Instead of investing in building your data infrastructure in-house, you bought third-party data tools to collect, store and process your data while using Excel to get answers and burning through money on something that you will eventually lose control of. Yes, I know – your business grew and you didn’t have the resources or the knowledge to maintain data in house, but further down the road, these tools will really cost you.
You have a product, so members of that team want to collect data about the user and how they are using the product. Then you have the marketing team who want to track the user’s conversions and spend more advertising money. While all of this is great, one thing I see too often is companies using the same tools to solve the same problems. When organizations grow quickly, you tend to have various functions or groups of staff asking for different tools to optimize their work and track events, but this is how you end up with two or more tracking tools, two or more data aggregators, and ultimately, an urgent need for your own data warehouse to store all this data.
Growing your business
When a business grows fast, this requires trade-offs. When it comes to the tools we use, we should take the time to compare them and select the ones that will help us move forward. With many of our clients, we soon discover that they are using multiple tools, many with the same capabilities, except one was nominated by the product team and another was selected by the marketing team. Somehow, nobody mapped the crossover between them.
Work with your data but reduce the tools you use. We can’t talk about first-party data or general company data without getting that chill feeling that we don’t know how to deal with it. This prompts us to get help from third-party partners. It’s okay – not everything can be built in house, and this is coming from someone who used to push for everything to be built in house. However, when you decide that you want to go in this direction, ensure that you don’t duplicate your tools. Avoid subscribing to a new service before you can cancel the old one if you’re introducing a tool that can do the same work.
Think privacy-first when you select your tools. Remember, being privacy-focused doesn’t just mean doing your utmost to keep your user’s data safe, but also, to actively work on reducing your user’s data exposure to third parties if not completely necessary, to track and store as much data as possible in house, and in general, streamline who has access to the data in a secure, multi-layer data infrastructure. Don’t forget, your user needs to feel that their data is safe and comfortable with how you are using it. This means you should communicate with them to explain what you do and how you do it.
Do you feel like you are using too many tools? I love this part! If you believe you have too many tools, put them in a list like the one below with each of their main features. I think it’s so helpful to be able to see all your tools, what they do and who they are used by.
|Cost per month
How to store your data tools list?
When you list all your tools like this, you will be able to see which ones overlap, how much they cost and when they end so you know when to cancel them. Be sure to stay on top of new tools and always compare them to the list. Try to be proactive in investigating each tool and find out what else they offer before you subscribe to yet another one.
It’s tough – I feel your pain – so let’s focus on changing data culture. Let’s try not to overspend or share data with third parties if we don’t need to. Let’s chat and find out what’s working and what isn’t. Let’s work out how to set up a data infrastructure at a minimum cost to you and your company, because all this money you spend on tools costs a lot more than storing and maintaining data yourself. There are so many services that are available for free these days that could help you achieve your goals on AWS, so why waste your time and money on running around booking countless tools without even checking whether they will work or not.
Having a data strategy in place will help you map what you need, how you need it and what tools can cover it for you. Great communication between the marketing, product, finance and tech teams will also help to reduce costs and stay focussed on the mission: to make your users happy by maintaining a healthy data infrastructure.