Top 6 Cost-Effective Ways To Label Machine Learning Datasets

published on: 15 March 2023 last updated on: 01 April 2023
Machine Learning Datasets

Data labeling is a critical process in machine learning that involves annotating data with relevant labels to help algorithms understand and interpret the data. However, it can be a time-consuming and expensive process. The high price for data annotation can be a significant barrier for many organizations looking to leverage machine learning technologies to gain insights into their data. Fortunately, there is a cost-effective solution: outsourcing data labeling.

It’s easy to understand why outsourcing data labeling has grown in popularity in recent years. Hiring a professional team gives businesses access to a pool of qualified experts who can provide high-quality data annotation services at a fraction of the price of an in-house team.

Read on to explore the benefits of outsourcing data labeling, including cost savings, efficiency, and accuracy, and find out how it can help your organization save money and achieve better results. Below, you can also discover the key tips that businesses like yours should consider for reducing the cost of data annotation.

Key Tips For Reducing Costs Of Data Annotation

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While outsourcing data labeling can save organizations a significant amount of money, there are additional steps you can take to further maximize your return on investment. Here are some tips to consider for reducing the costs of your data annotation:

  • Attempt to achieve balance in your datasets: It is important to ensure that your datasets are balanced and representative of the real-world scenarios you are trying to model. This can reduce the number of unnecessary labels required, leading to saved expenses.
  • Understand the impact of quality assurance (QA): While QA is essential for ensuring high-quality labeled data, it also can increase the cost of your AI project. Understanding the overall need and the level of QA required for your project, as well as how to optimize it, will reduce overall spending.
  • Allow for changes in project scope and emphasis in the budget: Data annotation projects can be complex, and changes to the scope or emphasis of the project can occur. Allowing for flexibility in the budget can manage these changes without impacting the overall cost of the project.
  • Identify the variables that may influence your per-label price: The price of data labeling can vary based on various factors such as project complexity, annotation type, and quality requirements. Identifying these variables can help you enhance your project.
  • Use pre-existing models and data: Consider leveraging already existing models and datasets instead of starting from scratch to decrease the amount of annotation required. This can result in substantial cost reductions.
  • Select the right annotation types: Different labeling categories have different prices associated with them. Selecting the proper annotation for your project requirements might lead to an optimized budget.

Overall, reducing the spending for data annotation requires a combination of careful planning, effective communication, and a willingness to be flexible. By taking the time to define project requirements, identify potential risks, and select a suitable data labeling partner, organizations can reduce their labeling costs while still achieving top-notch results.

We hope that implementing the abovementioned suggestions, will help you achieve superior outcomes in your data annotation tasks!

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Maximize Your Resources: How Outsourcing Data Labeling Can Save You Money 

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In 2022, outsourcing data labeling solutions and services accounted for more than 80% of total revenue in the field. Meanwhile, image/video-based data annotation increased at a 20% CAGR. This happened mostly because businesses continue to seek ways to optimize their operations and stay competitive in the ever-evolving landscape of AI.

Outsourcing data labeling can bring many benefits to organizations, including:

  1. Cost savings: Employing a data labeling team can save organizations a significant amount of money compared to building an in-house team. The precise cost reduction will rely on a number of variables, including outsourcing rates, annotation needs, the complexity of the data, and quality standards.
  2. Expertise and scalability: External annotation service allows organizations to access a pool of experienced and trained data labeling professionals who can handle large volumes of data quickly and accurately. This way, organizations scale their operations faster and more efficiently.
  3. Quality and precision: A expert data annotation company can help ensure the validity of the labeled data. Many annotation services have rigorous quality control processes in place to make sure that the labeled data meets the required standards.
  4. Focus on core competencies: Delegating the annotation of your data saves extra time to focus on their core competencies while leaving the data labeling tasks to the experts. This can help improve overall productivity.

Outsourcing your data labeling needs to a specialized provider can offer significant advantages over in-house data annotation. By partnering with a reputable company, like Label Your Data, you can tap into a team of experienced labeling professionals who can handle large volumes of data securely and accurately, saving you both time and money.

By working with a reputable and reliable provider, you can be confident that your datasets will be accurately labeled, allowing you to focus on other important aspects of your business. Moreover, hiring a professional data labeling service provider can help you to reduce costs by eliminating the need for expensive hardware and software, as well as the necessity to hire, train, and manage a dedicated labeling team in-house.


Data labeling is a must for organizations to achieve their AI project goals, but of course, it can place a substantial strain on your internal workforce, company operations, and finances. Working with data labeling services is one of the most cost-effective ways for organizations to get their datasets annotated while maintaining precision. In this case, companies can focus on their core business activities while still achieving high-quality labeled data.

Building an efficient budget for your AI-based projects may be a difficult task that requires thoughtful preparation, much like many other aspects of the data annotation itself. You may go through some trial and error, as well as unsuccessful attempts along the road. But by implementing the tips mentioned in this article, you can reach your data labeling goals, while staying within your budget.

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Abdul Aziz Mondol is a professional blogger who is having a colossal interest in writing blogs and other jones of calligraphies. In terms of his professional commitments, he loves to share content related to business, finance, technology, and the gaming niche.

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