The Marketing Consortium

Introducing our May Blogger: Andrew Hally

Well, it's been an interesting discussion this month about Interent Marketing.  It some ways it feels like we've just started, but alas our time is up.  Beginning May 1 our smiling faces will be replaced by Andrew Hally, Unica's VP of Segment Management, who will take the discussion in a new and interesting direction.

Throughout the month of May Andrew will attempt to address many of marketing's eternal challenges.  Customer-centricity, one-to-one marketing, and closed-loop customer interactions are just a few of the topics he'll adress.  We look forward to his thoughts and will continue as active commenters and bloggers in future months.

-Rand and Steve

The Myth of Real Time

Byline: Rand Schulman.  In the online marketing world, everyone is always asking me about real-time data, insisting they need real time.  I say it’s a myth.

“Real time” is one of those things vendors and users have always been confused about. Users of web analytics tools have asked for “real-time performance” while, at the same time, not really understanding why. Vendors, ever eager to one up their competition, are willing accomplices in this little charade.

This has manifested itself in a range of real-time functionality, like “real-time alerts,” which offer a minimum level of value. Emergency, red lights flashing, conversion rate dipping below threshold:  beeper goes off!  Yeah, and now what do you do?

True, there are some metrics which you could collect and display that will indicate general site conditions, but beyond that, real time alerts are of minimal value.  Yet we hear the request all the time from users for real-time features in our products.

So, what IS real time and HOW MUCH of it do you need to get your job done? 

Let’s define our terms. Real time is defined over two dimensions: collection and display. Vendors have applied this definition to mean anything, believe it our not, from four hours, to session-based results of milliseconds to 30 minutes. Early on there was a notion that all the behavior we collected about a person, and their purchase data, could be utilized to create offers that would yield higher conversion rates (as measured by sales or leads).  That promise didn’t materialize for many reasons, including inadequate databases, slow bandwidth and lack of raw processing power. Firms that held great promise like NetPerceptions, Personify and Engage largely went by the wayside due to unfulfilled user expectations.

What are some of the big issues facing us with regards to real time… and, are they moving us forward?  First of all, there’s the issue of data collection versus data reporting:  how much you can collect and report on in real time? Many, if not most, systems today collect page view data in real time, but now we are heading toward event-based collection. But capturing every event is just as irrelevant as capturing every cursor move. It becomes more problematic if one does not fully appreciate the orthogonality of these RIAs, Ajax, flash and streaming media events as compared to relative ease in understanding and optimizing page view-based events. One simply can’t collect and display the data in real time with any level of relevance.

Then there is the issue of endless querying and cubing of the data. How much data needs to be sliced and how quickly does one need to take action on it? Many vendors charge exorbitantly for this capability, when the requirement does not, in fact, exist.  You simply can’t make this truly actionable in real time. Emergency!  Change the content!

Here’s a little vendor secret.  Vendors play this game because users have not been explicit about their needs. We say to ourselves, “Users are asking for real time, but what they REALLY mean is real “enough” time.”

So what have we learned?  I hope we have learned to ask up front, “What do you want to do with this data?” and “HOW will you take action with it? Is it manual or automatic? What other systems of record are involved? How will I measure the uplift and results?”

The collection and display of real time data is very important in some call center applications where the offer can be targeted to the caller during the call. There are other uses of real time data, based on aggregated information and displayed as “the wisdom of the crowds.”  Product search results are a good example. Beyond that, there are few examples of real-time personalized data that are practical for increasing and optimizing conversion events -- unless you’re okay with four hours as “real time” or confine results to the changing of only two or three objects, frames, or blocks of content. I’d like to hear your real time feedback.

Leveraging Web 2.0 for Marketers

Byline: Steve.  So, to really leverage this Web 2.0 fad (no more debating about whether it's a fad or not, the term will fade away over time, like "multimedia" and that question becomes irrelevant) marketers can employ several tactics, including social networks, user-generated content, and rich Internet applications (RIAs).  Everyone is already trying to use RIAs where they make sense, and the challenge there is simply measuring the impact, because RIAs require a more significant development investment than static Web pages.  Ok, I'll say it --> It's important to understand the ROI of RIAs. It may no longer be sufficient to simply measure page-views to understand Web site utilization.  No, page views aren't dead, they're just becoming a little long in the tooth is all.

