We’ve all heard the hype around all things Big Data and analytics, but where does the rubber meet the road? When somebody reaches into the piggy bank to pay for technology or services.
Having worked with companies ranging from heavy manufacturing to financial services, my colleagues and I at InterSystems have detected a few buying trends. We’ve tried to correlate this on-the-ground observation with the findings of recent analyst reports, including:
- 2015 Big Data and Analytics Survey by IDG Enterprise
- 2014 Big Data Research Study by QuinStreet Enterprise
- 2013 Emerging Returns on Big Data, Tata Consulting Services
- 2014 Wikibon Big Data Vendor Revenue and Market Forecast
Before delving further, we’ll need a few definitions:
- Small businesses are defined as organizations with fewer than 100 employees and less than $50 million in annual revenue.
- Midsize enterprises have 100 to 999 employees and make from $50 million to $1 billion in annual revenue.
- Large enterprises report $1 billion in revenue and up.
Let’s delve further into the spending data now.
Question 1: What type of organizations are spending money on Big Data, and what are they actually spending?
Reports Summary: The average spending on Big Data is $7.4 million (USD) a year. Midsize and large enterprises are spending the most. Small to medium businesses (SMBs) are averaging $1.6 million USD. IDG’s graphic summary is below:
On-the-ground findings: The organizations we work with are dominated by mid-sized to large enterprises. These enterprises have been in a business for 10 years or more and want what most organizations want: to make better data-driven decisions. This has a substantial impact on operational efficiencies, especially in the largest organizations, where a small percentage improvement can result in millions saved.
Question 2: What industry sectors are spending money on Big Data?
Reports Summary: The sectors investing in Big Data include general high tech, government, banking/financial services, manufacturing, healthcare, telecommunications, energy, utilities, media and entertainment, retail, insurance, life sciences, and travel/hospitality/airlines.
The three leaders in spending are telecommunications, travel/hospitality/airlines, and banking/financial services.
On-the-ground findings: This finding matches our experience in the banking/financial services sector, but we see significant increases in healthcare as well, driven by the need for point-of-care analytics.
Question 3: Where are the sectors spending their money?
Reports Summary: For this summary, I’ll just refer to where the vendors are making revenue, according to Wikibon:
On-the-ground findings: The spending on professional services is not surprising to us. We are consistently seeing that technology alone is not enough, and there are simply too many choices when it comes to Big Data solutions. This creates a need for professional services to not only assist in the selection of the technology, but to simply augment the staff needed to leverage the technology, given the current lack of skilled professionals.
Question 4: Why are they spending money?
Reports Summary: The top reasons given as to why companies are spending money are:
- Improve the quality of the decision-making
- Improve planning and forecasting
- Increase the speed of decision-making
On-the-ground findings: Data-driven decision-making dominates all our current customer engagements as the number one driver to invest in Big Data technologies and services. To find success in Big Data, it must be leveraged at the heart of the business to yield consistent on-demand intelligence.