Hubspot Offers Small Business Marketers a Big Bundle of Features

Summary: Hubspot offers a bundle of Web traffic generation and lead management features in one low-cost package. Small businesses willing to invest some effort should be pleased with the results.

Yesterday’s post described one strategy to sell marketing automation to small businesses: provide a specific, turnkey service that requires virtually no skill or effort from the user. But I don’t think that can scale: companies require many different services and will not want to buy and run each one separately. So I believe the future lies with integrated marketing automation systems that combine many different functions while sharing data and processes whenever possible.

Of course, these multi-function systems must still be suited to users with little time and expertise. Marketing automation vendors entering this market are essentially betting that they can make their systems powerful enough to be useful and easy enough for a small business to run. If the vendors fail, the business will go to consultants, ad agencies, and other service firms that do the clients’ marketing for them. That would greatly limit the marketing automation vendors' business.

Hubspot has accepted this challenge. Although Hubspot positions itself as an “inbound marketing system,” it actually does more than the search engine optimization, blogging, social media interactions and related analytics needed to generate Web traffic. The current version also hosts landing pages and Web sites, manages a lead database with profiles and Web activity history, generates lead scores, sends alerts to sales people, and synchronizes data with Salesforce.com.

All that’s missing to be full-blown demand generation system is outbound email and lead nurturing campaigns—which the company has announced it will add.

Implementations of these features are intentionally simple, since ease of use is more important than sophisticated options for small business marketers. But Hubspot also applies automation to improve results without making the user work harder. For example, the blogging system automatically connects the blog to social media sites that help to redistribute content. It also checks posts to ensure they are optimized for search engine rankings. Hubspot provides similar graders for the Web site and individual pages, each generating reports and recommendations for improvement.

(Free versions of these and other graders are available from Hubspot at Grader.com. Most seemed fairly useful when I played with them a bit, although the Web “personality grader” managed to be both inaccurate [“your Internet use primarily consists of emailing family pictures and checking your teenager’s Facebook”] and insulting [“engaging in more meaningful conversations and sharing less about your personal life may improve this grade”]. I'm not sure what to make of that, except to suspect that someone left the programmers unsupervised. [I've since been informed that Personality Grader was an April Fool's joke.])

The scope of Hubspot makes it somewhat difficult to assess. The system’s heart is clearly search engine optimization and the supporting features to generate content (blogs and Web sites), receive the resulting traffic (landing pages) and analyze the results. These components seem well designed, tightly integrated and, at least for the graders, innovative.

The one major missing inbound marketing feature is paid search management, such as Google AdWords integration. Hubspot Marketing VP Mike Volpe said that paid search can be tracked as a source, and that clients have not requested deeper integration – apparently because they’re already happy with the AdWords interface. But I still find this a curious gap, since it leaves the system blind to a major marketing expense. It's part of a general lack in Hubspot of the “campaign” orientation found in most marketing automation systems. Maybe small businesses don't think in campaign terms -- or maybe it's just that search engine optimization isn't organized that way.

Hubspot looks more like a conventional marketing system in its ability to manage a lead database. Leads can be captured on landing pages, imported from lists or added through Salesforce.com synchronization. The system can also create profiles of anonymous visitors, using their IP address to infer geographic location and company. The database can include answers to survey questions and fields imported from Salesforce.com. It also stores Web activity history, captured by the usual methods: tracking scripts on the Web pages (created automatically on Hubspot-built sites) and cookies on the visitor’s PC.

Hubspot originally used its lead database largely for analytics. But it added Salesforce.com integration in 2008, which also meant the leads and their activity history could be shared with sales people. It extended this in 2009 email alerts triggered when user-selected leads visit the Web site. It also now uses Salesforce.com opportunity records to measure the close rates of leads from different sources. Users can also flag the closed leads manually.

Closed leads are also used to build a ranking system that assigns each lead a value between 1 and 100 based on its likelihood to close. This is a good example of the Hubspot philosophy at work: the grading system is simple (just one score), simplistic (formulas can look at the number of page visits, but not particular pages) and fully automated (it develops a custom scoring formula for each client and adjusts it over time without any manual input). Volpe acknowledged it takes a long time to gather enough data to build a reliable formula. But he argued (and I agree) that few small business marketers could build a better formula on their own.

Once Hubspot adds outbound email and nurturing campaigns – which Volpe said should be “relatively soon” -- its lead management features will about match other small business demand generation systems. That’s good enough, though not as impressive as its search optimization capabilities. (Actually, most small business demand generation products also offer a lightweight CRM module for companies that don’t have a separate CRM system. But I consider that optional.)

Hubspot also includes some functions that extend beyond traditional demand generation. These draw from its roots in Web traffic analysis. One is an automated analysis of competitive Web sites, based on Website Grader. This shows traffic from major keywords plus several types of rankings. Other features include automated Web scans to identify changes in keyword rankings and relevant social media articles. The social media features also make it easy to comment on the articles and to measure the reach of the company’s own blogs, Twitter, Facebook and YouTube posts. Although none of these is itself a major innovation, they’re useful tools to assemble in one place.

So now that we’ve taken a look at some of the mechanics of Hubspot, let’s circle back to the original question: is Hubspot powerful enough and easy enough for small businesses marketers?

The system clearly succeeds on the power front: although most of its features are fairly basic, they should be more than adequate for most companies. Even though Hubspot is not quite a complete marketing solution (lacking the paid search management and integrated CRM), it does enough different things to replace many other systems.

I have more doubts about user effort. Hubspot isn't hard to use, but it does seem to require a lot of work from its users. In particular, the Web site and keyword reports all seem to issue alerts and recommendations that the user has to execute separately. Whether it’s adding new keywords to page metadata, changing a bid on a paid search ad, or rewriting copy to be more search engine friendly, Hubspot looks more like a demanding boss than a helpful assistant.

In a small business where people are already stretched to the limit, a system that adds rather than reducing work is not very appealing. Even knowing that the added work is valuable doesn't necessarily solve the problem: the time has to come from some other work that has value of its own.

But maybe that’s just me. Volpe said that users’ biggest problem is finding time to write new content, not making the other changes like tweaking page tags. This is because most of the system’s automated recommendations are specific enough that they’re pretty easy to execute.

Of course, the customers are the ultimate judges of success. Volpe said that 98% of Hubspot users renew each month. That sounds pretty impressive, although it does equate to losing nearly 25% over one year. A less ambiguous statistic is the current customer count of 1,400, which is higher than any other small business demand generation system I’ve seen (though still dwarfed by Infusionsoft’s 15,000 clients).

Even small businesses shouldn't have a problem with Hubspot pricing: a version without Salesforce.com integration costs $250 per month, while one with Salesforce.com integration costs $500 per month. There’s a $500 setup fee for both products, which covers four hours of consulting. There are no additional costs related to volume or anything else, although that might change when email campaigns are added. The smaller system is sold on a month-to-month basis, while the larger version requires an annual contract. The company also offers a seven day free trial.

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Helmsman Shows How To Serve Small Business Marketers

Summary: Helmsman Marketing offers turnkey marketing campaigns for small business. It's a great way to meet their needs, but probably not the model that will ultimately prevail in small business marketing automation.

I’ve spent a lot of time recently talking to marketing automation vendors hoping to sell to small businesses. They all seem to think this market is under-served and therefore open for them to dominate. In one sense they're right: there are millions of small businesses, few of which use serious marketing technology today. But the very fact that I'm talking to so many vendors means there is no lack of competition.

The entrepreneurs starting these marketing automation firms think they have few competitors because they rarely run into them. But that’s because small businesses rarely look for alternative solutions: if they see a system that seems to meet their needs, they’ll buy it and move on to the next project. Small business people just don’t have the time or expertise for elaborate vendor comparisons.

In the short term, this means that plenty of small business-oriented marketing automation vendors will prosper in isolation. Eventually, though, some will grow larger, market themselves more aggressively, and penetrate the awareness of small businesses beyond their immediate circle. That’s when buyers will recognize they have alternatives and be forced to make choices.

