Without proper and timely business intelligence, businesses can not determine the effectiveness of an e-mail campaign. Bruce McCracken continues his series on targeted e-mail with a look at ASPs that offer analytics solutions which can help companies boost the results of future campaigns.
A sound permission based e-mail strategy is not only a wise business decision, but also an integral component of marketing and customer care. Actually, as we look forward, it is but one piece of the puzzle to bring the enterprise into the future through business technology. The future belongs to the swift, the agile, and the nimble that cannot only offer first-rate products and services, but can do so with deft precision at high speed.
Be certain of this, your target audience, be it B2B or B2C, knows their needs more than you do. They are also much more sophisticated as consumers with very high expectations and requirements. In competing for their business, what was once a very fine line has become a razor's edge.
What is required in business technology to meet these needs is the synergistic convergence of data and knowledge. All too often within segments and channels of the business, there exists dissonance. Much of this can be attributed to the left hand not knowing what the right is doing. Actually, disconnect often extends to none of the fingers being on the same page. A wise CEO may well instill a serious message via comic relief by echoing the famous line from the 1967 movie "Cool Hand Luke," "What we have here is a failure to communicate."
In the February 2003 report, "What WorksTM: Best Practices in Marketing Technologies," Kent Allen, research director, for Aberdeen Group of Boston writes, "During the last few years, a new range of marketing technology has emerged including point solutions for campaign management, e-mail marketing, customer analytics, collaboration, digital asset management, and workflow and project management. Although each of these tools shows demonstrable promise -- indeed, marketing applications are currently one of the fastest growing domains of enterprise software -- marketing point-tools' potential has been limited by their lack of integration: Optimizing one or two elements of the marketing engine falls short of the promise of empowering the entire marketing process."
Pain and Problems
David Daniels, senior analyst for Jupiter Research of New York addresses the need for organizations to become organized. "The lack of coordination within a marketing organization is a huge issue. We find that the majority of companies, for example, select lists and execute campaigns at the business unit level, with no guarantee that a different division or unit didn't use the same list previously." In the September 2002 report, "Relationship Marketing: Improving Campaign Revenues Through Behavioral Marketing Tactics," Jupiter Research concludes, "Marketers fail to move beyond simple segmentation tactics, may miss key behavioral data." The criteria and usage is detailed in the figure below from the survey that queried 710 respondents.
Types of Customer Data Marketers Use to Select Campaign Audiences
Question asked: In the past six months, which customer data attributes has your company used to segment and select audiences for marketing campaigns? (Select all that apply.)
Daniels adds that the ability to do deep analytics is a major problem. "Although many marketers state that inadequate data and insufficient staff hamper their management of campaigns, the real obstacle for most is a lack of technology, as only 19 percent of companies surveyed by Jupiter have an e-mail marketing analytics packages deployed capable of customer-level analysis." The same report details what the respondents felt were the biggest challenges (multiple selections permitted) to improved e-mail campaigns.
Biggest Challenges to Improving Results of Companies' E-mail Campaigns
Question asked: What has been the biggest challenge for improving the results of e-mail campigns to your company's house list? (Select all that apply.)
Daniels continues, "There is an effort in coordinating traffic management not only in data, segmentation and business intelligence but also in list selection and prioritizing which units get the data. Very large organizations are making moves to deal with that issue now to synchronize the marketing and operations. Organizing and centralizing the data is the easiest part, getting everybody on the same page is the harder part."
Charles Gold is vice president of marketing for business intelligence infrastructure company Appfluent Technologies, based in of Arlington, VA. "The pace of business is accelerating and in today's environment companies need to be agile. To be agile means to have access to fresh data."
The reporting needs of decision makers forces the IT infrastructure to attempt to serve two masters to the detriment of both according to Gold. "Increasingly, to get the timeliest information, companies are running reports from their production systems. It creates contention on database infrastructure that deteriorates performance of both the reporting and the production applications. As more and more people need data, more and more strain gets placed on that infrastructure."
In October 2002, Appfluent Technologies released a report, "A Study On Reporting and Business Intelligence Application Usage." The survey of 358 businesses of varying size focused on the adverse impact that business intelligence reporting had on the IT infrastructure. "The most frequent reporting problem that affects system performance is that reports are generated from the live production database putting a strain on the reporting tools as well as the production database. Only a small percentage (3-6%) indicated they never have performance problems when reporting on specific applications." The figures below detail the application categories and reported degree of performance issues and departments experiencing them the most.
Gold also reports that, "There is a major disconnect between what businesses require and what their IT departments are providing for them in terms of BI infrastructure. 85% of companies are not providing the BI infrastructure that their managers need."
With an Eye on the Future
Through integrated data merging and reporting capabilities, the enterprise will be able to strategically plan and keep an eye on the business with relatively fresh data that has been assimilated to produce a wider yet more detailed view. Conceptually, at the furthest point, the principle can be equated to the communications system at the United Nations that allows all of the delegations to hear the others in their native language.
