Data has evolved, becoming a new form of currency for industries around the world, particularly in Asia. The economic enhancement in Asian countries has been facilitated by the digital transformation, which has facilitated numerous opportunities through diverse applications of data.
One emerging trend among businesses is data monetization, which involves transforming raw data into revenue streams. This includes selling data to third parties, sharing data for favorable business terms, and providing information services or products based on data assets, which can be completed independently, through brokers, or through partnerships with other organizations.
Studies show that the current global data monetization market is growing and is expected to reach USD 14.4 billion by 2032 with a compound annual growth rate (CAGR) of 16.6%.
Data Monetization in Different Industries
In order to successfully monetize data, it is essential to select an appropriate and suitable data source. For example, FinScore has effectively leveraged mobile SIM card usage statistics in order to generate consumer credit scores in the Philippines. To do this, FinScore uses a secure application programming interface that has been recognized by mobile operators in order to guarantee the usefulness and safety of the data. Selecting an effective data source involves addressing challenges and difficulties faced by consumers. The data source needs to undergo thorough testing to prove its reliability in offering valuable insights.
Asia's growing e-commerce market, particularly in countries like China and India, has delivered a huge amount of consumer data. This data could provide companies with valuable insights into consumer behavior, preferences, and purchasing patterns. Understanding customer needs allows businesses to customize their products and services, ultimately boosting customer satisfaction and experience.
The technological advancement and urbanization in the region paved the way for the development of smart cities and industries within countries. Data also plays a crucial role in the daily operation and processes within smart cities and is essential to improve urban infrastructures. Data monetization can help city planners to make well-informed decisions for sustainable development, covering areas such as traffic management and energy consumption, which can also provide opportunities for technology companies to offer innovative solutions that improve daily living.
Utilizing Data Monetization’s Potential
Monetizing data does not only encompass cutting costs; it's about discovering new revenue streams and transitioning companies into data-driven organizations. Businesses can maximize value extraction, improve cost efficiency, and unlock new revenue streams by adopting holistic approaches.
Data-driven business transformation relies on a solid data monetization strategy and effectively leveraging data products. Data and AI automation insights not only help optimize costs but also strengthen security and compliance. These effects encompass enhanced compliance, productivity, and efficiency throughout different business departments, resulting in increased revenue.
Transforming raw data into products and services that can be monetized requires a complicated procedure. For instance, Google’s analysis of data collected from user searches— the company effectively identifies patterns and behaviors exhibited by customers or users and uses this data to enhance their advertising targeting services, which ultimately results in an increase in revenue.
Another technology which is an effective tool for data monetization is Web3 or the decentralized web. Web3 introduces decentralization and blockchain technology, which is being used in various sectors in Southeast Asia, particularly by online content creators. The implementation of this technology gives independent creators the ability to directly monetize their work, making the process of content creation more accessible, expanding its global reach.
Data monetization may offer benefits and new revenue opportunities, but it has also received negative responses and criticism due the risks and (sometimes) unethical usage of data. In recent years, there have been growing concerns regarding data privacy due to the rapid increase in data accumulation, which has resulted in the introduction of regulations.
Dealing with regulatory challenges can be difficult for businesses that operate internationally due to its constant evolving nature. It is also essential for businesses to carefully consider ethics when utilizing data to prevent potential negative consequences on public perception and reputation.
Effective data monetization requires a comprehensive strategy that focuses on compliance, security, and ethical standards. Thus, businesses could invest in advanced technologies like AI and machine learning (ML) to extract valuable insights from data, all while ensuring stringent security measures are in place.