More interesting is the use, by marketers, of social networks and user-generated content.  Take this blog for example.  This blog is an effort on the part of Unica to reach out to our customers and prospective customers and the other people who influence our industry.  We know that if we put our opinions out there we open oursleves to criticism and commentary from competitors and detractors.  We know that by enabling public comments that we are opening oursleves to negative feedback.  And yet this blog is really an opportunity for us to show that we have smart people, with strong opinions, who are building the products that will power our customers' marketing success.  This blog is a social media outlet, and it will get better over the next several months as we invite more participation from inside and outside of Unica.

A blog is a pretty simple thing to set up, by the way.  This one is generated using TypePad, a hosted service from SixApart.  Other easy-to-use and free solutions for professional blogging include Blogger, from Google, and of course WordPress.

But some marketers can choose to be even more aggressive in their use of Web 2.0 and deploy a full-blown social network.  These tactics probably work best when the target audience is consumer oriented, as opposed to business professionals.  But we're still just at the beginning and who knows what new applications we'll find for social media and user-generated content. 

Many media sites use technology from companies like Pluck to deploy social networking functionality to large audiences.  Check out the variety of social networking functionality promoting the "American Idol" television show available at MyIdol.com.  This is a great example of marketing via community, or social, involvement.  Not that "American Idol" needs a lot of extra promotion, but this site is a great way to foster and encourage the natural buzz that accompanies such event TV.  There are many companies providing technology platforms that allow almost out-of-the-box social networking functionality, like Sparta Social Networks, Five Across, owned by Cisco, and Crowd Factory.  Or my previous employer, KickApps.

If you're going to venture into this world, it's important to find a partner like those I've listed above because they really understand the ins and outs of this Web 2.0 stuff.  There are lots of issues to consider, like content ownership and licensing, usability, privacy, and COPPA compliance (if you don't know what COPPA is, that just shows you how much there is to consider, because it's really important in this space).  A recent study by the Economist Intelligence Unit found that while the majority of executives (79%) saw opportunity in Web 2.0 technologies, they also acknowledged a lack of resources and understanding that would enable them to take advantage of it.

The net several posts will dive deeper into the really important pieces of Web 2.0 and Internet Marketing in general, that is the measurment of its effectiveness.    

Web 2.0 - A Boon for Marketers!

Byline: Steve.  In my last post I discussed the network effects of Web 2.0 applications and how they present a challenge for marketers.  Marketers demand control.  Marketers need to control the message that is communicated to the market and the medium by which it is communicated.  But with Web 2.0 applications like blogs, online reviews, ratings, and voting, marketers relinquish control of their message to customers (and prospective customers).  That is, the market.

The fancy term for online content created by end users is user-generated content (or UGC).  Well, maybe that's not so fancy, but only really cool Web 2.0-types use acronyms like UGC, so now you're one of them.  Next you'll be adding TechCruch to your RSS reader.

Anyway, the scary thing about UGC for marketers is the very thing that makes Web 2.0 such an opportunity for marketers.  That is, it's no longer just up to you to get the word out about your great product or service.  There are thousands of people willing to help.  Of course if your product or service is good ("good" = competitive, unique, high-value, or anything else you want it to mean), then this is great news.  If your product isn't good ("not good" = substandard, a rip-off, poor quality) then this is bad news and you should refer to my previous post.

So not only are thousands of people willing to help you get the word out, but they're mostly willing to do it for free.  And not only that, but they're also willing to give you free feedback about your offering so that you can make it better.  Wow!  Web 2.0 really is a boon for marketers!

Getting feedback from the market, measuring online success, and measuring the impact of marketing efforts will be a topic for a future post, so hold that thought for a while.

Tapping into the powerful network effects of Web 2.0 is not easy, but the rewards are definitely worth the effort.  Marketers can regain some of the control they've ceded simply by monitoring the messages being communicated.  This can be as simple as checking for any mention of your company name on the various blogs and message boards related to your products and services.  A simple keyword search on Technorati or Google Blogsearch can scour all the blogs ever written in seconds.  Upon finding a mention of your product or company, verify that the information is accurate and consistent with your desired message.  If not, be sure to use the appropriate avenue to correct any misinformation.  By "appropriate" I mean a measured response from a knowledgable individual on the same forum via comment or new post.  It should be in keeping with the spirit of user-generated content.  A flaming letter from your corporate counsel threatening to sue, sent to the blogger's mother, is not appropriate.  And it will backfire.

