Dive Brief:

• The vast majority (90%) of small and medium sized businesses are modernizing their approach to data management, but only 42% are using data to drive growth, according to a survey by Amazon Web Services.

• The survey findings, which were highlighted in a Monday blog post, underscore both the challenges and opportunities for SMBs that aren’t yet realizing the full value of their data assets, according to Ben Schreiner, head of innovation at AWS.

• “The struggle for a lot of these companies is that their data is residing in silos all over the organization,” Schreiner said in an interview. Moving data into the cloud allows companies to more easily leverage the information using analytics and AI tools, he said.

Dive Insight:

Many SMBs have begun a cloud migration journey but still have large amounts of siloed and disconnected data, according to the blog post. “This means the data can provide only a piece of the picture, rather than a complete view,” it said. “The full potential of the data is unrealized, leaving businesses with missed opportunities.”  

The push for cloud spending comes at a time when market demand has been slowing amid economic uncertainty.

AWS’ net sales in the first quarter grew 16% year over year to $21.4 billion, according to results released in April. This represented a decline in sales growth for the fifth straight quarter, according to Bloomberg.

“As expected, customers continue to evaluate ways to optimize their cloud spending in response to these tough economic conditions,” Amazon CFO Brian Olsavsky said during an earnings call at the time.

In its Monday blog post, AWS said migration to the cloud represents only a first step toward leveraging valuable data. “With the right tools, the cloud provides an opportunity to first collect, then convert data across the company into powerful insights,” the post said.

In one example, AWS helped FreeCast, a medium-sized content platform, to merge customer segment information with site click data in an AWS “data lake” — a centralized repository, according to the post. This resulted in benefits such as increased visibility into ad revenue attribution, it said.

Besides disorganized and disconnected data systems, obstacles to data-driven growth include lack of education, AWS reported. More than half of SMBs don’t have the knowledge or experience to drive growth using data, which leaves them “stuck wondering what to do,” it said.

SMBs are also inundated by multiple layers of information, provided in both structured formats, such as spreadsheets, as well as unstructured ones, such as images, videos, and chat conversations, AWS said.

According to the survey, top areas of focus for data-driven SMBs include developing new products, services and markets (57%); improving productivity and efficiency (55%); driving sales and marketing (49%); and reducing costs (35%).

“Alternatively, businesses that aren’t using data to drive growth are at a competitive disadvantage,” the post said.

AWS surveyed more than 800 C-suite executives, vice presidents, and directors from SMBs across the globe representing multiple industries.