This payment solutions company has partnered with Suburbia to monetize its point-of-sale transaction data and create value for its clients. Due to client confidentiality, this company has chosen to remain unnamed, though every effort has been made to preserve the integrity and accuracy of their statements.
This fast-growing European company provides point-of-sale (POS) solutions as well as other payment related products and services merchants need to run their business smoothly. It specializes in several niche markets though its solutions can be found in tens of thousands of merchants.
Our goal: “Payments are becoming commoditized so we’re aiming to offer a variety of complete merchant solutions and value-add services to encourage greater customer loyalty. This will also create new growth opportunities for us as a business.”
Our problem: “As our POS systems capture millions of transactions annually, we were sitting on a mountain of data – but we weren’t doing anything with it. But this data started drawing the attention of major market research companies.
We didn’t feel comfortable working with them. They would ask for a CSV dump or ask if we could simply load the data on a USB stick and hand it to them. Once we were asked to report numbers over the phone and someone on the other end would be recording them in an Excel sheet. There are a number of things that can go wrong in these scenarios. It also doesn’t build a whole lot of trust and confidence when you see data being handled that way.”
The solution: “When we met Suburbia, what we learnt was a real eye opener for us. We learnt how our data could be useful for a financial audience. The way that different sources of ‘alternative data’ are being combined to yield new insights was really interesting to us. It made us look at our own data in a whole new light and see the possibilities.
In the beginning, the challenge for us was in making sure we provided our data to Suburbia in a form so that our merchants remain anonymous. Our clients are aware that their data is shared in an aggregated and anonymized way. But you can make some accurate inferences based on, for example, the location and time of transaction. In some cases, there are own-brand products, like a store called Bill’s that sells an item called Bill’s Burger. We took pains to ensure they couldn’t be identified based on details like that, so Bill’s Burger is just listed as a generic burger.
Our mission is for our clients to see that our POS is not just a good investment but they will also see returns on that investment. We have been investigating different propositions and potential revenue models with a small group of trusted clients or ambassadors. So they can potentially be rewarded a certain fee for every transaction processed. They didn’t even know their data could be useful and valuable for others. That’s a fantastic value-add for them and it can become a competitive advantage for us.
It’s not just the money but there’s the possibility of sharing data and insights with our customers. Imagine if they can see not just their own data, but data from across the industry that allows them to benchmark their performance.
Advice for other businesses looking to monetize their data: “It will seem like there are a lot of initial hurdles to overcome. But if you’re working with a partner for data monetization, it’s important to just get to know each other and establish a relationship of trust. Once that’s done, there are two important things to keep in mind:
First, go all in if you’re serious about monetizing your data. Don’t give out a partial data set. Commit to reliably delivering the data at the frequency specified without fail, whether it’s daily or weekly.
Secondly, don’t rush it. Monetizing your data doesn’t happen overnight and we appreciate that it’s a long cycle. It’s a journey where we’re testing and learning together with Suburbia. It’s better to get it done right than to get it done fast, especially in a business like ours.”
If you think that your business generates interesting data, please talk to us. We have a simple, confidential process that lets us evaluate the quality and potential monetary value of your data, and come back to you with a roadmap to monetization.