Everyone’s saying data analytics has gotten a lot more affordable throughout the years. With the number of tools and solutions out there in the market, here’s an idea of how much it’s going to cost you.
Quick LinksBespoke Data Analytics Solution - $$$$$
Traditional Consulting Firm - $$$$
Outsourced Analytics - $$$
Analytics Tool or Platform - $ - $$
How much is data analytics worth to you?
For the longest time, big data was exclusive to big enterprises with equally deep pockets. But the development of blockchain and cloud technology has inherently democratised the technology. Smaller players are now able to gather and leverage troves of information to gain important business insights and make better decisions.
This spells an important turning point for businesses. Not only is data-driven decision-making crucial for growth, but big data and data analytics can also open up tons of new opportunities. It can help retailers and e-commerce platforms personalise the shopping experience. It can optimise supply chains to reduce costs and improve efficiency. And it can even prevent or mitigate possible disasters.
While the democratisation of big data and analytics is certainly a good thing, it also has an important implication. If one business is using data analytics to bolster their business, then all other businesses would be compelled to use data analytics as well in order to remain competitive.
The same McKinsey survey reveals that organisations that leverage consumer insights outperform their peers by 85 percent in sales growth and 25 percent in gross margin.
Since data analytics is now far more accessible, how much will it actually cost to implement?
While the final price tag really depends on the project, the tool or solution, and the amount of data that needs to be handled, there’s definitely a certain price range to look out for. Here are four different options for data analytics.
Bespoke Data Analytics Solution
You might think that a custom analytics solution would be the best option for implementing big data across your company because it’s tailored to your specific use cases. But building your own solution from scratch is going to cost you. Just to give you an idea of how much, exactly, here’s what you’ll be paying for:
- Consultation with experts
- A team of systems and software architects
- Front and back-end developers
- System administrators
- Database analysts
- Quality assurance staff
- Project manager
- Data management
- Third-party visualisation tools
- Time and other miscellaneous resources
That’s a lot of intangible costs and an entire team of tech you’ll have to pay for and manage to get your own solution together! Their hourly rates can range from, and that can last anywhere from one to several months depending on the scale of the project.
Now, a custom data analytics solution may work for your company if it has vast stores of data, unique and specific analytics needs, and a big budget to boot. But for the medium to large enterprises out there, there may not be enough data or budget to justify this big a commitment.
Traditional consulting firm
Consulting with trusted firms like McKinsey, Bain, and Deloitte is a tried and tested way corporations apply data analytics solutions to their own businesses. In fact, investment in in-house data analytics teams and external consulting has been so high in recent years that the global analytics consulting market is worth around US$43 billion.
But while this is a reliable data analytics solution, there’s a reason only the largest corporations pour their budgets into the hands of these consulting firms: it’s going to set you back a pretty penny.
The way consulting firms price their services is shrouded in mystery. There’s no set rate card, and it depends on the size and length of the project, the problem you’re trying to solve, and the amount of data they need to work with. You’ll be paying for the team—with considerations of their number and level of experience—as well as miscellaneous costs like lodging, travel, food, and overheads.
According to an ex-consultant, the cost of the problem and the value of the solution the firm is also a factor. For example, if the firm believes their solution can save your company US$30 million, they’ll charge you 10 percent of that, which is US$3 million.
Not to mention the fact that employing a consulting firm will set you back about US$20,000 on the assessment alone.
All of that adds up to a sizeable amount. You would only really benefit from the services of a consulting firm if, like in the example above, you can potentially save something like US$30 million on daily operations. But if your operation nor your budget aren’t large enough to justify such a purchase, then we suggest you look elsewhere.
Data analytics is a very complex process. In order to reap the benefits, businesses need a systematic way of collecting, cleaning, analysing, and managing their data, which requires a lot of different moving parts.
Rather than the first option, which requires building the team and infrastructure to harness data analytics independently, or the second option, which involves a third party to do all the data analytics for you, outsourcing data analytics merges some of the pros and cons of the two.
By outsourcing data analytics, you don’t need to build anything from scratch. Outsourcing services will already have the tools and solutions in place that they can implement to your specific business needs. It’s much faster to implement than creating one from scratch or getting a consulting firm to work on the project with you.
Certain data analytics solutions also visualise your data for you too, so it’s much easier for you to read and glean actionable insights from it.
The benefit of outsourcing data analytics solutions is that it offers you the same service with greater flexibility and less cost commitment.
Do note that the cost and quality of these services vary depending on the provider. There are certain service providers that are based in places like China or India, so cultural and language differences might be an issue. There are also service providers that can set you back something like US$1,500 a week.
At DataVLT, the initial development cost for creating a “Proof of Concept” (POC) costs as little as US$5,000. They are able to save on expenses with the use of blockchain technology, which allows easy and secure dissemination of information.
Analytics tool or Platform
Cost: $ - $$
These days, there are a whole range of tools available online that can cost you anywhere from US$0 to US$10,000 per year depending on your business needs. Some of the popular free ones include DataMelt, KNIME, and OpenRefine. Click here to discover 5 free data analysis tools as your starting point.
These tools are great for businesses who are looking to employ specific data analytics solutions. OpenRefine, for example, allows businesses to clean up messy data so that it’s easier for end-users to read.
For those who are looking to experiment with data analytics, this is a good place to start. But for businesses who are looking for concrete benefits, these solutions can only offer a fragmented solution. You would need to employ a host of different tools—most of which aren’t compatible with each other—in order to have a holistic implementation of data analytics across your operations.
How much is data analytics worth to you?
The cost of an analytics solution should be directly proportionate to the value it offers your company. When picking out a data analytics solution, our recommendation is to take a look at your objectives and your budget and take it from there.
If you’re only looking at experimenting with data analytics with no real expectation of improvement then maybe a data tool is the one for you. If you have a huge budget with extremely unique data sets and specific analytics needs then maybe your operations require a customised solution (Find out key pointers to note before rushing to build your own customised, data analytics solution here).
But for most medium to large operations that are looking for the most cost-effective solution, outsourced data analytics offers the balance of the two. Solutions like DataVLT are also specifically designed with end-users in mind, so no technical skills or background in data analytics is required.
Looking to adopt data analytics and don’t know where to start? You can start a conversation with us today. DataVLT is an outsourced analytics solution that comes with a PaaS platform that helps enterprises make meaningful sense of their data. Find out how we can guide your business through its transformation journey here.
Secure, Affordable, Easier — DataVLT is an on-demand data science platform integrated with blockchain. We exist to help enterprises accelerate their growth through digital transformation by way of data analytics.
Learn more at www.datavlt.com