The alternative data industry is booming, yet a striking number of data vendors struggle to gain market traction. You can have a groundbreaking dataset and still fall short of commercial success. Why does this happen? In this thought-leadership piece, we’ll explore several common reasons alternative data providers fail to scale from marketing missteps to go-to-market blind spots and highlight what the most successful vendors do differently.

Common Reasons Alt Data Vendors Struggle

Despite growing demand for data-driven insights (75% of investment firms planned to increase alt data spending), many alternative data vendors remain stuck with only a handful of clients or stagnant revenue. Here are some frequent pitfalls that hinder vendors from gaining traction:

• Undefined Value Proposition: Too often, data providers fail to clearly answer the question “What value does this data deliver?” If potential customers can’t immediately grasp how your dataset will improve their investment decisions or operations, they’ll move on. Vendors sometimes describe what their data is (e.g. “geolocation pings from mobile devices”) but not why it matters (“helping retailers predict foot traffic trends”). A vague value proposition makes marketing and sales an uphill battle.

• Poor Targeting and Positioning: Another common mistake is not identifying a specific target market or use case. Some vendors pitch their data as a fit for “anyone who wants insights,” which dilutes the message. Successful data providers usually start with a well-defined niche, say, alternative data for credit risk analysis, and tailor their marketing to that audience. Without clear positioning, your outreach and content won’t resonate strongly with any one group.

• Lack of Marketing and Thought Leadership: “Build it and they will come” does not apply in alternative data. Many vendors invest most of their resources in data engineering but little in marketing. They have no regular content output, no case studies or whitepapers, and a minimal presence at industry events or forums. This leads to low awareness and potential data buyers simply don’t know the vendor exists or don’t perceive them as credible. In contrast, successful vendors often act as thought leaders: publishing research using their data, speaking on webinars or at conferences, and regularly engaging with the community. This visibility builds trust and keeps them on the radar of prospects.

• Ineffective Go-to-Market Strategy: Selling data is not like selling software, it often requires longer sales cycles, trial periods, and careful integration into the client’s workflows. Vendors that fail often lack a structured go-to-market plan. They might rely on one sales rep with a Rolodex of contacts, or passively list their dataset on a marketplace and wait. What’s missing is a proactive strategy: systematically identifying high-potential prospects, reaching out with tailored pitches, offering pilot programs or proofs of concept, and addressing stakeholder concerns (like compliance or IT integration) early. Without a thoughtful go-to-market approach, even good products get stuck in endless “maybe later” discussions.

What Successful Vendors Do Differently

On the flip side, what do the top-performing alternative data vendors get right? Here are strategies that set successful vendors apart, allowing them to build momentum where others stall:

• Nail a Specific Use Case and ROI: Winning vendors start by articulating a clear use case (or a few) for their data and the return on investment it offers. They don’t just sell “data”, they sell solutions or answers. For example, instead of pitching “social media data,” a successful vendor might market “real-time consumer sentiment scores that predict quarterly earnings surprises.” By demonstrating how the data is applied and quantifying its impact, they make the purchase decision much easier for the client. Bonus tip: Create and publish forward looking case studies!

• Focus on the Right Audience: Rather than trying to attract every possible buyer, leading providers know exactly who their ideal customer is. They deeply understand the workflows and pain points of their ideal users, and tailor both their product and messaging to that audience. They also make sure to be present on the industry platforms and networks where their target buyers are actively looking for data.

• Invest Heavily in Education and Content: Top vendors treat marketing as an essential part of their product. They produce high-quality content that educates the market about their data category and its benefits. This could include regular blog insights, detailed whitepapers, webinars with experts, or even proprietary research reports. Importantly, their content is data-driven and often showcasing insights drawn from their own dataset. This thought leadership generates inbound interest and can even shorten sales cycles, as prospects gain confidence in the data’s value.

• Build Credibility Through Partnerships and References: Successful data vendors rarely go it alone. They frequently partner with established platforms or institutions to boost their credibility and reach, for example, distributing through well-known data marketplaces or integrating with popular analytics tools. Such partnerships validate their offering in the eyes of skeptics. Additionally, top vendors collect testimonials and reference clients who will vouch for them, knowing a strong reference from a respected firm can overcome buyer hesitation.

• Continuously Refine the Go-to-Market Playbook: Finally, successful vendors treat their go-to-market as a continually improving process. They set up feedback loops between sales, marketing, and product teams to constantly refine their approach. They measure which tactics bring in leads and which messages resonate, then double down on what works. If one segment isn’t responding but another is, they adjust focus quickly. This kind of agility, guided by data and feedback, keeps them aligned with the market and ahead of the curve.

Thriving in the Alt Data Market

The alternative data space is both crowded and fast-evolving, with thousands of providers competing for the attention of data buyers​. Many will inevitably struggle or shut down (dozens of datasets are discontinued each year​.) but others will become the next success stories. The difference often comes down to execution in marketing and go-to-market strategy. By clearly communicating value, targeting the right audience, building credibility and trust, and committing to continuous improvement, an alternative data vendor can break through the noise and gain real traction.

If you’re an alt data provider looking to accelerate your go-to-market success, consider partnering with experts who know the terrain. At admac, we specialize in helping alternative data vendors craft winning marketing strategies. Book a free discovery call with admac to discuss how we can help you avoid the common pitfalls and accelerate your success in the alt data market.