Alternative Data: Why You Need it & Where to Start
Highlights from the latest conversation between Mohamed Abdel Hadi, VP Product Management & Strategy, SAP Data Warehouse & Miro Dimitrov, COO, NWO.ai
Today’s most critical asset in helping companies make better strategic decisions? Data. And in order to be a successful data-driven company with a competitive edge, internal data just won’t cut it. Companies must incorporate alternative data sources into the mix in order to take advantage of data-based insights, identify microtrends before they become exponential, and to successfully make key strategic business decisions. A perfect example of an alternative data source to tap into? Insights generated by SAP Partner NWO.ai whose solution harnesses machine learning techniques and human metadata to identify global cultural shifts early and throughout the lifecycle of trends.
The biggest challenges facing the alternative data era
As the complexity of companies and their source systems are growing at a rapid pace, business leaders are facing extreme difficulty in effectively managing these expanding systems of data. The complicated and time-consuming onboarding of data is simply not an option for organizations that need to operate efficiently and with agility. Organizations need a seamless and simple solution for accessing and onboarding data, while simultaneously preparing their systems for the cloud.
Leveraging the e-Commerce data boom
One of the ways that companies can take advantage of alternative data is by taking advantage of the huge amount of data being created every day due to the explosive growth of e-Commerce and reformed consumer behavior. The shift to online purchasing as a result of COVID-10 coupled with the dramatic increase in direct-to-consumer business models has created a new world of previously untapped data sources such as 1st party data streaming in directly from the consumer. SAP customer Zalando has millions of transactions in its SAP systems, and millions of touchpoints on their website as well as in their stores. This giant amount of data must be managed and analyzed in order to best understand the customer interaction with the company. In order to achieve their goal of being a data-driven company, companies like Zalando need the right systems in place to properly benefit from and leverage this explosion in data.
The “outside-in” approach for those looking to embark on their alternative data journey
For business leaders looking to start incorporating alternative data, going with an outside-in analytics approach that can help them build a competitive advantage. The most valuable data to utilize is external: benchmark data, economic data, and for example, NWO.ai data which can provide insights on product microtrends, impact, and forward-looking insights. Looking at projections and market analysis based on the past isn’t enough: Companies must combine data from various sources, and put metrics on qualitative data in order to forecast consumer interest and predict what will happen next, while also unlocking the drivers pushing these trends.
Where SAP Data Marketplace & NWO.ai come in
SAP brings the technical foundation and a one-stop-shop via SAP Data Marketplace for data analytics professions to source data and come together within a data ecosystem. Customers can now incorporate SAP & non-SAP data together harmoniously in a quick and efficient manner with SAP Data Marketplace. As one of the first data providers to join SAP Data Marketplace, NWO.ai enables businesses and IT users to directly consume partner data offerings available on SAP Store. With NWO.ai, customers can plan ahead, and for example, use SAP data for demand together with NWO.ai for trends in order to improve overall demand planning.
Looking ahead: the future of alternative data
Clear skies and creating a strong data culture are in the forecast. While the technology to process the data exists, very few company employees are actually actively using the data. Companies will need to jump from the 1% of employees actively utilizing data to 10% in order to keep up with the competition. One more thing: Be on the lookout for easy-to-use solutions for business users that will help them gain insights from available alternative data.