At the moment, though, the market is in that delightful early stage where a new vendor with a unique approach pops up every week. Last week it was Helmsman Marketing, a five-month old company focused on helping small businesses run multi-step, multi-channel, outbound customer relationship campaigns.

Ok, that last sentence is a mouthful. But I think it captures the key components of Helmsman:

- multi-step: the system runs campaigns that deliver a sequence of messages. The precise timing of these is adjusted for maximum response through the life of the campaign as Helmsman reports on results such as email opens. The reports are generated automatically and the adjustments are made manually. A typical Helsmark campaign might include five touches over several weeks.

- multi-channel: Helmsman delivers messages via email, automated voice mail recordings, fax, text message (SMS), and printed postcards. These are all managed by the vendor itself. Helmsman can also arrange to ship promotional products. The company stresses multi-channel campaigns because it has found that email isn’t always delivered and different customers will react to different media. Their use of post cards is particularly intriguing because it’s the second or third time I've recently been told that post cards are especially effective for small business marketers.

- outbound: pretty much all Helmsman does is send messages. Results like email opens are recorded within the system, but actual replies would be directed to a company CRM system or elsewhere. The one big exception is that the vendor can build and host Web landing pages and forms.

- customer relationship campaigns: most Helmsman programs are sent to existing customers to remind them of renewals or to schedule service appointments. The system is also be used for prospecting, such as seminar invitations. But the company warns that multiple contacts without an existing relationship can be annoying – particularly with intrusive media such as phone or SMS.

So that’s what Helmsman does. Integrated multi-channel capabilities are unusual, but otherwise the system offers less than most demand generation or consumer marketing automation products. What actually makes Helmsman special is something other than features: it’s a business model that is tailored to small business needs.

Specifically, Helmsman is sold as part of a service package that relieves marketers of the need to set up and execute their campaigns. According to Helmsman CEO and co-founder Tim Haller, he quickly discovered that small businesses lacked the time and skills to run a system like Helmsman for themselves. So the company meets with each new client for an hour or two to understand their goals and marketing messages, and then does the rest: designing the campaign, creating the marketing materials, sending the messages, and analyzing the results. If the customer list needs some data cleansing, Helmsman will do that too.

This approach avoids the time and skill constraints that – even more than direct cost – are greatest barriers to small business marketing automation. It also allows purely project-based pricing, derived from the numbers and types of contacts. This makes it easy for businesses to compare the costs and results of using the system, so they can judge its practical value. In the case of renewal and reminder programs, Helmsman is often fully justified by the savings from not having company staff make phone calls. Actual costs depend on the project (postage in particular is expensive), but have never exceeded $2 per contact. There’s a project minimum of about $750.

Helmsman released its product in April 2009 and currently has about 20 systems in place.

So where does Helmsman fit in the grand scheme of things? More than anything, it illustrates the importance of vendors helping clients to use their systems. Small businesses are the most extreme example of this need, but it applies to other, more sophisticated businesses as well. Helmsman also shows the importance of tying system cost to specific business value, something that its project-based billing structure does just about perfectly. The point about multi-channel contacts in general and post cards in particular is more tactical but still worth noting.

Yet despite these strengths, I don’t think the Helmsman approach will ultimately dominate in small business marketing automation. Specialized systems can be very attractive but companies don’t want too many of them. While Helmsman itself may succeed as a pure service, I expect that small businesses will ultimately adopt general-purpose marketing systems that support many applications in a single integrated environment. These systems might be sold with prebuilt project templates, similar to newsletter and Web site templates already offered by other types of vendors. Small businesses will then be able to pick and choose the projects they wish to execute without needing a separate vendor for each. Simplicity and support will always be essential for success, but the ultimate victors must combine them with flexible, extensible solutions that can grow and change with the business itself.

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Entiera Offers Consumer Marketing Automation Software as a Service

Summary: Entiera is a sophisticated consumer marketing automation system, offered as a service and at a lower price than conventional competitors.

Entiera Insight is a marketing automation system primarily for companies that sell to consumers. I’m highlighting this because most of my recent posts have been about B2B marketing automation (demand generation) systems, and the two types of systems are quite different. This means I apply different standards to evaluate them.

My template for demand generation systems includes outbound email, landing pages, lead scoring, nurturing campaigns, and CRM integration, while my template for (consumer) marketing automation has planning, project management, content management, execution, and analysis. There is certainly some overlap: “execution” in marketing automation typically includes nearly all the demand generation functions except for landing pages and Web content management. But consumer marketing automation systems generally have more advanced database, segmentation, planning, project management and analytics. (See the paper Demand Generation vs. Marketing Automation in the Resources section of the Raab Guide site for more on this topic.)

Back to Entiera. Although their Web site is tagged as “on demand marketing automation”, they have in-house staff to build, run and analyze client databases, plus compiled consumer and business files that can provide prospect lists or enhance customer records. This makes them sound more like a “hosted” vendor than “Software-as-a-Service” (SaaS), per the distinction in my July 25 post. But I ultimately classify them as SaaS because they offer self-service versions of their data loading and analysis tools. This is unusual among consumer marketing automation vendors.

Entiera Insight includes modules for campaign management, predictive modeling, marketing planning, reporting, and database management. Content management and project management are handled within the campaign module. Thus, Entiera offers all five elements of my consumer marketing automation template.

Like most consumer marketing automation products, Enteria is primarily focused on outbound campaigns. Users construct each campaign from components including filters (list selections), paths (segment definitions), channels (messages), suppressions and deduplication rules. These are laid out in a half-tabular, half-graphical format based on columns that each contain a single type of component.

For example, the first column in a typical campaign would contain a filter to select a universe; the next column might contain several path definitions that divide the universe into segments; and the third column could contain several channel definitions, each linked to one previous path. A multi-step campaign would contain several columns of channels, with each channel linked to a channel in a previous column. The terminology and interface are unusual, but should work well after some practice.

Filters and suppressions are constructed with powerful query builder that supports multiple statements, calculated values, and different types of samples (fixed quantity or percentage of universe; random, ranked or Nth selects). Records selected in one filter are automatically excluded from subsequent filters in the same column. This is a standard approach in consumer marketing systems, but often missing in demand generation products. Users can save standard queries and reuse them across multiple campaigns – another feature that’s more common in consumer than B2B systems. Entiera is rolling out a new Adobe Flex-based interface that will have similar functionality but with a more flexible, drag-and-drop style.

The channel (message) objects are assigned channel types, start dates and end dates. These dates are separate from the start and end dates of the parent campaign, although the channel dates must fall within the campaign’s date range. Channel objects can either be triggered by a specific event or execute after a specified waiting period. Although one channel object cannot be shared across campaigns, the objects are built with offers and marketing contents (such as a specific email template) that are themselves reusable. The system captures detailed information about offers, including target audience, limits on how many times they can be used and accepted, effective dates, unit cost, and retail value. This is an impressive set of features.

Campaigns are executed outside the system, either through transferring files or by sending messages to an external API. Entiera currently uses Exact Target as its email partner, although it could work with others. Users can build and reuse standard execution templates for specific destinations. They can also manage seed lists and control groups. Each campaign can execute once or on a regular schedule. The system is designed to support real-time interactions, although no client has yet deployed it that way.

Planning in Entiera is largely at the campaign level. Campaigns can be assigned start and end dates and tagged by type, objective, category and products. This lets users analyze their plans and results across different dimensions—an important need in complex marketing programs. Users can also enter actual and estimated figures for costs, revenues, audience count, responses and conversions. They can define fixed and variable costs for a campaign and have the system calculate the total costs based on volume.

Although the vendor is working on an expanded planning system, this is already more features that many marketing automation systems provide. Project management is less impressive, currently limited to campaign-level task lists. Tasks cannot be assigned to specific individuals, although this should be added by the end of 2009.

