What Does It Mean to Have A Data Product That Adds Value?

The sheer volume of data available to businesses can feel overwhelming. It's easy to feel swamped by numbers, charts, and endless spreadsheets. But let's be honest—collecting and storing data can feel like the easy part. The real power, and therefore the complexity, lies in turning that raw information into meaningful insights that help us make better decisions.

In this blog, we move beyond the buzzwords to explore what it truly means to use data products that bring tangible value. We’ll examine how the correct data tools can empower leaders, drive revenue growth, and provide a predictive view of future trends—essentially transforming heaps of data into strategic assets that drive growth.

What makes a data product truly valuable?

First off, what exactly is a data product? It's not just a fancy dashboard or a pile of numbers. Think of it as an artifact, approach, or platform that takes raw data and “facilitates an end goal through the use of data." These products blend industry expertise with real-time data, helping you make decisions that are both strategic and practical.

Now that we know what a data product is, what makes one valuable? Four key elements:

1. Accuracy: It provides reliable information you can trust.
2. Relevance: The insights are tailored to your specific business needs.
3. Timeliness: It delivers information right when you need it.
4. Usability: It fits smoothly into your existing processes without causing headaches.

To really grasp the idea and impact of data products, let's look at a company that used data to revolutionize its business.

How data products power smarter revenue generation

Remember when Netflix was just mailing out DVDs? They've come a long way, and a big part of their success is thanks to how they use data. By analyzing what we watch, how we rate shows, and even how long we browse, Netflix spots patterns in viewer preferences to provide better and better content recommendations. 

But they didn't stop at analyzing for better experiences. Netflix used data to create its own content. By noticing a strong interest in political dramas and high engagement with director David Fincher's work, they decided to produce House of Cards. This wasn't a lucky guess; it was a calculated move based on solid insights from their data analysis.

By leveraging data about their audience's preferences, Netflix made informed choices that led to increased engagement and growth. Their data product—the recommendation system—not only enhances user experience but also guides strategic decisions like content creation, leading to an engaged and lasting customer base.

How data products spot trends to justify investment

In fashion, staying ahead isn't just about new styles—it's also about embracing consumer trends. Patagonia is a prime example of a company using data to identify shifts in consumer trends and innovate with eco-friendly fabrics. By analyzing data on resource usage and environmental impact, Patagonia develops materials from recycled and sustainable sources, reducing their carbon footprint.

Their data products help track the entire lifecycle of their products, encouraging repairs and recycling to minimize waste. This approach aligns with consumer demand for sustainable practices and strengthens their brand reputation. By integrating data analytics, Patagonia adapts quickly to market trends, meeting environmental goals while satisfying customer expectations.

Making data products work for you

After seeing how companies transform data into success, you might wonder: how can you do the same in your business? Turning data into actionable insights doesn't have to be overwhelming. Here's how you can start using data products to your advantage:

1. Assess Where You Stand
   • Data Quality: Is your data accurate and relevant?
   • Infrastructure: Do your systems support new platforms, or do you need upgrades?
   • Skills: Do you have the right people, or should you invest in training or hiring?

2. Align with Your Goals
   • Set Clear Objectives: What do you want to achieve? What is not in scope?
   • Get Buy-in: Ensure leadership and key teams support and value the initiative.

3. Start Small and Grow
   • Pilot Projects: Test data products where they can make an immediate impact.
   • Measure Success: Use key performance indicators to see what's working.
   • Expand Wisely: Roll out successful strategies to other parts of your business.

4. Empower the Data Culture
   • Share Insights: Make data accessible across your organization.
   • Empower Your Team: Provide resources and training to equip your team better.
   • Keep Learning: Stay updated on new technologies and best practices.

Our world has grown beyond simply collecting information or sticking to traditional analytics. We need to shift our perspective and start viewing data products as valuable assets with specific goals that drive our businesses forward. By transforming raw data into purposeful tools, we're not just crunching numbers but creating strategic advantages. Organizations that embrace data products as integral assets are the ones leading the way, not just keeping pace.

Sure, it takes effort to shift an organization’s mindset and rethink traditional approaches, but why wait? By investing in these assets now, you're setting yourself up to tackle future challenges with better insights and certainty. 

Want to hear more from Katrina? Reach out to her via email or LinkedIn.