Before we talk about how database business works, I am assuming that you are looking at this in respect of starting the business or working as a sales person in it. So let me answer the questions one by one for your queries.
If you are working as a sales person or the lead generator in database company, then it's better to keep continuing the work, till you understand the in and out of any business. Hence, with that understanding you can start on your own.
Database business works in many ways.
1. Content Collection: People who gather the database of customer, they can run various email and other media campaigns. And this way they can target content or ads to the specific set of the customer profiles. This can be done both online and offline. So this content campaigning works good for most of the online companies. Your business can collect such data and you can make other business pay some specific sum to get the collected data for their customer profiles.
2. Mail marketing : Database collected can be used to run specific mail marketing campaigns. A lot of targeted mails can end up helping convert into sales. So mail marketing is definitely one more option for the business who are looking for exposure. Also many business spread coupons and discounts through this method.
3. SMS marketing : This is another option to use when it comes to using the collected database. Many business these days looking for phone number to promote their content. Due to DND service, there is a loss in number of mobiles that can be targeted. But with those numbers who are not part of the DND you can target them too.
Getting into Database Business
1. You have few ways to get into database business. Here you have to promote some offer in order to collect user phone and mail address. For example, some people offer form to the people who go into malls. And they offer the user trip to some place. And this way they can collect the users information.
2. This collected data needs to be filtered based on gender, age, salary and demographic. By doing that you can adjust your database and filter according to sales requirement.
3. This filtered data is likely to be helpful if you wish to sale the database to specific business who are looking for targeted customer profile. You can also use this to promote your own specific offers to their mail.
4. In such case you need to have a good CRM, custom designed database for collecting and filtering the database for information collected. Make sure to take backup of this information. As with growth of this information, you may face some crashes and corruption of data.
Pros of Database Business
If you have automated the process of collecting user information, then it can become one of the business that doesn't require much capital to survive. And it can also turn out to be more effective for those who have regular customers for such data. If done legally this type of business can turn out more profitable and chances of expansion into data mining and higher government and enterprise level project. There is a lot of financial potential in this type of business if executed the right way.
Cons of Database business
This business has a lot of borderline illegal stuff in it. For example using the personal information of people without consent and then using them for making sales is borderline illegal in many countries. In India, the laws are yet to be strict on that ground. But scraping email address and collecting personal user information and selling to other business can be illegal in some countries. Another point is that, often people ignore the mass mailing and SMS as spam. So that's one thing to consider if you are planning to get into this business of data collection.
Based on the current trend for the database business, you should instead consider turning this business into data mining and sentiment analysis projects. There is more opportunity in these fields but they require a lot of money too. So in between, selling database and supporting the leads collected and offering related service can be a better option.