Reporting is available through a mix of standard and custom reports. Standard reports track performance by campaign, type, and channel, including responses, conversions, revenue, costs, and return on investment. Users can also see results for different offers and creative types, as well as responder profiles based on demographic information appended from the vendor’s compiled files. Custom reports are built in Jaspersoft open source software. Users can access different views of the underlying database, allowing them to work with data that is organized and named in ways that suit their individual needs. Custom reports can be saved, shared, combined into dashboards, and distributed by email on a regular schedule.

Entiera also supports advanced analytics and database management. A graphical interface lets clients create complex data flows to import and combine multiple sources. It can do name/address matching for customer data integration and can easily incorporate the company’s compiled lists. Kxen statistical software is integrated for end-user predictive modeling and scoring.

I trust it’s clear by now that Entiera is designed to support complex marketing operations. Security is also enterprise-grade, allowing different users to access different functions, data sets and campaigns. The interface supports different languages for different users within the same installation, a subtle feature which identifies enterprise systems. Entiera also supports portals (with message boards, document repositories, Wikis, etc.) that can be open to everyone or limited to a particular group.

The cost for all this is not cheap, but still considerably below a traditional enterprise marketing automation system. Part of the difference is that Entiera includes database management, reporting, analytics, hardware and other costs that would be purchased separately with traditional marketing automation software. In addition, fees for Enteria are just not that high: a mid-size consumer marketer might pay $20,000 to $40,000 per month, which is about half the cost of a traditional on-premise system.

Entiera was founded in 2005 and released the first version of Insight in 2006. The company has about a dozen Insight clients, and many more using its other services.

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Genius.com Adds Short URLs to Capture Social Media Replies

Summary: Genius.com is adding a URL shortener that will tie social media responses into the regular flow of demand generation and lead management. It’s a small but important step towards making social media a standard business tool.

I saw a quick demonstration today of a new social media feature that Genius.com will release at the end of September. It generates short URLs that directly connect social media responses with Genius.com’s standard marketing and sales support features. Here’s the press release.

As I wrote in my February post on Genius, the system creates links to a proxy server that can track Web site visitors within the demand generation system without actually modifying the Web site. (Typically, such tracking requires a landing page built in the demand generation system or a tracking script embedded in the regular site pages.) The Genius link can either point to a landing page created by the salesperson or marketer in Genius or pass the visitor directly to the existing Web page. These links are typically placed in an email created by a salesperson or marketer. The new feature is a desktop widget that creates short versions of such links so they can be added to social media responses such as a Twitter post, Facebook page or blog comment.

This both is and isn’t a big deal. From the technical and end-user standpoint, Genius has simply made it easier to access its existing technology. That’s a very small step. But from the business standpoint, inserting Genius URLs (inevitably if painfully shortened to “GURLs”) means that links in a social media post can now be tracked like other online responses: that is, the visitor can be tied to the original source, assigned a tracking cookie, shown special messages and added to normal lead processing streams. In Genius’s case, this means that visitors can be associated with a company via their IP address, offered an online chat and scored on their activities and form responses, while salespeople can be alerted to important events, find related data or leads in JigSaw or LinkedIn, replay the Web site visit and access the full activity history.

In other words, Genius has taken a major step towards integrating social media with the standard sales and marketing toolkit. Companies must still find effective ways to monitor and respond to social media events. But once that happens, the new Genius feature will let them manage all further interactions with the same tools and processes as leads from any other source. This is major progress, and a capability that I haven’t yet seen from other demand generation or CRM vendors.

That said, there’s a business strategy question of whether this product will give Genius.com a significant competitive advantage. I suspect other vendors could easily create the short URLs themselves and distribute them on a desktop widget. It would be harder to match Genius.com's technology for letting salespeople and other non-marketing users add their own landing pages. But I suspect most companies will want social media users to rely on a standard set of company-approved links. So that particular part of Genius.com's technology may not really matter.

However, I think the real use case is people pointing to ANY page on a company Web site* that happens to answer a specific social media query. In that case, what matters is the ability to create a short URL that activates the demand generation tracking features. This fits perfectly with the Genius.com proxy server. I don't know how difficult it would be for other vendors.

It's also true that Genius.com has a general advantage in dealing with non-marketing users because its original product was aimed at salespeople. But other demand generation vendors are already working hard to extend in that direction so I don't know how long Genius.com's lead will persist.

Whether or not Genius.com gains a long-term advantage, they certainly deserve credit for being the first (so as I know) to deploy this extremely creative and valuable idea. But the great thing about competition is that if a new feature is really valuable, other vendors will copy it—and then everyone benefits. To me, that’s the best outcome of all.

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* Genius.com only lets users link to pages the user's email domain, or others site for which they have explicit permission. This prevents them from intercepting links meant for someone else.

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Why Most Consumer Marketing Automation Systems Are Not Software-as-a-Service, And When That Will Change

Summary: Consumer-oriented marketing automation systems have been slower to adopt the Software-as-a-Service model than business marketing (demand generation) systems. But this will soon change, bringing lower prices and better systems as a result.

Software-as-a-Service (SaaS) is now the standard model for business-to-business marketing automation (a.k.a. demand generation) systems. Any vendor who didn’t sell that way would be an oddity. But consumer-oriented marketing automation products from vendors like Unica, SAS and Teradata are still commonly sold as traditional on-premise software.

Hosted vs SaaS: What's the Difference?

Many of the consumer-oriented vendors do offer “hosted” versions of their systems. These resemble SaaS in that the software is maintained off-premise by a third party. But clients typically still purchase of a perpetual license rather than paying monthly fees, as in SaaS. More important, the hosted systems are still largely configured and managed by the vendor or a business partner such as a service bureau. To me, the essence of a SaaS system is that users can largely do this for themselves.

I’m making a distinction here between running the software on your computers, which both hosted and SaaS vendors do, and managing each client’s implementation and on-going data maintenance. Hosted vendors do this for their clients but SaaS clients do for themselves. Although this distinction may be fuzzy in some cases, I still think it's important.

There are also technical distinctions that identify SaaS systems, such as whether one system serves multiple customers ("multi-tenancy"). Some people would argue that true SaaS systems are by definition multi-tenant and hosted systems are not. Mostly I’d agree, except that I can think of several conventional systems with versions that a service bureau can install to support multiple clients. Those are multi-tenant by any reasonable definition, but they’re managed by the vendor in the way that SaaS software (as I conceive it) is not. Multi-tenancy itself comes in several versions, depending on whether the hardware, software, and/or the database instance are shared. These have important technical and cost implications, but they aren't relevant to this post..

Why Consumer Marketing Systems Have Lagged in SaaS Adoption

What caused the divergence between consumer and business marketing systems? Much has to do with timing: the major consumer-oriented products were developed when on-premise software was the standard, and the large organizations who are their major customers have been relatively slow to accept SaaS in general. By contrast, the demand generation systems are newer and are sold to smaller companies, which have been early adopters of SaaS.

In addition, consumer marketers tend to manage the entire customer relationship, which requires integration with other corporate systems such as billing and customer service. Until recently, few SaaS vendors could handle such integration effectively. Business marketers generally limit their focus to lead generation and nurturing, which at most requires light synchronization with sales.

Consumer marketing databases also generally have more data feeds and more complex update processes than business marketing systems, again because the consumer systems are managing existing customers as well as leads. This makes them harder for consumer marketers to run without assistance, and thus less suited to the self-service-based SaaS approach. Yet even this is changing, as SaaS tools deliver greater power to non-technical users. For example, SaaS-based business intelligence vendors like Birst and Autometrics offer data integration capabilities that could form the basis for building a marketing system. The increasing openness of SaaS products also makes it easier for them to call on external data integration services.

In short, there’s nothing inherent in consumer marketing that prevents use of the SaaS model. The early obstacles that led to quicker adoption by business marketers are rapidly falling. We can expect the major consumer marketing automation vendors to continue to evolve their hosted offerings towards a true SaaS approach. We can also expect new entrants that are SaaS-based from the start, such as Neolane and Entiera (which I plan to review next week). And we’ll probably see marketing capabilities added by SaaS vendors in related industries such as email services (early example: Silverpop’s acquisition of Vtrenz, now Engage B2B) and Web content management (see my reviews of Marqui and SiteCore).

