My colleague Matt Kinsman recently asked Alanna Young, president of Technomic, a provider of primary and secondary market information and advisory services to the food industry—and a division of Connectiv member Winsight—what's different between running a data business and a media business? She had been Winsight's chief operating officer and is a veteran of Hanley Wood's Metrostudy data business
"All content is not the same," she continued. "How the content is produced and packaged is not the same. The media audience is coming for news, journalism and insights. People who come for data are looking for more context, translation, instruction and actionable insight. The type of people who run content for media and those who run content for data are different and they have different skillsets. For data, you have to be skilled in research methodology and analytics.
"One of lessons we learned early on is, we thought we could just merge Technomic with media from a content perspective. No. It's not the same—the content is not the same, audiences are not the same, the formatting of information is not the same, but they can be cousins. They can share information back and forth. Data is a great business for media because you can't beat the content you get from it and the additional intelligence you get from the audience."
Technomic has an online platform called Ignite where the data is syndicated and that includes many of their subscription products. The other part of the business is a smaller, custom consulting business called Advisory.
There are several products within Ignite, Young said.
1. Ignite Company offers profiles of restaurant operators that include contact information, revenue and sales data. That shows what type of business they are. This serves anyone interested in selling to those operators or trying to understand the marketplace.
2. Ignite Consumer offers insight on what consumers think about various restaurant operations. If you have a fast food chain, we survey a consumer panel that provides a look into what they think about your chain, which can include data points such as cleanliness and perceived value.
3. Ignite Menu is their most data-heavy product—they collect thousands of menus and identify things like ingredients and emerging flavors. With something like Siracha, they were able to predict the rise in its popularity before it became mainstream.
"If you are trying to sell into an operator, you would want to come armed with information about who they are and how your products and services can help them," Young said. "On the flip side, if you are an operator, you want to know who your customers are, what they are thinking and where else they shop."
The business model for Ignite depends on who they are selling it to. "A traditional manufacturer might have interest in all three main components—Company, Consumer and Menu," Young said. "It can be sold in components—some buy all of it, some buy parts of it. It's a corporate license and we don't charge by the seat.
"The subscription comes with an account management team that offers a variety of support. Some customers have in-house analytics teams who can extract the data they want from Ignite and they are off to the races with just a subscription. Other customers are looking for more support, so we have an accounts team that offer a variety of services up to a very sophisticated custom market sizing study through our Advisory group. It depends on the complexity of what the customer is trying to figure out."
Products range from a la carte reports that start at $5,000 and can scale to more than $20,000. Compilations of services can run in the six figures. You can also buy profiles of the top 500 restaurants or the top 1,500 restaurants and the price will scale accordingly.
Thanks again to Matt Kinsman for conducting this interview.
"When you start thinking about a data business, you can't think of it as a content machine to power your media business," Young said. "It's its own business and it requires the type of commitment you would have for any new business. To get value out of a data business, it has to be self-sustaining with its own revenue model. Then you have to figure out how to pull content out of it without cannibalizing the benefit of the data subscription. The model has to be such that you are making enough money on the data business that it can support itself with the byproduct that it helps generate better content for the media business.