Aside from simply monitoring what others are saying you can attempt to communicate your desired messages by injecting a little Web 2.0 into the marketing mix.  The first thing you usually hear when people talk about "Web 2.0 marketing" is how they'll get thier message to go viral.  "Viral" refers to the phenomenon of people finding something great/useful/interesting and then communicating it online to 10 friends (usually via e-mail), who each tell 10 friends, and so on.  Virality is the holy grail of marketing. Everyone would love for their product to benefit from a viral campaign.  Unfortunately, virality is hard to predict and even harder to to influence.  Some marketing consultants and ad agencies claim to specialize in viral marketing.  I have never seen one actually deliver results.  I've yet to see a truly successful "viral marketing campaign," though I've seen a lot of proposals for them.  Catching a viral buzz is like catching lightning in a bottle.  It's neither predictable nor repeatable.  Just ask Antonella Barba.

So how can marketers leverage the power of Web 2.0 without wasting time and money trying to force something to go viral?  Sounds like a good topic for a future post...

Web 2.0: The Bane of Marketers Everywhere

Byline: Steve. In my last post I discussed the definition of Web 2.0 and the fact that it encompasses many things. RIAs, social networking, and user-generated content all have a home in the Web 2.0 world. Let's stick with the strictest definition for a moment and examine the impact on marketers and marketing.

Web 2.0 applications are those that leverage powerful network effects. That is, those things that get better the more people use them. Think of a social network with only a few members - limited usefulness, right? How about MySpace with over 100 million members? Some would argue that's too big to be useful, but in fact it's so big that micro-communities within MySpace have sprouted up along different demographic lines. If YouTube had a couple of funny videos it would be mildly interesting, but with over 100,000 new videos added every day it's become THE source for online video. For now, anyway. And so it goes with all Web 2.0 applications. This blog is only effective if people read it, link to it, comment, or forward it to their friends.

But if end users are generating content, what does marketing do? Well, they worry. User-generated content can be as simple as the "rate this movie" button on NetFlix or the "write a review" box on Amazon.com. Or it can be as complex as those idiots with the Mentos and Diet Coke. The point is, if the users are generating comments, reviews, ratings, and stunts, then marketers are no longer in control of the message. Marketers are at the mercy of the market. The world is turned upside down.

Marketers, and I am one, are very protective of their brand and their product. They spend all day crafting just the right messages to position their offerings just so. They agonize over individual words in the tag line, or the colors in the logo. Then some moron comes along and writes something bad about their offering in a blog review and all that work seems wasted. Thus, the title of this post, Web 2.0 is the bane of marketers.

Do you think the folks at Mentos or Coca-Cola were thrilled to see their products being used in such an inappropriate manner? Their brands hijacked to make a funny video? Turns out, the guys at Mentos were thrilled, while the Coke people found it less amusing. That is, until they were able to tap into the viral popularity of the phenomenon with their own site called "The Coke Show."

A ha. So there's hope. Marketers can actually leverage the power of Web 2.0 to further their brand, enhance their reputation, and build awareness. Maybe Web 2.0 isn't the bane of marketers after all...

Web 2. oh!

Byline: Steve.  So the topic for this month's blog is "The Internet Marketing Revolution" and I think Rand has provided an excellent foundation to kick off the discussion (was that ok, boss?).  So let's dive right into the current issues.  Almost everyone I talk to about Internet marketing these days is focused on one of two topics: Search Engine Marketing or Web 2.0.  Search engine marketing seems to be well understood and even though it's still the early days it feels like a very mature market already.  Web 2.0?  Not so much.

Rand is in NYC at the Search Engine Strategies Conference, so hopefully he'll post from there with some insight into what's new in that world.  I wanted to take a moment to address Web 2.0.

You know a market is still immature when every speaker begins her presentation with a definition of what Web 2.0 really is.  And no matter how many presentations and seminars we attend where speakers attempt to define it, there is still great confusion and/or disagreement as to the true meaning of Web 2.0.  I've had discussions with marketers who insist that there is no such thing as Web 2.0 - it's just a term invented by vendors to create hype and drive the demand for more products and services.  I've sat through presentations from vendors who insist that Web 2.0 is defined by the use of AJAX and FLEX and other RIAs (Rich Internet Applications).   For a whole generation of users, Web 2.0 means social neworking and user-generated content, like MySpace and Facebook and YouTube (and this blog!).  They can't all be wrong.  But can they all be right?

Yes.  They're all correct.  Without resorting to the mundane wikipedia defintion of Web 2.0,  I think it would be hard to argue that there's not a lot of hype surrounding the issue.  I mean, the term was invented by a bunch of marketers trying to drive attendance at a conference in San Francisco.  What could be more hypish than that?  But I think Paul Graham got it right when he writes of the term "Originally, yes, it was meaningless. Now it seems to have acquired a meaning."

