ClickSquared System Combines Marketing Database, Campaign Management and Multi-Channel Message Delivery

Summary: ClickSquared is marketing services agency that, unlike most of its peers, has built its own marketing automation system. The main advantage is tight integration of database build, campaign management and message delivery. The vendor has just officially launched its system, which should meet the needs of most mid-tier consumer marketers.

In a post last week, I casually described ClickSquared as a vendor delivering multi-channel messages for external campaign management systems. This was not wholly accurate. Although integrated multi-channel delivery is indeed a key differentiator for ClickSquared, the firm also offers its own campaign management system, called “Click 3G”. In fact, Click 3G was officially launched last week, although the company has been migrating clients to the platform since Fall 2008.

The more important clarification is that ClickSquared is a marketing services agency, offering database management, campaign development, creative, execution and analysis. The company got its start in 1999 as a direct mail house specializing in overnight execution of trigger marketing programs. Since then it has added email and other services through acquisitions and internal expansion. It now offers a relationships relationships ranging from full-service to self-service, with a particular focus on full-service solutions for mid-tier businesses and on special programs for very large enterprises. It sends emails for about 85% of its 150 clients and maintains marketing databases for about half of them.

In other words, ClickSquared competes with firms like Epsilon, Merkle and Acxiom for enterprise clients, and with a host of smaller firms for mid-tier clients. It also competes to some degree with email providers like Responsys, ExactTarget and InfoGroup YesMail, which are themselves expanding into other channels. (Apologies to all for over-simplification. Properly identifying the overlapping spheres of industry competitors would take a post of its own.)

One feature that stands out about ClickSquared is its choice to build its own campaign management system. This contrasts with the vast majority of marketing services agencies, which rely on industry-standard products such as Unica and Alterian. The fundamental argument for using industry-standard software is that continuously updating a home-grown system costs too much for most marketing services vendors, who can’t spread the expense across as many clients as a dedicated software company. Nor is software development a core competency of many marketing services agencies. Ultimately, this line of reasoning concludes, marketing services agencies compete on database management, analytics, marketing strategy and client service, so software is a poor investment for their necessarily limited resources.

To put matters in historical perspective, most big marketing services agencies did create their own campaign management systems when the category first developed in the 1990’s. But once satisfactory third-party products became widely available, the big firms largely dropped their in-house products. So it’s intriguing that ClickSquared (and a few other firms including Entiera , which I reviewed last July) have again chosen to build their own.

It’s much too soon to consider this a trend, but perhaps the cost/value relationship has shifted back in favor of in-house systems. The logic would be something like this: the prices of commercial systems haven't change, while the cost of building in-house systems has fallen because the requirements are well understood and developers can take advantage of third-party components and agile development methods. Thus, in-house development is relatively more attractive.

But in talking with ClickSquared (and Entiera, for that matter), I hear slightly a different story. It’s true that they avoid hefty license fees by using their own software. But main savings seems to come from integrating several capabilities, including customer data integration, message delivery and reporting, in addition to campaign management itself. This reduces both the total software cost and the labor needed to combine the separate systems. For example, ClickSquared says it can deliver a new marketing database in one to three months, compared with six months or more using third party systems.

Of course, an in-house system must still meet business needs for the savings to be worthwhile. Part of the reason that ClickSquared targets Click 3G at mid-tier companies is that their needs are somewhat less complex than enterprise marketers. That said, the system offers a respectable set of capabilities.

- Customer data can be loaded via API posts or self-service file uploads. The system provides automated data cleansing and customer matching capabilities. It can also gather data with an advanced email survey tool that supports for dynamic questions (i.e., questions change based on previous responses) and complex question types such as rankings and allocations. Marketing content can be uploaded and edited within the system and then shared across campaigns.

- Analytics are largely handled outside the system. These is no built-in predictive modeling, although scores can be imported and used as variables into segment definitions and business rules. The system does provide its own Web analytics module, or it can import data from Omniture or Coremetrics. ClickSquared captures online response using standard link tracking and can generate heat map reports showing how often different links were clicked within an email or Web form. Users can execute custom attribution rules during their database build.

- Campaigns are based on business rules. These can be executed in batch or triggered by events posted to the system API in real time. The rules can consider file segmentation, offer selection, channel preferences and limits on contact frequency when selecting messages. Click 3G also supports “distributed marketing” campaigns that allow users such as branch offices to execute predefined programs by setting a limited number of parameters. Campaign outputs can include dynamically-customized content for direct mail, email, and mobile (SMS) messages, as well as messages sent to CRM systems via an API.

- Message delivery for email is handled directly by ClickSquared, which helps to manage ISP relationships, ensures compliance with anti-spam regulations, and can spread large blasts over time. The system provides similar services for wireless (SMS) messages, although (like most marketing service vendors) it works with a third party to integrate with carriers. For direct mail, ClickSquared can handle preprocessing such as NCOA and then deliver a file of printer-ready personalized PDFs. Although campaign manager-to-email integration is more common today than when ClickSquared began, its multi-channel integration is still an advantage.

- The system also provides several “Web 2.0” options. Most notable is “clickShare”, which lets users register and then upload, share and comment on materials in an online forum. Other applications support referrals, mapping mash-ups and product ratings. Activities in these applications are fed into the marketing database, where they can be used for segmentation and triggers.

Click 3G lacks some refinements of the main commercial campaign management products, such as embedded predictive modeling and detailed project management. The vendor argues that its mid-tier clients don’t necessarily need such features, or at least need them less than tightly integrated database building and message delivery. Click 3G’s largest installations are currently in 15 to 20 million customer range, firmly within mid-tier territory.

Pricing for ClickSquared is based on the combination of professional and technical services used by each client. For Click 3G, factors include database size, channels used, message volume and system modules. A self-service client with 50,000 customers and 100,000 emails per month would pay $1,500 per month for the system. A client with two million customers and a proportionate mix of email, direct mail, text messages, surveys and social content would pay $15,000 per month. Clients commit to a contract of one year or longer.