The unification of business process technologies for strategic planning may appear to be a futuristic concept. But it is, in fact, happening, not only with larger enterprises, but also in the small to mid-sized businesses (SMBs). At the base of this emergence are the capabilities of Web-based offerings, largely through application service providers (ASPs) coupled largely with the use of eXtensible Markup Language (XML), Simple Object Access Protocol (SOAP) and Web Services Description Language (WSDL).
Similarly to Rogaine, which was not originally developed for treating hair loss, much of the demand for this has come from outside of the normal boundaries of business intelligence. Notably in sales force automation (SFA). Some feature robust customizable reporting capabilities that can be displayed on what is known as a dashboard. Clients expressed interest in extending this reporting capability to other aspects of their enterprise. The demand resulted into the reality.
Greg Gianforte is CEO of RightNow Technologies headquartered in Bozeman, Montana, a provider of hosted customer service and support solutions. "There really aren't any obstacles that prevent an ASP from integrating with other ASPs and/or a customers' internal applications. We've already done this for numerous customers."
Essentially, the ASPs can translate applications into other languages for mutual use. The process involves data mapping to do the translation. Once the ASP has done the data mapping for given applications for one client, the data mapping can be used for other clients using the same applications with only customization for unique codes being required.
Mike Doyle, CEO of Salesnet, headquartered in Boston, a Web-based SFA provider states, "Our Web Services Application Programming Interfaces (APIs) use open standards that enable customers to more easily integrate Salesnet with their existing call center, marketing automation, enterprise resource planning (ERP), legacy systems, and other enterprise applications."
Gold feels that business intelligence is extremely important and that businesses need to deliberate on how they choose to implement the integration. "The advantage is very clear in using an outsource provider. Their core competency is managing those systems. They don't need to worry about any of the infrastructure headaches. The trade off is that the systems may not be highly customized and not tailored around the business processes of the customer but rather what is convenient to the ASP to provide."
Outsourcing to the ASP leverages many additional advantages including performance accountability through a well-crafted service agreement and costs spread out over time with reduced up front cash outlays for licenses, infrastructure, and personnel. The risk is much less as the enterprise can walk away from the arrangement after the agreement lapses if the value proposition does not merit continuing. With a licensed model, there is the risk that the application will not meet the needs of the enterprise and expensive software becomes shelfware.
Gold continues, "It is a very easy decision to say that, for now we will outsource it and later on bring it in-house. The countervailing forces are that if something is working, don't fix it. The CIO must measure the risk/reward of taking it in-house. It comes down to the individual requirements."
Gianforte looks ahead to see that the key for ASPs will be in management of the integrated data as a growing customer base leverages economy of scale. "There are numerous examples today of companies that have successfully performed a variety of high-value integrations in very short order and with relatively simple programming. Successful application providers today have built their software from the ground up for multi-tenancy over the Internet. The question down the road will be how to manage large numbers of XML-based integrations as customers embrace the Web services model more and more."
Allen concludes, "Related solutions are helping marketing organizations successfully address three interrelated challenges -- strategic planning, collaboration, and resource management. The greatest potential returns are coming to the companies that are tying together customer analytics, campaign management, other CRM applications and all customer communication channels into a coordinated system for managing the entire customer lifecycle."
I See Said the Blind Man
Increasingly, ASPs are offering their clients services to map various applications, even legacy systems, to be able to pull out data in a common language to be integrated into reports for high level management for improved coordination between various departments often running different applications. This is not new for much of the Global 3000. But what is new is that the ASPs are doing this for their customers, many of which are SMBs or independent divisions of larger enterprises. ASPs are able to leverage economy of scale in doing this as the costs are spread out over many customers over time.
In a simple sales analogy, a CEO may want to measure the effect of a targeted e-mail campaign on a temporary price reduction on a particular new printer. Previously, the click stream could be tracked to give the direct response that led to orders on the migrated path to buying on line. But this does not reflect the total impact and latency of the campaign.
A customized report can now be generated to incorporate the sales that were made online independently of the e-mail click stream at another point in time that cross references the e-mail list for the name and address to match up with the purchasing name and shipping address. Further, in the traditional retail channel, the names and addresses could be measured in the warranty registration cards as well as the sales differential. The combined data could yield a much clearer picture of the campaign.
On the flip side, CRM/customer care, the same principle can be applied to measuring customer questions and inquiries from online support, e-mail, and all touch point levels at the call center to reveal a shortcoming in the way the new printer's owner's manual was written.
This information enables the key members of the management team to assimilate disparate information, theoretically through out the value and supply chain, to react and plan with greatly increased speed and agility. The idea is not to constantly merge all of the data but rather be able to assimilate data as needed for specific strategic and tracking purposes. No longer is the CEO forced to have business vision impaired by not being able to see the forest for the trees.
Bruce McCracken is a business writer with specialization in outsourcing. His coverage areas are primarily in IT, eCommerce, CRM, HR, and supply chain/distribution with focus on small to mid-sized companies. He may be e-mailed at firstname.lastname@example.org.