Case Study

Modernizing a revenue and license model to deliver 10% growth for a data business

See how we boosted revenue for a Europe-based stock exchange

Opportunity/Issue

A stock exchange sought clear, transparent, cost-based pricing to ensure European Union’s MiFID II compliance.

In response to the European Union’s MiFID II regulatory framework, a stock exchange needed to modernize the pricing model for its data services business. The objective was to establish clear, transparent pricing guidelines that ensured regulatory compliance through a cost-based approach.

Our team stepped in to develop a pricing model that would also align with changing client needs and market conditions.

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Approach/Solution

We developed a cost-based pricing model by analyzing current structures, benchmarking peers, consulting experts, and simulating impact.

We analyzed the existing pricing model, looking at cost and pricing structures, and how well it meets business and compliance objectives. Then we benchmarked various license models used by other leading exchanges and performed a comprehensive cost analysis. Additionally, we conducted interviews with industry experts to understand the nuances and potential pitfalls of different pricing strategies.

Using these inputs, we developed a new pricing model tailored to the specific needs of the client's data business unit. This model more accurately reflects the data consumption and was designed to be more flexible and responsive to market demands.

Before implementing the new revenue and license model, we simulated its impact on key client segments to test for feasibility and effectiveness.

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Outcome/Result

The new pricing strategy delivered a 10% growth for the data business unit.

The new pricing strategy led to a 10% increase in revenue for the data business unit. We also recommended annual reviews to account for cost fluctuations in a volatile interest rate environment. Additionally, we developed a communication plan to help the stock exchange’s clients understand the new changes and their benefits.

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