What is Alternative Data?

Alternative data describes non-traditional datasets that can shed light on consumer spending, corporate trends, new markets, bigger industry shifts, and so much more.

While traditional data can include items like financial statements and SEC filings, alternative data can cover an array of unconventional datasets from a variety of sources, including (but not limited to):

• Debit and credit card transactions

• CPG and SKU data

• App usage

• Satellite imagery

• Social media and/or web traffic

As such, alternative data can be invaluable to researchers, analysts, investors, retailers, and many others by:

1. Revealing novel patterns, trends, insights, and relationships that traditional data simply cannot capture or divulge

2. Helping key decision-makers make more prudent choices, refine current strategies, and discover all-new opportunities to advance growth

3. Uncovering potential risks and major industry shifts before they’re widely known or on competitors’ radars

4. Gaining or sharpening a competitive edge within a given market or even across entire industries

To do that, alternative data insights unveil critical findings related to:

• Consumer behavior: Customer shopping and spending trends can clearly emerge from transaction data, credit card data, and several other forms of alternative data. From dialing into consumer sentiment and preferences to discovering consumer spending trends by generation, these alternative data insights can help top players and companies keep their fingers on the pulse of consumer behaviors. That can fuel the ability to get ahead of demand, stay ahead of the curve, and identify potential winners in certain sectors right out of the gate.

• Supply chain analysis: The transportation, logistics, and manufacturing sectors can access real-time insights into practically every point in their supply chains with shipping data, satellite imagery, and other alternative data. That can deliver game-changing awareness and understanding of bottlenecks and disruptions, as well as inventory levels, production capacity, shipment statuses and timelines, and so much more.

• Company “health” and performance: Before financial statements and quarterly reports are released, alternative data sources can share useful indicators of an organization’s growth, financial health, and overall performance, both in a specific market and across wider landscapes. With that, business leaders, investors, and others can assess brand sentiment, gauge consumer interest, identify growth trends and opportunities, and better understand the “health” of a company in real time. Some alternative datasets also empower robust competitive benchmarking for next-level insights.

• Bigger economic trends: Hiring trends, industry developments, and macroeconomic shifts can emerge from alternative datasets, providing a bird’s-eye view with actionable information and insights. These can be applied to specific sectors and strategies while highlighting best-fit options for wider-reaching objectives and longer-term needs.

Ultimately, alternative datasets can deliver the information, awareness, and insights needed to effectively navigate the increasingly complex landscape of the data-driven business world.