SaaS Systems Will Bring Lower Costs and Better Products

This can only be good news for consumer marketers. Pricing of conventional consumer marketing automation systems has remained stubbornly high in recent years. This is in part because of limited competition, but also because the bulk of the ownership cost is in the labor to deploy and maintain the systems. High labor costs mean that lower software prices would do little to encourage sales, since the buyer’s total expense would remain nearly the same.

By contrast, business marketers have seen ever-lower prices and rapid innovation as a multitude of SaaS-based vendors enter the field. These systems take very little labor to deploy, since that’s inherent to the SaaS model. In fact, implementation fees have in many cases fallen to zero, making the software fee itself the main expense. (The user’s own labor is another cost, but it’s largely hidden and difficult to estimate in advance; it therefore plays a minor role in the purchase decision.) The result is heavy competitive pressure to cut software prices, as vendors scramble to gain enough customers to cover their (largely) fixed costs.

SaaS-based consumer marketing automation systems have fundamentally similar economics, so we can expect similar results: new entrants able to deploy their systems at lower total cost than conventional software (because users do more of the work) will reduce their prices to achieve an adequately-large customer base.

The process will play out over several years as the SaaS based systems evolve to support more sophisticated marketing and greater end-user self-service. This means the new systems will start in the less-demanding lower and middle segments of the market and eventually work up to the largest marketing automation deployments. Still, the trend is clear and, so far as I can tell, quite inevitable.

It’s a great time to be a marketer.

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Simple Usability Studies Are Still Worthwhile

Summary: Web usability guru Jakob Nielsen has proven that simple usability tests are highly effective. Marketing automation vendors should take heed. Come to think of it, so should marketers.

A vendor very proudly showed me their new Adobe Flex-based user interface the other day. Flex is a “rich Internet application” technology, meaning it gives you drag-and-drop, pop-up windows, and other features of a desktop graphical user interface. I found the new interface a bit confusing, so I asked whether the vendor had done any usability testing. He said they hadn’t done anything formal, because of the cost, but had shown it to many current users who were very enthusiastic about the change. Fair enough.

By coincidence, a random Twitter post this morning pointed me to the blog of Web usability guru Jakob Nielsen. The specific post had to do with a study of mobile phone usability, which you won’t be surprised to find is dismal. But what particularly struck me was the relative simplicity of Nielsen’s methods – the study involved just a few dozen users doing selected tasks and its primary metric was the straightforward one of success rate. (I don’t mean to suggest the study itself is simple – the full report runs 132 pages and costs $198.)

Poking a bit more around Nielsen’s blog and Web site, I saw that simple usability studies are a recurring theme. For example, he showed back in 2000 Why You Only Need to Test with Five Users and made a more recent case for Fast, Cheap, and Good testing methods. Indeed, yet another post on Guesses vs. Data as Basis for Design Recommendations demonstrates that testing even two users is better than guessing.

Now, it’s true that Nielsen is measuring Web site usability, which is considerably less complicated than usability for a software application such as a marketing automation system. But I still think his point and his methods are valid: even a little usability testing goes a long way to help designers make the right choices. It’s something I hope more vendors will keep in mind.

Of course, Nielsen's work is even more directly applicable to the landing pages and other Web site components that marketers construct for their own use. Most marketers don't test enough in general, so you can see usability testing as just one example of the larger problem. But usability testing methods are different enough from standard marketing tests to think about them separately. The fact that they can be done very simply and before a page or site is launched actually means there is less reason not to do them, and greater value when you do.

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Jesubi Doubles Sales Prospecting Efficiency

Summary: Jesubi is designed to make sales prospecting as efficient as possible. It shows how specialized software can be much better at one function than general purpose systems. You may not want to replace your CRM system with Jesubi, but dedicated prospecting teams should take a close look.

The latest stop on my little tour of not-really-demand-generation systems is Jesubi. The flash show when you enter the company’s Web site could easily be mistaken for a demand generation product – it lists campaign workflow, list segmentation, email templates, Salesforce.com integration and dynamic reporting. Only a couple of other items hint that this is really a product for sales departments: manage calling queues, track appointment quality and record call history.

Once the flash has run its mercifully-brief course, a more concrete promise appears in delightfully large type: “DOUBLE YOUR SALESFORCE DON”T DOUBLE YOUR COSTS”. Except, um, this message still doesn’t quite clarify what they’re selling. I would have guessed recruiting services or maybe offshore outsourcing. But the succeeding text finally ends any confusion:

“Jesubi is for companies that:

• Have a sales team
• Need to increase prospecting activities per hour
• Need real-time visibility by rep, campaign, industry
• Want to proactively reach their market place
• Want to generate and qualify more leads
• Need to measure response rates of messages”

That’s a lot of words, but you had me at “increase prospecting activities per hour”.

Indeed, what impressed me about Jesubi was its very tight focus on prospecting productivity. The system was originally developed for its own use by outsourced appointment generation vendor LeadJen. As Jesubi president Bill Johnson tells the story, LeadJen originally worked directly with its clients’ CRM systems but found they were poorly suited for systematic prospecting. Jesubi was the result, and more than doubled LeadJen’s touches per hour when it was introduced in 2007.

Another way to look at it: Johnson showed me that it took 12 clicks to log an email in Salesforce.com, compared with about three clicks in Jesubi. Multiply that savings by hundreds of contacts per day and you’re talking real value.

Everything else about Jesubi needs to be understood in this context of inside sales productivity. Yes, it does list segmentation, emails and multi-step campaigns, but these are not the outbound email blasts or unattended lead nurturing campaigns of a conventional demand generation system. Rather, the emails exist largely to support telephone calls, either in advance or as follow-up, and the campaign steps are largely tasks for sales people.

The real attention has gone into scheduling and recording one-on-one interactions. For example, Jesubi makes it easy to capture referrals and link them back to the original contact, so the system can accurately report on the value generated by each name. Building these links is difficult in most CRM software and virtually impossible in marketing automation systems.

System reports are similarly tailored to tracking prospecting results. Jesubi provides detailed statistics on the outcomes of each contact within a campaign, as well as highlighting results for each sales person. The goal is to help managers understand which activities and which workers are most productive, so they can quickly correct problems and improve results.

Jesubi does provide standard contact management functions, such as call notes, opportunity tracking, and Microsoft Outlook integration. Johnson said about 40% of Jesubi clients use it as their primary CRM system, while the balance integrate it with Salesforce.com or another CRM tool. Automated synchronization is available for Salesforce.com using their standard APIs.

Jesubi is offered as a service, with pricing starting at $100 per user per month. Implementation adds $1,500 to $5,000 depending on complexity. Much of the effort is dedicated to setting up custom categories for campaign activities and outcomes so the system runs as smoothly as possible. Jesubi was made commercially available early this year and currently has about 35 clients averaging about ten users each.

Although I’ve described Jesubi as a sales system, Johnson points out that this type of prospecting is sometimes the responsibility of marketing. This makes Jesubi yet another example of the much-discussed blurring between the boundaries of marketing and sales. It’s also an great example of the true meaning of usability – a product that is very well suited for a particular purpose, even though its capabilities for other tasks are limited. Just thought I’d point that out.

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Active Conversion Offers Strong Lead Management and Leaves Out the Rest

Summary: Active Conversion helps marketing and sales departments make the best use of leads they’ve generated outside the system. That's fewer functions than traditional demand generation, but if those are the functions you need, who cares?

The classic demand generation cycle starts with an outbound email campaign, captures replies on a landing page, scores the responses, and then sends qualified leads to a sales automation system and keeps the others for more nurturing. These functions, plus supporting features for database management, content management, sales system synchronization, and reporting, form a basic template for measuring demand generation software. (For a more detailed description of this cycle, see Introduction to Demand Generation Systems in the Resources section of the Raab Guide. Registration is no longer required.)