The point of this definition exercise isn't to say that Web 2.0 can mean whatever you want it to mean.  Quite the contrary.  The point is to say that Web 2.0 is a very broad term that applies to lots of different things.  But they are specific different things.  Social networking?  Yes.  User-generated content?  Yes.  Rich Internet Applications?  Yes, sure.  But don't let vendors (or analysts, or consultants) hijack the term to hype whatever new tech trend they're trying to foist upon their customers (or clients).

So what does Web 2.0 mean for marketers?  Sounds like the topic of a future post...

And That Brings Us To Today

Over the last five years products in the online marketing space, especially Web analytics products, have gotten a whole lot better and the users are becoming much more knowledgeable. Today marketing users are demanding whole solutions and ease of use.  However, paradoxically, most organizations are using only a fraction of the impressive capabilities these products offer. True, the products collect ALL the data, and have all the answers. The users, it seems, just don’t have all the questions! I rarely speak with an organization that uses more than 10% of the product capability. I have spoken to thousands in the decade.  Most of them seem content using a fraction of the potential. Yet, some vendors just keep heaping on capability.

While we are all making moderated headway, there is the siren song of more power now and a rush to the seduction of more graphics, dimensions and  more data segmentable in real time. Some users fall prey. Pretty pictures rendered on expensive closed systems that offer dramatic “fly over” capabilities are very valuable for a few high end analysts, and are very well suited as BI (business intelligence) tools, but not for the majority of marketing people. Just as we crossed the chasm and made the marketing beachhead, it seems few vendors are selling to the marketing user any more. The vendors have coined new terms, and the old web analytics firms now ply the trade of customer intelligence, and business optimization, instead of plain marketing management. Many vendors seem to be losing sight of the buyer. One of the reasons I came to Unica is that we know our center, who we sell to, and why, and the mission hasn’t changed much since its founding over a decade ago. And that has impressed me.

Cool as it seems, most marketing people need action, not animated renderings of data with endless drill down reports. We need to run campaigns, online and off-line. We need to segment lists for direct mail and for email and then print and manage those lists. We need to correlate site visitor behavior with leads and optimize campaigns both for online and off-line conversations and back again. We need to test and repeat.  We need to manage and plan our work, and it needs to integrated with other enterprise systems, and easy to use. We need drag and drop interfaces, a range of deployment solutions from On Demand to on premises, and corresponding professional services. But mostly we need action, and for that we need to get the data in and out of the systems so that those other applications can make it happen. And we need to do it without IT involvement whenever possible.

Indeed, the rate of change is staggering. How are either vendors or users able to keep pace?  During this month-long blog I will attempt to put my decade of living in this changing environment into some perspective. I will explore topics like the evolving role of a “marketing person” (hint, there’s no such thing as a marketing person).  I hope to provide color and comment on this “vendor morphing” that I mentioned above, and on some of the general challenges that we’re all facing including a discussion of topics like, what IS Customer Intelligence? Is “Cross Channel” the same as multi channel? And my personal favorite, the Real Time Myth.  We will touch on the latest and greatest news, with a piece I’m calling, "Will the real Web 2.0 application please stand up?" Or, have you ever thought about "event-based tracking" and the question that I hear too often, "is the page view dead?"

Change is the only constant. Some thrive on solving these challenges and I consider myself one of them. Thus, we’ll also examine my main theme, analytics and action and I’ll offer some perspective on the future of our sector (note my new home for clues).  Since I have a “day job” I’ll try to post at least once a week so check back.  Between my postings my colleague, another experienced Web analytics vet, Steve O’Brien, will provide his color commentary. We’d like to have your feedback.

A Little Perspective on Web Analytics and Online Marketing

I ask you to indulge my regression and let’s revisit the sector about a decade ago. The internet was booming and it was all the rage to attract “eyeballs” to your site. All one had to do was have buzz, sock puppets, and funny names.  Like new math, new marketing was the thing to do. Making money, well, it was all about that eyeball land grab. They figured out that the one with the most balls, won. We know that didn’t work, and eye banks are the only ones who need more eye balls!

We had lost our way.  We needed to monetize our efforts and show ROI. The earliest firms to recognize this, NetGenesis and Accrue, made some great efforts, but there was a missing ingredient: demand. The earliest systems were used by forward leaning retailers, some merchandisers, and direct marketers who understood “conversions” and the concept of utilizing empirical data to make decisions. But those demand agents were few and there weren’t enough early adopters to drive vendors to success. Some might argue that their untimely demise was based on how difficult the software was to use and cost. Others might argue that the demand side of the equation was not there. The truth is that both were correct.

