Although almost every company in the world recognizes the power of data, most struggle to unlock its full potential. Companies such as Google, Amazon, and Uber that primarily deal with data are among the most valuable in the world, in terms of market capitalization, business performance, and innovation. One of the key reasons for their success is managing data like a product.

So, what is a data product? A data product is the application of data and analytics for improving business performance including monetization. Generally, when a firm develops a monetizable product, whether it's digital or non-digital, the goal is to create something that meets the needs of a wide and diverse range of users. A data product strikes a balance between a core/base product with universal appeal while ensuring it can be customized for specific use cases.

Data products like Google Analytics, Netflix's Recommendation Engine, Spotify Discover Weekly, Salesforce Einstein, NielsenIQ, and ZoomInfo are considered true data products, while databases (like Oracle, PostgreSQL, Snowflake, and Talend) and CRM/ERP systems (like SAP S4 HANA, Workday, and HubSpot) are not? So, how is a data product different from databases or data-centric applications like the ERP or the CRM system? Here are the six key characteristics of an ideal data product:

How are these data products created and managed? Here are the key principles of data product management for a forward-looking approach to product management.

While a data product is an innovative way of enhancing business productivity, the true power of a data product lies in its ability to leverage data for improved business performance. As businesses increasingly rely on data to maintain competitive advantage, defining the scope and adopting the principles or best practices of data product management will be essential to unlocking the full potential of data. The key principles of data product management discussed here can help data product managers and businesses to not only unlock new revenue streams, but also help reduce costs, mitigate risks, and stay competitive in today's VUCA (volatility, uncertainty, complexity, and ambiguity) business environment.