But while this cycle is simple, the actual boundaries of business marketing are not so clearly marked. Leads can enter from channels other than email. Information can come from sources beyond the lead itself. Sales and marketing activities are increasingly intermingled, and sales people increasingly work with directly with marketing systems.

Adding these items to an evaluation template is not especially difficult. But a longer list of options creates more potential combinations. This makes it harder to define any particular combination as “standard”.

That’s just my problem as an analyst. From your perspective as a marketer, having more combinations available makes it more that someone will field a configuration closely tailored to your needs. So, on balance, more options is good news.

For example, take Active Conversion. As an outgrowth of search engine marketing specialist FoundPages, the system naturally incorporates strong features for tracking Google AdWords campaigns, calculating return on investment, and measuring visitors’ Web activities. But it only recently added even simple landing pages and Web forms, and still has limited lead scoring, email and nurturing features. Yet some other features are fairly advanced: Active Conversion can identify anonymous Web site visitors through reverse IP lookup, find contact names for those companies in JigSaw, and either send the data to Salesforce.com or let sales people access it withing Active Conversion itself.

This particular constellation of features is far from random. It’s designed to address a specific business need: helping small to mid-size businesses use leads generated by their inbound marketing programs.

Outbound email campaigns are largely irrelevant to this, so ActiveConversion doesn’t even offer email services. Rather, it allows users to email provider VerticalResponse or a different service of their choice. This keeps down the cost of ActiveConversion’s operations and therefore its prices, although of course marketers will have to pay someone else for their emails.

The system does create emails for multi-step lead nurturing campaigns, although these are still sent by the external email serivce. Even here, selections can only be based on a handful of tracked Web behaviors and whatever custom tags the user has set up in Web forms. These tags are needed even for attributes such as company size or buying intentions, since the standard lead database – which cannot be changed – stores only contact name, company, title and email address. ActiveConversion assumes that other attributes will be stored in the external email system or Salesforce.com, and any selections using those attributes will be done in those systems.

The nurturing campaigns themselves are also quite simple. Users can define an initial list, either imported from an external system or selected from the Active Conversion database. They then define one or more emails that are scheduled either for a specified date or relative to when a visitor submits a specified Web form. There is no additional campaign logic, so everyone who starts a campaign will receive the entire sequence of messages unless a user manually removes them from the initial list.

Filling out a Web form may also contribute to lead scoring. Scores are based on a handful of Web activities: return Web visits, numbers of pages viewed, clicking on an email, reaching a "goal" Web page (there can be more than one), and making a download. Each of these is assigned a point value. The user then sets the point totals that define three lead ranks (low, medium and high), the minimum rank for a "qualified" lead, and the minimum rank that will send the lead to Salesforce.com. This is vastly simpler than lead scoring and transmission rules in most demand generation systems, but Active Conversion says its clients don't want anything more.

What clients do care about is helping their sales people: so Active Conversion features in that area are pretty much state-of-the-art. I’ve already mentioned IP-based visitor identification and JigSaw integration. The system can also route new leads to appropriate sales reps based on territory assignments and custom tags; alert the assigned rep when a targeted lead makes a return site visit; let the sales rep view detailed Web activity logs, either within Salesforce.com or Active Conversion’s own SalesView application; and let reps assign leads to Active Conversion nurture campaigns. Sales reps can also receive regular reports via email on activities by prospects, qualified leads, and targeted companies.

In short, what we have here is the set of demand generation features that are needed for lead management, and very little else. If that happens to be what you need, Active Conversion is worth a look.

Active Conversion is offered as a service with prices based primarily on Web traffic. Rates start at $250 per month for up to 1,500 unique visitors, and are $500 to $600 for 10,000 to 20,000 visitors. This is considerably lower than most demand generation products, although it doesn’t include email transmission. Integration with Salesforce.com and Microsoft Outlook email each add $50 per month, while SalesView costs about $20 per user per month depending on the number of sales reps.

The system was released in 2007 and is currently installed on nearly 200 Web sites, spread among a smaller number of clients.

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Right On Interactive's 5Buckets Simplifies Multi-Channel Messaging

Summary: Right On Interactive's 5Buckets connects lists from external customer management systems with many types of output vendors (email, print, fax, text message, automated voice). It's a low-cost, easy-to-use alternative to more powerful marketing automation systems for companies who don't need other marketing automation features.

Last Wednesday’s revised ranking of demand generation vendors by Web traffic reminded me that I never published notes from a conversation I had several months ago with Right On Interactive, developer of the 5Buckets marketing automation software. Now is a good time to remedy that.

5Buckets isn’t actually a demand generation system, at least according to my usual definition. Rather, it matches the functions of a traditional campaign manager: accept inputs from external sources (CRM, Web sites, surveys, transactions), create lists from those sources, and send the lists to external systems for delivery. It can also combine its inputs into a persistent marketing database, but that's optional. Most clients just select directly from the external systems instead.

This is a much narrower scope than conventional demand generation systems: no email blasts, no landing pages (although the system does generate online forms), no content management, no lead scoring, and limited CRM integration. There's no query builder or "fuzzy matching" to identify records in different systems that relate to the same customer. The system does maintain a cross reference table to link records where different keys from different systems are known to refer to the same individual. The company plans to expand some of these database-related features by the end of this year.

On the other hand, unlike traditional demand generation systems, 5Buckets includes promotions to existing customers as well as sales prospects. By my definitions (see Demand Generation vs Marketing Automation on the Raab Guide Web site), this makes 5Buckets a type of marketing automation system.

Of course, the labels matter less than what the system does. The core feature of 5Buckets is its ability to run campaigns that direct output to different media. Campaigns can be triggered manually or run automatically on a regular schedule. They pull data from external lists and can execute actions including: send a message (email, voice mail, print, fax, post cards, mobile text); update Salesforce.com (create a task, send an email through Salesforce.com, update Salesforce.com bounce history); or get a record count.

A scheduled campaign can contain multiple steps, each with its own list (or “bucket”) and action. The lists are created in the source systems, independently of 5Buckets, and then imported. Existing integrations are available for Salesforce.com, Exact Target, Avectra netForum (association membership), and RealPage (property management). The system can also execute SQL queries. Although the lists are defined using the source system's own selection tools, 5Buckets’ itself does let users include or exclude one bucket from another. This makes it easier for records in a campaign to flow from one bucket to the next. But time intervals between steps must still be built into the external selection rules. Additional selection capabilities are also planned by year-end.

5Buckets hasn't made list selection a priority because it assumes that source systems can already do it. Instead, it has focused on making it simple to send messages in any channel. The vendor has standard connectors for ExactTarget, Salesforce.com and Delivra email; Vontoo voice messaging; PremiereGlobal fax and fax mailmerge; XpressMessages postcards and sales letters; MessageBuzz text messaging and ConnectiveMobile voice and text messages. Most marketers would find it very difficult to run on-going campaigns through so many channels without 5Buckets or the equivalent.

Pricing is also intended to make things simple. 5Buckets costs $6,000 to $12,000 per year depending on the number of schedules and connections. This is much less than conventional marketing automation systems like Unica or Neolane. Although some demand generation systems are in a similar range (see my ever-popular post Low Cost Systems for Demand Generation ), they don’t have 5Buckets’ prebuilt connectors.

Indeed, Right On Interactive VP Marketing Richard Cunningham says he considers 5Buckets to be complementary rather than competitive with traditional marketing automation systems. I’m not so sure, but do suspect 5Buckets will be attractive to marketers who want to automate multi-channel campaigns without other marketing automation functions. Since 5Buckets itself will probably expand its features over time, automated campaigns are a good place to start.

5Buckets was introduced in early 2008 and currently has about 30 implementations shared by about 300 organizations. (The difference is that several implementations are used by multiple entities, such as franchisees and business association members.) Right On Interactive is a marketing services agency but is shifting its focus towards software: of the 5Buckets implementations, only five to ten also use unrelated Right On marketing services.

