Ariba and Denali: Monetizing Supply Markets Intelligence in Different Ways

Watch out, Time Warner; there's a new media company on the block (which just happens to own a few choice online properties as well). If you're guessing this is a private equity publishing role-up, you'd be wrong. It's Ariba. That's right, Ariba. The other day I was trolling around Ariba's Supply Watch mini-site and found this link to an advertising slick for Supply Watch. Now, I doubt that the management team has forecasted much in the way of a P&L bump thanks to Supply Watch, but I find it fascinating -- and smart -- that Ariba would try to monetize its category and global supply market IP through a publishing-based business model. For those who have not read Supply Watch in the past, the quarterly glossy is anything but just another trade rag. It's an inside look through category trends and supply markets that virtually every practitioner involved in sourcing will find something useful in. Originally, the publication was intended only for FreeMarkets (and later Ariba) customers, but it appears that the current version is aimed at a mass audience (despite the fact there's been no dumbing down of the content).

But Ariba is not the only provider in town getting into the new media game. Denali Intelligence, an offshoot of Denali Consulting, is taking a different approach to monetizing its own supply markets experience and research. But this consulting and content provider is going about monetizing its IP in a different way -- by charging users a subscription model to access content. While different packages are available, Denali's research goes into much deeper depth than Ariba's (as it should, considering they're charging non-trivial sums for it). For example, Denali offers detailed market intelligence reports on specific categories which look at demand drivers, cost factors, supply base information, supply risk and best practices, among other areas. One of these detailed reports I've had the chance to look at is thirty-six pages in length and does a commendable job looking at the distribution transformer market. Denali tells me their market intelligence reports will be updated every six months.

With differing frequency, Denali Intelligence is also serving up weekly reports analyzing market news and highlighting recent events and trends, with a monthly opening price point report that captures pricing trends for 20 commodities, as well as analyst support -- essentially "ask the expert" access to Denali's market analysts who conduct the research. In addition, Denali Intelligence is also offering up, as they term it, "Business Unit reports" which will be "quarterly reports that spotlight key categories for specific business units. The reports are created by DI and then distributed internally by the client as a way to strengthen relationships with the business units."

Is the material that Denali Intelligence producing invaluable? Absolutely. Will it succeed commercially? Only time will tell, but having been a consultant who, thanks to this blog, is also a content provider, I can say that the two businesses are fundamentally different and making money in each requires a different mindset. Without question, Denali Intelligence will do well within Denali's own consulting base, but whether they gain significant traction in the broader market remains a question. Over the years, AT Kearney has tried to play in a similar business providing category specific content, but as far as I can tell, has not realized booming commercial success with it. Stay tuned in the coming months as Spend Matters takes a closer look at Denali Intelligence.

- Jason Busch

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