Benchmarking Case Studies
Benchmarking is a great way to monetize data that your business already has (or has access to), and can lead to new revenue streams and increased product fidelity. Here are a few case studies that illustrate various use cases for selling benchmarking metrics to customers. But first…
What is Benchmarking?
Benchmarking is the process of providing a comparison between a subject and a broader population to determine performance. In the world of data monetization, benchmarking refers to the practice of comparing a businesses performance to that of similar businesses via aggregate data.
An important note - the benchmark data you sell to your customers needs to represent a population that provides a relevant comparison to the business consuming this data. This topic warrants a separate blog post, so for now we’ll focus on benchmarking from a functional and business value perspective. Stay tuned for a post about how to fine tune your benchmark data to appeal to the individual entity.
Case Study #1 - Esports Company
A prominent esports company is planning their tournament schedule, and decides to make a new offering to their participants: a paid scouting service that provides behavioral metrics on teams’ opponents.
With all of the data this company has collected (and had players opt-into), it can provide detailed and accurate information about player behaviors and provide this information in a meaningful way to teams training for the competition. The company builds an online portal for players to use, and sells access at a premium. Players can now conduct reconnaissance on their opponents, as well as benchmark their own statistics against other individuals and the broader population.
This offering has both a short term and long term advantage. In the short term, the company recognizes new revenue from this offering via product subscription fees. In the long term, this offering has the potential to increase participation and viewership by virtue of up-leveling the competition.
Case Study #2 - Real Estate Market Data Provider
A company whose sole business is monetizing data collects, aggregates, and presents industry benchmark data to paying customers. They target both individual investors as well as businesses and conglomerates looking to capitalize on the short term rental market.
The types of metrics include valuable data points such as Occupancy Rates and Average Nightly Rates, as well as proprietary calculations such as a scoring mechanism, and investors can compare their listing metrics to similar listings and determine what they can improve (e.g. quality of description, number of photos in listing, amenities, etc.). This is benchmarking in its most classic sense.
Due to the underlying cost of acquiring this data from deals it has brokered with prominent short term rental brokers, this company has a unique position in the data marketplace and is able to charge high and granular premiums. Access to this coveted data is sold using a multi-tiered approach as well as custom pricing for unlimited and enterprise/custom use.
Case Study #3 - Online eCommerce Platform
A prominent eCommerce platform provides its customers with insights into how their businesses are performing relative to a population. In a market where customers are monitoring ROAS diligently, understanding how their returns are stacking up to like businesses is essential. The benchmarking offering allows sellers to compare metrics such as conversion rates over time, session details, and more.
Pricing follows a familiar pattern with a basic, mid and advanced subscription, with varying levels of data access and interactivity across the three tiers. This company can fine tune their pricing mechanism over time - as historical subscription data accumulates, the value that each tier provides to customers is illuminated.
Case Study #4 - Healthcare Data Aggregator
An up and coming healthcare company acquires, aggregates, and applies ML to large sets of healthcare claims data. They provide a portal to paying customers that allows for valuable in-site analytics and data extracts.
How is this benchmarking and not just plain old data sales?
They offer the ability to compare a single hospital, procedure, or other healthcare aspect to the broader population directly in the app. For example, if a hospital is curious about how their prices for a given procedure stack up against the population, they can compare their rates side-by-side with the national average, and filter down to a relevant comparative sample size.
Given that the underlying data used is all public data, the value-add comes from the curation and presentation of this data to customers. If you’ve worked in the healthcare space, particularly in revenue cycle management, you might know how incredibly complicated this data can be - having it curated and pre-packaged is worth a premium.
Where to Start?
If you aren’t sure if or how your company could implement benchmarking as a data monetization strategy, start with understanding the true value of the aggregate data your company could realistically provide to its customers. Would your existing customers benefit from insights about your broader customer base? Would new customers sign up for access to that data alone?
If the answer to either of those questions is yes, it’s likely worth taking a deeper look into the potential ROI of building benchmarking into your product and business model.