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Alterian Pushes Into Social Media Management with Techrigy Acquisition

Summary: Alterian's purchase of Techrigy marks the first integration of serious social media management with marketing automation. Others are sure to follow.

Marketing automation vendor Alterian yesterday announced its acquisition of social media monitoring company Techrigy. Even though the Techgrity deal is the first direct acquisition I recall of a social media monitoring system by a marketing automation vendor, it strikes me as an obvious step. Marketers have been scratching their collective heads for years over how to integrate social media, and marketing automation vendors are very aware of their needs.

I’m not even totally surprised that Alterian was the first to jump into this pool. Although other marketing automation vendors like Unica and SAS are generally more expansive, Alterian has been particularly aggressive about integrated customer management. Previous acquisitions include Web content management (MediaSurface, 2008), contact optimisation (Campaign Calculus 2.0, 2007), email (Dynamics Direct, 2006), marketing resource management (Nvigorate, 2006), and hosted analytics services (MarkIT, 2005).

In fact, according to Alterian’s very interesting FAQ about the Techrigy acquisition, “Engagement marketing” is the core of their current corporate vision. Although I’m generally allergic to sweeping vision statements, I think Alterian has earned the right to use that one. Sparingly.

What really impresses me is that Techrigy is a serious social media monitoring solution. This isn’t about making it easy to react to comments on Twitter, add friends on Facebook, or research prospects on LinkedIn, which is how most marketing automation vendors are approaching social media. Instead (or in addition) Techrigy supports sophisticated searches, categorization, sentiment analysis, influence measurement, author tracking, and case management.

This set of features means that Techrigy is really built more for corporate PR departments and marketing agencies than one-on-one customer management. But that makes the acquisition still more intriguing. I expect Alterian to extend the product to monitor and manage individual relationships, thereby integrating social media with other aspects of customer management.

This would be a major step beyond using aggregate social media data as a way to measure marketing performance – although even such measurement would be itself a great leap forward for most companies today.

It’s by no means certain that Techrigy can actually scale up to manage this many individual relationships. Current users probably track just a small number of individuals and cases, such as key bloggers and specific complaints that must be resolved. Ramping from that to tracking millions of individuals is likely to uncover serious bottlenecks. But even if the system can’t do this today, Alterian should eventually be able to rework it to overcome any obstacles. This sort of processing is a good fit for Alterian’s columnar database engine, which is the core of its business.

I spent some time playing with Techrigy yesterday, using the free version available on their Web site. This allows only 1,000 search results, which is far too few for any real business purpose. But it did give a good flavor for the system.

On the whole, I liked Techrigy very much. Per my previous comment, I was particularly impressed with the scope of the functions.

These start with searching for articles to analyze. The search interface allows advanced logic, complete with Boolean statements, local and global exclusions, and rules to assign the articles to categories for later analysis.

The searches run against articles assembled by Techrigy in a database that stretches back for two years and includes 1.5 billion entries. Sources include blogs, social networks (publicly-accessible sections of Facebook, MySpace, etc.), microblogs (Twitter, Friendfeed, etc.), message boards/forums (such as LinkedIn discussions), wikis (such as Wikipedia), video and photo sharing sites (Flickr, YouTube), and some mainstream media blogs (The New York Times, Wall Street Journal). Querying this database is where the Alterian database engine should shine – yesterday, running even my simple searches took longer than I’d like.

Users can also add their own feeds to search. This could not only capture specialized sources that are too small for Techrigy to monitor, but might include private sources such as a company’s user forums. This opens up a range of important applications beyond public social media tracking.

Searches can run on command, continuously, or on a regular schedule. Results can be streamed to an external viewer as an RSS feed or presented in standard reports. The most basic report shows daily volumes with trends over time. Results can be categorized and filtered based on author popularity (a 0-10 score based on audience), author demographics (age and gender, where known), domains, sources, and keywords. Additional reports show word clouds with themes, which can be derived from keywords or more advanced semantic analysis. There's even a Google Maps mash-up to show author locations. The semantic engine can also tag posts with positive or negative brand sentiment, content tone and emotions.

Users can dig into these reports to view the underlying articles. The system starts with a list of article summaries, similar to a set of Google search results. Users can then select an article and drill into its details, including extracted Web site information and traffic rank, content analysis showing sources of the system-applied tags, the full article itself, and links to Alexa, Technorati, Compete and Quantcast information about the article source.

Users can also delete the entry, mark it as spam, adjust the system-assigned tags, and edit information about the author. This author tracking is what could ultimately be expanded into tracking of individual customers.

Finally, users can assign the article to a user for review or action. This engages the workflow system, which can notify the assigned user and keep track of the article’s status, notes and priority. Here the system moves from social media monitoring into actual relationshipship management.

Techrigy’s user interface is generally okay, although I sometimes had a hard time finding functions such as how to rerun a report. This would presumably go away after a bit of experience. Response time was a little slower than I’d like for tasks such as a applying a filter or presenting an article list. However, this might not be typical: the Alterian acquisition has attracted a lot of attention and generated more than 400 new trial users (per a Twitter post). In any case, this is where the Alterian engine should help.

As for the semantic engine itself – I was underwhelmed by the accuracy of the results. I especially enjoyed the Twitter post “Twitter for B2B Marketing - Marketo: Sin Descripción http://tinyurl.com/mfuh3n” being tagged as negative, religious, and – wait for it -- written in Danish.

A more serious problem is articles like “Ten Mistakes Marketers Make” being tagged as a strongly negative brand reference. But this is probably an issue with most semantic engines (I had a similar problem with ScoutLabs). Presumably Techrigy’s accuracy will improve over time. But even if it doesn’t, users will adjust to what it can do. In practice, you’d expect a company to review all entries tagged as negative, which would then be reclassified or dealt with as appropriate.

Current pricing for Techrigy starts at $600 per month for 20,000 stored search results. Of course, pricing could change under the new ownership.

In sum, Techrigy is an interesting product on its own, but the real story here is the potential for merging social media with other marketing systems. Although this was clearly inevitable, it’s exciting to see Alterian start to make it happen. We can expect other marketing automation vendors to follow quite quickly.

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More on Web Traffic Rankings for Demand Generation Vendors

Last week’s post on Web traffic rankings of demand generation vendors generated a couple of private responses from vendors, pointing out that the Alexa statistics include traffic to operational subdomains for client landing pages and user log-in. In itself, this doesn’t bother me, since it provides data on actual use of the systems. But different products work differently*, so figures for some vendors include landing page traffic while figures for other vendors do not. This makes the rankings even less accurate than they seemed before (which wasn’t very accurate to begin with).

Despite these concerns, I still think the Alexa figures are a useful measure of vendors’ relative market position. My ultimate justification is that the rankings roughly correspond to the vendors self-reported client counts and growth rates. There's value in having an objective, non-self-reported measure, even a crude one, to put the different competitors in perspective.

Some of the vendors offered alternative measures, such as search counts from Google AdWords. Those are interesting too, although they are probably more driven by the scope of the vendor’s marketing program than anything else. My admittedly vague notion of “market presence” includes more than the number of inquiries a vendor is attracting. Basically the goal is to help people identify the “major players” in the industry, since most buyers want to focus on those products.

An interesting by-product of the post was to learn that some marketers were apparently questioned by their management about why they ranked where they did, with the implicit suggestion that a low rank suggested they were doing a poor job. Given that the Alexa figures are heavily influenced by existing client activities, this is not at all a fair inference.

That the question came up at all suggests these companies have not already established standard measures of marketing performance. If such measures were in place and reported regularly, then a random and irrelevant factiod like the Alexa rankings would not have raised any concerns or at least would have made it easy to respond. I guess it’s no news that many companies don't have proper marketing performance measures, but this is still more evidence of why they need them.

