How To Create a Data-Focused Subscription Product
"Flipping" data, enhancing data, and data exhaust are just some of the opportunities to create revenue-producing data products from free resources.
One of the best things above government databases is that even when the government agency makes the database available on its website for free, it isn’t very useful. That’s because government agencies put these databases online for regulatory or compliance reasons. They’re designed to search for known entities because the expectation is that you are checking the license status of a company, or perhaps its compliance history.
Occasionally, a government agency will get ambitious and permit geographic searches, but in these cases, there are real limitations. That’s because the underlying data were collected for regulatory, not marketing purposes. So, for example, a manufacturer with 30 plants around the country may only appear in one ZIP code because the government agency wants filings only from headquarters locations.
Taking a regulatory database and changing it into, say, a marketing database, is something I call “flipping the file,” because while the underlying data remains the same, the way the database is accessed is different. Sometimes this is as simple as offering more search options; sometimes it involves normalizing or re-structuring the data to make it more useful and accessible.
As just one example, a company called Labworks built a product called the RIA Database. It started with an investment advisor database that the SEC maintains for regulatory purposes. Labworks then flipped the file, to make the same database useful to companies that wanted to market to investment advisors. There are hundreds of data publishers doing this in different markets, and as you might expect, it’s a very attractive model since the underlying data can be obtained for free.
In addition to simply flipping a file, you can also enhance a database. The shortcoming of many government databases is that they focus on companies, not people, so while there may be a wealth of information on the company, data buyers typically want to know the names of contacts at those companies. Companies such as D&B and ZoomInfo do a brisk business licensing their contact information to be appended onto government databases of company information.
This is one of the truly magical aspects of the data business. Databases built for one reason can often be re-purposed for an entirely different use. And re-purposing can involve something as little as a new user interface.
This magic isn’t limited to government data of course. Another great place to look for flipping opportunities is so-called “data exhaust,” data created in the course of some other activity, and thus not considered valuable by the entity creating it. You can even license data from other data providers and re-purpose it. There are a number of mapping products, for example, that take licensed company data and essentially create a new user interface by displaying data in a map context.
Increasingly, identifying the data need is as important as identifying the data source. With data, it’s all in how you look at it.
This article is adapted from the Infocommerce Group Blog