Marketers and business folks love the expression, “Data is the new oil”, and I find it apt. Like oil, data has incredible potential to change and transform business. The energy surplus of the last century was powered mainly by oil, in the sense that oil vastly amplified the amount of work our species does.
There’s another reason I love this expression.
Crude Oil Is Useless
When I was in high school, our school was located across the street from an ExxonMobil laboratory complex, and as budding scientists of the future, we took field trips to the facility. We had opportunities to work with oil, understand it, see how refining changes it, and explore the chemistry behind it.
We also had the pleasure of taking home a souvenir one-gallon can of crude oil as part of the annual field trip. I kept mine for a few years before disposing of it.
Why? Because crude oil is nearly useless. It smells bad, it’s thick, it stains just about anything it touches, and other than burn with a thick, acrid, black smoke, it does nothing useful.
The Value of Oil
Oil’s usefulness comes from three steps:
- Extract it from the ground as inexpensively as possible.
- Refine it to turn into more complex hydrocarbons like gasoline.
- Distribute those products to customers who use them.
Does that sound familiar, as a marketer? It should.
The Value of Data
Data’s usefulness comes from three steps, too:
- Extract the data at scale, as efficiently as possible.
- Refine the data, transforming it into models, insights, analysis, and strategy.
- Distribute actionable insights to the business users to take action on.
If oil needs extraction from the ground via wells and drills, refining in a refinery, and distribution via a network of petroleum product distributors, what of data?
The Data Refining Process
If we extend this analogy to people, to make data useful, we need three kinds of people to capture the value of data as the new oil:
We need developers to extract the data from sources, using APIs and databases to make the process efficient.
We need data scientists (and artificial intelligence) to transform the crude data into refined, usable products.
We need marketing technologists to take the data products to business users so they can power their business efforts.
Where is your data refinery? Do you have the required people to extract data, refine it, and distribute useful data products to business users? If not, this is your blueprint to get started.
You might also enjoy:
- AI for Marketers, Third Edition, Available Now!
- Google Analytics 4 or Bust: Lessons from Google Marketing Live 2021
- Six Types of Marketing Demand Generation
- The Year of the Yin Metal Ox
- How to Set Your Public Speaking Fee
Want to read more like this from Christopher Penn? Get updates here:
Get your copy of AI For Marketers