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* Most vendors host landing pages for their clients, but sometimes the addresses are a subdomain of the client site rather than of the vendor. Client subdomains would presumably not be captured in the Alexa statistics. Many vendors offer both options, so their statistics would capture traffic for some client landing pages but not others.

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SiteCore Adds Analytics and Marketing To Web Content Management

Summary: SiteCore has added extensive analytical and marketing features to its Web content management system. The integrated analytics should save considerable effort for marketers. Channel-specific marketing automation is less appealing but should help to keep marketing automation vendors on their toes.

I commented last month that more Web content management system (CMS) vendors are adding marketing automation features. One of my examples was SiteCore, so I can’t point to them again as further proof of that assertion. But I did have a good talk last week with SiteCore VP Marketing Darren Guarnaccia, who clarified why this is happening and made a strong case for the integrated approach.

For those of you who (like me) are unfamiliar with SiteCore: it is an eight year old provider of Microsoft .NET-based Web content management systems, with over 1,600 mid-to-large sized customers running more than 20,000 dynamic Web sites including Sara Lee, Toshiba, Omni Hotels and Dollar Rent-a-Car/Thrifty. In other words, it is a substantial player in a crowded market.

According to Guarnaccia, the company has seen control over the CMS selection process steadily migrate from IT departments to marketers over the past four years. The trend is most pronounced at mid-sized firms, where IT is generally less powerful than at very large companies. During this time, it’s become clear that marketers need features that go beyond editing Web pages, to helping them do a better job of understanding and reacting to customers. SiteCore describes this as closing an “actionability chasm” between analytics and execution.

The chasm is created by the traditional approach of using analytical systems (often sold as externally hosted services) that are separate from the underlying content management system. Capturing detailed information with such systems involves much more than adding one code snippet to a shared page template. At a minimum, each page must be given its own ID and, more realistically, pages must be given multiple tags to facilitate analysis. Companies running several separate analytical systems may need several sets of tags.

The practical result of such an arrangement is that marketers and their Web teams quickly fall behind in their tagging, and end up with incomplete and unreliable analytics. Building analytics into the CMS allows users to avoid some tags altogether and makes it easier to reuse the rest. Integrated analytics also allow the system to track visitors with first-party cookies, which are less likely to be erased than the third-party cookies used by some stand-alone analytical products.

Integration also makes it easier to coordinate activities such as personalization, behavior-based targeting, and tests. The logic for these potentially overlapping functions can be all managed as part of one Web page definition, rather than separately.

For example, SiteCore supports lead scoring by assigning content scores (for technology, marketing, sales, pricing, tech support, etc.) to each Web page or, potentially, to components within a page. The lead score for each visitor’s interest in each category is the sum of the category scores for all the pages that person has visited. The same information can be used to identify the visitor’s business role or assign a persona.

The advantage of page-based scoring is that the scores adjust automatically to new Web contents. Otherwise, the company must rely on one team of workers to add new content and a separate team to incorporate the new content into the scoring rules.

Guarnaccia offered a Web site marketing maturity model that started with traffic statistics and extended to user experience statistics, content profiling, segmentation, conversion tracking, campaign management, sales enablement (using the IP address to identify visitor location and company), testing and optimization, and real time personalization. He said these are all present at no extra charge within the latest version of SiteCore, which was released at the end of June as the SiteCore Online Marketing Suite. An online demonstration confirmed they are indeed available, and at an impressively high level of sophistication.

SiteCore organizes these features around the individual Web pages. Attributes for each page include interest scores already mentioned, plus goals and other events that are logged to the visitor's history profile when the page is viewed. A page view can also trigger actions including test execution, personalization, data updates, parameter setting, sales alerts, and calls to external scripts. The system also captures the usual Web analytics data such as traffic volume, referring and exit pages, and on-site search terms. It can also use the visitor history to play back the sequence of pages viewed during a Web session.

This page-centric view of the world makes sense for a CMS vendor, but it's a pretty big switch from the campaign-centric view of most marketers and most marketing automation systems. In fact, the biggest objection to CMS-based marketing automation may be that it assumes everything is centered on the Web site.

Guarnaccia didn’t see it that way. He suggested that marketers will use separate systems for each channel. I think that SiteCore’s main goal is to replace stand-alone Web analytics and personalization systems, not to provide cross-channel marketing automation. Still, the company does plan move beyond Web marketing by adding outbound email campaigns in a few weeks. It will also support emails triggered by Web page visits.

My own take is that building analytics into the CMS makes sense, but I doubt marketers want new silos in the form of channel-specific marketing systems. If so, SiteCore’s marketing features will be most appealing to companies that interact with customers primarily through the Web. For those firms, the Web site could reasonably be the core customer management system. Systems for other channels then would connect with the Web database in the same way that auxiliary channels are (sometimes) now integrated with a central Customer Relationship Management (CRM) system.

The CMS-based model relates to other industry trends: integration between marketing automation and sales systems, and, more broadly, absorption of marketing automation into operational systems. For companies where the Web site is the primarily operational system, these are exactly the same thing. For companies where the Web and CRM are both important independent systems, marketing automation is an ally they may both wish to annex.

For now, though, SiteCore is working to cooperate with CRM rather than replace it. The system can scan IP address registries to identify a visitor’s geographic location and company, and then use the results to route leads, alert sales people, and aggregate data at the company level. SiteCore has built data synchronization for Salesforce.com and Microsoft Dynamics and will add other systems as clients request them. If further integration is needed, other systems can access the SiteCore databases directly.

This access is simplified because SiteCore is traditional on-premise software, not an externally hosted service. Pricing is based on the number of concurrent users and servers. A single server license starts as low as $15,000, although an average installation runs about $90,000. The vendor provides several days of classes, including about two days for marketing users.

The reasons for CMS vendors to add marketing automation functions are clear: to differentiate themselves and to capture budget now spent on analytical and marketing systems. It makes perfect sense for companies selecting a new CMS to prefer integrated analytics, and in some cases to add integrated marketing automation. It’s less likely that companies will discard an otherwise-satisfactory existing CMS just to get these features. But the normal replacement cycle runs three to five years, according to Guarnaccia, so it won't be long before most marketers find themselves with integrated analytical features and new marketing automation options. Even if marketers don't use all of those features, the possibility will encourage stand-alone marketing automation vendors to improve their own products to keep pace.

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ParAccel Toots Its Horn and Revs Its Database Engine

Summary: Over the past year, columnar analytical database vendor ParAccel has methodically proven its claims about speed, scalability and easy deployment. Now it's looking to grow fast.

When I first wrote about analytical database vendor ParAccel in a February 2008 post, it was one of several barely distinguishable vendors offering massively parallel, SQL-compatible columnar databases. Their main claim to fame was a record-setting performance on the TPC-H benchmark, but even the significance of that was unclear since few vendors bother with the TPC process.

Since then, ParAccel has delivered an impressive string of accomplishments, including deals with demanding customers (Merkle, PriceChopper, Autometrics, TRX) and an important alliance with EMC to create a “scalable analytic appliance”. To top it off, they recently announced their 2.0 release, a new TPC-H record, and $22 million Series C funding. (Full disclosure: they also hired me to write a white paper.)

Of all these, perhaps the most significant news is that the new TPC-H benchmark comes at the 30 terabyte level.* ParAccel’s previous TPC-H championships were at the 100 GB to 1 TB levels.

The change reflects a general growth in the scale of systems supported by MPP columnar databases. ParAccel reports its largest production installation holds 18 TB of compressed data, which probably translates to something more than 50 TB of input. Segment-leader Vertica reports several production installations larger than 100 TB. Neither had more than 10 TB in production a year ago.

These figures still don’t put the columnar systems in the same ballpark as the petabyte-scale database appliances like Netezza, Greenplum and Aster Data, but they do open up some major new possibilities. In case you’re wondering, ParAccel’s TPC-H results were seven times faster and had 16 times better price / performance than the previous record, held by Oracle.

