The technological advancement has brought us into an information age where data and information represent business asset as well as new source of revenues (Ref. 1). Information goods include a wide range of products such as content, games, media, advice, consulting, designs, data service, etc (Ref. 2). The rapid market growth of information goods is fueled by cost reduction and scale increase in very efficient product lifecycles that has never been seen previously. However, a major bottleneck in the information goods industry is ‘Market Failure’, that is a type of uncertainty faced by consumers who are not able to assess accurately and reliably the utility/value of these products before purchase (Ref. 3). This is a peculiar property of information goods whereby the process of evaluating utility may require the very process of consumption. To overcome the bottleneck, producers and especially publishers of information products should address the problem from two perspectives: business intelligence and brand management.
In the point of business intelligence, the quality of the information goods shall be strictly controlled. For example, if the information goods are data service, robust process should be adopted to ensure data quality and good visualization. High-quality data can only be collected by defining one or multiple reliable data sources, building fault tolerance into process, usage of knowledge experts, and verifying the results by manual sampling or check-points (Ref. 4).
In the point of brand management, improving brand reputation is a key to enhance the trust of information goods. Disney is a good example of efficient marketing its movies with a prestigious reputation of product quality and brand intimacy. As information goods is a type of experience products, publishers of information goods are always using ‘browsing strategy’ – allowing potential customers to access or pre-view part of content or data. For instance, publishers of market research reports always give out sample reports to potential buyers to illustrate the content, format, and quality of the research data/work (Ref. 5). It is also a good marketing tactic to publicize the feedbacks and testimonials from previous clients about the information goods they purchased.
In your opinion, what is the best strategy to address the ‘Market Failure’ problem for marketing information goods? Will a ‘money refund guaranteed’ model work in this industry?
Reference:
- Information as an economic good: the next information age stage. https://www.i-scoop.eu/information-as-an-economic-good-the-next-information-age-stage-in-four-steps/
- John Spacey. December 16, 2017. 9 Examples of an Information Good. https://simplicable.com/new/information-goods
- Information good. https://en.wikipedia.org/wiki/Information_good
- Lisa Morgan. Oct 14, 2015. 8 Ways To Ensure Data Quality. https://www.informationweek.com/big-data/big-data-analytics/8-ways-to-ensure-data-quality/d/d-id/1322239
- See an example of data publisher and its website at https://www.gracemarketdata.com/index.php/about-gmd
Leave a Reply