Marketers were more concerned with brand, color, and font than conversion based on ROI. And few marketers then knew what to do with the emerging internet as an effective marketing channel. Business schools didn’t teach internet marketing at the time (and rarely do today) and most didn’t ‘get’ that the internet is inherently a direct marketing vehicle with brand promise as a secondary offering.

They only people who did buy these early systems were in IT.  They were interested in the technographic information about browser types, OS use and 404 errors. They were they only ones who could install the software, but they really weren’t interested in behavioral information and web site optimization outside of making sure that the pages rendered. In fact for most of them, the marketing data got in the way of doing their real job, keeping the systems and networks up and running.

During 1997 presentations I often asked the audience how many of them would consider themselves either a marketing person, broadly defined, or an IT person. Back then only about 2 or 3 out of a hundred considered themselves non IT. The last presentation where I bothered to ask the question, the numbers had flipped.

So, what had happened?  The first; ASPs allowed IT to get out of the loop and we saw a spike in the marketing adoption rate. But mainly, the dot com bomb forced clarity and sobriety. We needed to show ROI.   And the industry learned a remarkable lesson: there is a strong similarity between both on line and off line marketing "objectives."  So instead of hearing from a customer that they have “an information site” with un-clear monetization objectives, they began identifying site objectives around principal types: Media, Commerce, Lead Generation, and Self Service.   Like an off line business, each of these models has a clearly defined objective of making more money (selling), saving more money (streamline process), creating more “stickiness” (the media model) and creating greater customer loyalty and retention. That’s it. It’s not eyes balls. Slowly an industry was born, with new organizations, and colleges offering internet marketing courses as part of MBA programs.

That's enough history, I'll pick up here tomorrow and talk about the current state of the industry and the shared challenges we face.

From Where I Sit, by Rand

I write to you from Boston, my new home base. I come here with my bike, and as Chris and Steve have noted, to spearhead Unica’s internet and cross channel push for a complete solution for enterprise marketing management. Someday I’d like to ride with Chris – a fellow bicyclist - on Marin County’s Mt.Tam in my home state of California!

Over the next few weeks I’ll be sharing some of my personal observations with you – about business and, maybe, about biking. I hope you find these notes interesting and perhaps even insightful.

The more things change, the more they stay the same. During the last decade I’ve been an executive with four “web analytics” vendors (incl. Keylime, WebTrends, and WebSideStory) and helped build the Web Analytics Association.  A month ago I joined Unica as GM of the Internet Marketing Solutions Group.

To kick things off I want to address the recently recurring question that I’ve been asked, “Aren’t you tired of the ‘web analytics’ market and want to do something else?”

To that my answer is an emphatic NO! Allow me to tell you why.

Web analytics has become the foundation layer of the “marketing stack.” It works in concert with other applications, such as behavioral targeting, email and campaign management, content management, search, and bid management tools, to give marketers the analysis they need to enable, what I call, “actionability.” Through it, marketers can set effective business rules that trigger actions in other marketing applications.

“Actionability” is just one of the major “changes” afoot on both the user and vendor side. Looking at how the business has changed may help us better understand this.

 

There are few stand-alone web analytics vendors any more and the ones still around have free products, which may or may not give users what they need to support their demands for ROI from their investments. I’ll shed more light on this in my next post. I welcome your comments on “actionability” in the meantime.

April Focus: Internet Marketing

No, it's not an April Fools joke.  Rand Schulman and Steve O'Brien will share the April spotlight here at the Marketing Consortium.  Our focus for April will be "Internet Marketing" and we expect a lively discussion about how online marketing efforts are integrating with traditional off-line marketing to form what might be called "Cross-Channel Marketing."

Special thanks to Chris Kenton for his insightful commentary on Social Media over the past two months here at the Marketing Consortium.

Both Rand and Steve have a long history in the online marketing world, with a specific focus on web analytics.  Our bios are available over there on the left, below the pictures (Steve is the good-looking guy).  But it's worth mentioning here that Rand was the founder and CEO of Keylime Software, one of the first SaaS offerings in the analytics space, later acquired by Overture/Yahoo.  He also served as Chief Marketing Officer of WebTends and most recently WebSideStory.  Steve has been in the busines intelligence space since 1995 when he directed product marketing for Red Brick Systems, the original data warehouse company.  More recently Steve built the sales and marketing team at Fireclick, one of the most innovative pioneers in web analytics, recently acquired by Digital River. 

We're both employed by Unica Corporation, but since we're both relatively new here we have no corporate sponsor axe to grind.  Most of our relevant exprience occured before we'd ever heard of Unica and that's the perspective we hope to share throughout the month of April.