1 per capita in 2018. That means by 2023, mobile subscribers as a percentage of regional population is forecasted to be 72 per cent, an increase from 65 per cent in 2018.

This surge in mobile subscribers will see a hike in mobile applications being downloaded – in fact, about 183.2 billion mobile applications according to the Cisco Annual Internet Report (2018-2023) White Paper, with 71.6 billion coming from social networking, messaging, media, productivity and e-commerce mobile apps. Consequently, the average fixed broadband speed, Wi-Fi speeds from mobile devices and mobile connection speed, and total public Wi-Fi hotspots and homespots will grow further.

The onset of 5G in the region will drive many service providers to upgrade their infrastructure to functionally house the network. With multi-Gbps peak rates, ultra-low latency, larger capacity and a more consistent user experience, 5G will deliver on performance and efficiencies, paving the way for greater interconnectivity and control over machines, objects and devices. For communication service providers (CSPs), this presents a multitude of opportunities but are largely untapped.

Unlocking new revenue streams

The size of the potential global digital advertising market that CSPs can command is USD 300 billion, even if they only play a small role in the delivery of digital advertising.

Data on network utilisation enables more effective network control and management, which strengthens the alignment of network capabilities to a telco’s overall business by increasing revenues, reducing expenses and potentially improving network ROI by up to 15 per cent.

According to a statistical analysis by McKinsey it found a correlation in the profits of companies, with their capital and labour investment and use of big data.

In the study, one company used analytics to predict periods of heaviest network usage coming from video steaming and had accordingly relieved congestion during those times, reducing planned capital expenditures by 15 per cent.

Another had improved the recovery of payments by 35 per cent by analysing a combination of sociodemographic data, information from customer touchpoints (such as call centres and social media) and data on network usage to identify, in real time, the customers with the highest likelihood to defect or have trouble paying their bills.

Telco networks generate data such as subscription details and preferences, location, usage details, demographics and personal information, app and content usage, and how users respond to digital advertisements. Such data can be meaningfully used to drive business value across three key dimensions: customer experience, financial investments, and marketing and data monetisation.

Providers can craft an enhanced digital experience for consumers by understanding the granular details of how they use the networks. Businesses can make wiser investment decisions to enhance the network by analysing the right and exact demands.

For instance, mobile location data and linger times had identified 61,000 unique visitors who stayed at the 80th Antwerp Book Fair for at least one hour. CRM and network data related to roaming allowed the identification of country or region of origin – which can be used for better target marketing for future events.

Data can also help venues and events to maximise on marketing opportunities. The Phoenix Suns’ basketball team and sporting venue had used data analytics to target likely season ticket purchasers and identify which potential sponsors will gain the most benefit. The Purchasing Managers’ Index (PMI) used location and CRM data, with correlated third-party data and some mobile behaviour tracking to profile the typical crowd at games.

Treat data as a competitive asset

While data is recognised and utilised to form modern solutions to increase business and organisational efficiencies, many CSPs are still not capitalising on such opportunities. In fact, only 10 per cent of CSPs are prioritising monetising data, despite focusing on machine learning and analytics tools to achieve internal efficiencies.

This could be credited to the difficult nature surrounding data extraction to derive true value – highlighting road bumps including the lack of organisational focus and availability of the right tools, and the siloed nature of organisations and the dispersion of data across disparate systems.

In the Asia Pacific region, only 4 out of 10 CSPs are equipped with advanced visualisation capabilities to understand what’s happening with their networks at any time, or with an architected approach to data and organisation-wide policies to standardise data collection and storage.

Superior network performance and customer experience is the top CSP selection criterion for organisations in the region, with 41 per cent of Asia Pacific respondents making the switch to a competitor because they were dissatisfied with their telco’s performance. It is no wonder that 70 per cent of CSPs in the region consider keeping up with rapidly changing customer preferences and requirements as the top challenge that they face, among others.

Sixty-eight per cent of CSPs reported that another business challenge lies in the intensifying competition from traditional and non-traditional players (such as Internet companies and over-the-top players (OTTs)), who are able to do a better job at using data in smart ways. On the other hand, 56 per cent of CSPs find it a challenge to deal with regulatory uncertainty that impacts data monetisation efforts.

With a methodical approach, CSPs can monetise data by focusing on the following:

Data relevance and availablility

Make data available for analysis in a secure manner with the right set of infrastructure, tools and governance policies. CSPs should have means in place to securely capture, store, process, and analyse the data generated by its network and business.

Ensuring the security and compliance of external usage of data is an important consideration on the potential impact on customer privacy. Necessary safeguards should be fundamental to the design of data monetisation products – in most cases, CSPs should sell products from the analysis and not the raw data. This reasons that in addition to the technology, the ability to execute on the insights is paramount and hence should be at the heart of all analytics strategies.

Meet a real market need

Products developed will only be valuable if they meet a real market need. As such, data and analysis must be presented in a usable, case-specific way to be immediately useful to the target market. This starts with understanding the needs and demands of the target market, knowing how to connect with them, and knowing how they would use the network.

However, meeting a real market need may require capabilities outside of the organisation. CSPs should leverage on complimentary adjacencies. For some, working with an aggregator platform to reduce the technology investment and letting someone else take care of the path to market might be more suitable.

At Niometrics, we partner with some of the largest CSPs in the world that leverage our proprietary Deep Network Analytics tech to generate intelligence – we’ve since analysed a combined base of over 500 million subscribers who consume and exchange over 60 petabytes (PB) of data each day.

Our technology has allowed CSPs to engage in data discovery, providing them with hyper-granular insights that enable them to extract deeper value from data. This empowers CSPs to position themselves as wise leaders in the sectors they serve, while protecting data privacy and security through engineering that embeds encryption and anonymisation into every stage of the data processing pipeline.

Staying ahead of the curve

Consumers and enterprises are expecting their devices to deliver on all fronts, including quality, connectivity, speed, and personalisation of content and promotions. In doing so, broadband and mobile networks have become core pillars of modern society.

Revenues based on understanding network workloads are increasingly becoming an essential component of the business model for CSPs to stay competitive. It has become a race for telcos to put together the right set of network analytics tools and solutions to offer an integrated solution that can handle carrier-grade data volumes in real time against the ever fast-changing landscape, while maintaining the highest level of security and sustainability. Those who succeed today, will be the pioneers of tomorrow.

(Ed. Niometrics Vice President of Insights Luis Rezende says he looks at existing problems in novel ways to come up with creative solutions. Rezende has an MBA with distinction from London Business School, and a Bachelor of Science in Industrial Engineering from Escola Politecnica, Universidade de Sao Paulo.)


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