But pure scalability isn’t the key selling point for ParAccel. More than anything, the company stresses its ability to handle complex queries without specialized data schemas or indexes. This means that existing data structures can be loaded as is and queried immediately. The net result is a much faster “time to answer” than competitive systems, which do tailor schemas and/or indexes to specific questions. It also means that new queries can be answered immediately, without waiting for schema modifications or new indexes.

The 2.0 release extends these advantages with a new query optimizer that handles very complex joins and correlated subqueries; parallel data loading (nearly 9 TB per hour in the TPC-H benchmark) and User Defined Functions; enhanced compression; and “blended scans” that avoid Storage Area Network (SAN) controller bottlenecks by loading SAN data onto compute nodes and querying them directly. It also adds some special features such as Oracle SQL support and column encryption for financial data. Another set of enhancements are designed to provide enterprise-class reliability, availability and manageability, such as back-up and failover. Several of these features are already in production, although the official 2.0 release date is August.

The new release and added funding mark a transition of ParAccel from quiet introduction to full-throated selling. Over the past year, the company has carefully limited its participation in Proof of Concept (POC) competitions, the key selection tool in this segment. This gave it time to refine its POC processes, add system features, and build initial client references. It says it can now complete a typical POC in three days, often leaving while other vendors are still getting started. The company is now ramping up its lead generation and inside sales operations, aiming to grow quickly beyond its dozen-plus existing installations. (To provide some context: Vertica reports more than 100 clients.) We'll see what comes next.


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* For some serious doubt-sowing about the new benchmarks, see Daniel Abadi's post (be sure to read the comments) and ParAccel's response. What really matters, as ParAccel points out, is performance in customer POCs. The company says its performance has never been beaten, although there was one tie. (For sheer entertainment, check out the related string on Curt Monash's blog.)

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Lyzasoft White Paper Looks at Coordinating Business Analysts and IT

Summary: a new white paper says business analysts gather data with little help from IT. I'm not so sure, but agree that collaboration tools like Lyza Commons can help both groups cooperate.

Analytical software vendor Lyzasoft has just published a white paper by data warehouse guru Dr. Barry Devlin on how business analysts and IT can work together. (Click to download Collaborative Analytics: Sharing and Harvesting Analytic Insights across the Business.) Since I’ve spent much time pondering this very issue, I was quite curious to see his perspective.

The paper describes a fundamental contrast between a “center out” model of data usage favored by IT (carefully and centrally controlled) and an “edge based” model favored by business analysts, who act as independent data “hunter-gatherers” to combine and use data in ways that the central resources are not designed to support. Devlin's term for this is “emergent prototyping”, a trial-and-error process of reworking an analysis until it produces something useful.

He also suggests that analysts work first by themselves, and then, if they find something interesting, share it with other analysts. Only later, when something seems really important and reusable, will they try to get corporate IT to add it to the central systems.

My own mental model is slightly different. I see analysts as spending very little time gathering data. In practice, most of what they need resides in corporate systems, so analysts are largely at the mercy of IT to provide extracts of required sources. Although waiting for those extracts is probably the biggest constraint on what analysts can accomplish, they don't spend that time twiddling their thumbs. Most of their work day (apart from meetings, etc.) is spent manipulating and interpreting data, and, as Devlin suggests, discussing results with other analysts.

This difference in perspective has some impact on judging what matters in a business analysis tool. If data gathering is really important, then features for extraction and consolidation are critical. If manipulation and interpretation matter most, then features for processing and visualization are at the top of the list.

As I recall, Lyza doesn’t offer particularly advanced extraction or consolidation features (e.g. fuzzy matching), so this isn’t necessarily a topic they should stress. Lyzasoft might disagree – and I’ll gladly concede that the system allows basic joins and filters that are well beyond what you can do in Excel. Still, to my mind, the real strength of Lyza is the ability to create data process flows, which save analysts from trying to do similar work by manually modifying Excel spreadsheets. (Click to read my Lyza review.)

Either way, though, features to document and share analytical processes still matter. Those are really the focus of this white paper, which is written to support the "Lyza Commons” product. Commons lets analysts share their work, trace the origins of each shared item, and use one analysis as input to another. As the paper points out, this both fosters cooperation among analysts and makes it easier for IT to add their activities to the company’s core business intelligence systems. Both benefits should free up analysts’ time for new projects, letting them foxus on what they do best.

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Demand Generation Vendor Traffic Rankings

Summary: Based on Web traffic rankings, new demand generation vendors with low prices are gaining market presence. Pardot and (perhaps) Genius.com look particularly strong. But Eloqua, Silverpop and Marketo remain industry leaders.

Last November, after much consideration of alternatives, I settled on Alexa three-month Web traffic rankings as a reasonable way to measure the relative market presence of demand generation vendors. You can see that post here. I revisited that data today, adding a few new vendors and dropping some of the very minor ones. Results are in the following table.

(Note: after I posted this, it was pointed out to me that the bulk of traffic on several sites relates to customer log-ins rather than marketing prospects. For example, Alexa says that 89.4% of visitors to eloqua.com next go to now.eloqua.com, which is the domain for client landing pages and user log-in. I don't know whether this particular nuance makes the Alexa rankings a less useful indicator of market presence, but it probably means the figures relate more to existing customers than prospects. Alexa is a crude measure for many reasons -- although I do think the rankings correlate roughly with a vendor's volume of business and marketing actvitiy, I wouldn't go much further. - David)

There are no huge surprises. The leaders among demand generation systems are still Eloqua, Silverpop and Marketo. Infusionsoft and Genius.com also rank very highly, but they serve broader markets (small business and salespeople, respectively) so a direct comparison with pure-play demand generation vendors may not be appropriate. Silverpop's figures may also be inflated by its consumer email production business.

Vendors showing significant growth (highlighted in green) are mostly new entrants with below-average prices: Pardot, OfficeAutoPilot and LoopFuse. ActiveConversion is not new but also has a low price point. The outlier here is eTrigue, a long-established player that I've never looked at in depth. Their ranking is still very low, but has increased substantially. Judging from the press releases on their Web site, this may be due to a new release last October that added Salesforce.com integration. I'll explore further when time permits.

The only vendor with a really major drop in ranking was Lead Genesys, another long-time industry participant.

As the entries in the first column indicate, I've reviewed nearly all these vendors in either this blog or the Raab Guide to Demand Generation Systems. (The links all point to blog entries.) The only important exception is LoopFuse, which I have deferred at the company's request. (How about it guys? Ready yet?) NurtureHQ doesn't quite seem to be a full-scale demand generation system, insofar as it seems to lack landing pages. But its relatively high rank still surprised me, so I'll make it a priority to learn more.

My general interpretation of these numbers is that demand generation remains a dynamic market -- new participants can still enter successfully if their product and pricing are attractive enough. This is good news for marketers, since continued competition will result in continued product improvements. Major advances are still needed in usability, particularly for complex marketing programs, and in coordination with sales systems. Vendors who can deliver on these key requirements at reasonable price points should earn their place as tomorrow's industry leaders.

reviewed in:	vendor:	Alexa rank: November 2008	Alexa rank: July 2009
blog	Infusionsoft		4,993
guide	Eloqua	20,234	10,036
guide	Silverpop / Vtrenz	29,080	28,640
guide	Marketo	68,088	51,463
blog	Genius.com		70,007
blog	Pardot	211,309	92,530
blog	OfficeAutoPilot	509,868	153,232
guide	Marketbright	167,306	180,141
blog	ActiveConversion	257,058	192,634
guide	Manticore Technology	213,546	203,501
blog	Marqui Software	211,767	265,780
guide	Market2Lead	235,244	296,914
blog	Act-On Software		344,806
	LoopFuse	734,098	353,994
	NurtureHQ		367,152
blog	Treehouse Interactive		419,315
guide	Neolane	566,977	537,863
blog	LeadLife		677,156
	eTrigue	1,510,207	728,720
blog	SalesFusion360		846,961
	Lead Genesys	557,199	1,015,851
blog	True Influence		1,246,454
blog	RightOnInteractive 5Buckets		1,342,985

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