Tuesday, April 15, 2008

Free to Be...You and Me

It just keeps getting better. Today, Dennis Mortensen of IndexTools announced that Yahoo! will be offering the Web analytics services for FREE. There’s an agreement that will go out to existing partners and clients regarding the change in service level, but they will have exclusive access while Yahoo! prepares for the next rollout.

For those of you who recall 1970’s pop culture, one of my favorite Free to Be…You and Me skits involved the voices of Marlo Thomas and Mel Brooks as two bald babies trying to figure out their identities. Well, it didn’t take long for the babies to figure out who they were and apparently “Yahoo! Tools” didn’t spend much time deliberating either. The new alliance will threaten Google Analytics’ substantial market share as the current free tool on the market – AND – challenge commercial analytics offerings from larger vendors such as Omniture, WebTrends and Coremetrics.

I am truly excited to be engulfed in JupiterResearch’s 2008 Web Analytics Constellation report. IndexTools agreed to participate in this year’s review back in February, providing me the opportunity to assess the marketplace of free and commercial analytics tools on a level playing field. The completed study is scheduled to publish this summer and will include an evaluation of the following vendors: Coremetrics, Google Analytics, IndexTools, Lyris HQ ClickTracks, Nedstat, Omniture, Unica, WebTrends and WebAbacus.

This is an exciting time for Web analytics and I welcome your comments or questions about the direction of our evolving marketplace.

Wednesday, April 9, 2008

Yahoo! Analytics

I received a short note in my inbox this morning from Dennis Mortensen, COO of IndexTools. We spoke last week about the solution capabilities, flexibility and future direction of the product, but he must have been grinning all the while. Today he provided a link to his blog announcing that IndexTools would be acquired by Yahoo! Just a small tidbit of juicy information, I’d say.

The financials of the deal were not disclosed, but the bigger question burning up the analytics blogosphere is; What does this acquisition mean to the Web analytics world? First, the IndexTools solution is a robust analytics platform that has been build from the ground up for flexibility and sheer analysis horsepower. Dennis describes the beauty of the tool by stating that it offers less canned analysis, which in turn requires analysts to think more about their data, facilitating discovery. Many argue that IndexTools v9.0 rivals Omniture’s SiteCatalyst at a fraction of the cost. And speculation abounds regarding how Yahoo! will bring this tool to market. My guess is that Y! will devise a “Freemium” solution, where some functionality is offered to small and mid-sized businesses at no cost and incremental services (like the v10.0 Rubix visualization tool) will be available at a premium.


News of this pending deal will undoubtedly attract the attention of free analytics providers, Google Analytics and Microsoft’s AdCenter. But rather than attempting to undercut their market share by providing yet another free tool for widespread usage, Y!’s Michael Wexler, unofficially states that they’re approaching the market from a different angle. The goal, he describes, is to enable users of Yahoo! products, (development, advertiser, shopping, and end user products) to analyze usage data in a comprehensive way to derive optimal use. He goes on to compliment Google Analytics’ success as a basic tool, but criticizes that it’s not designed for people that “really want to understand their data, nor is it aimed at the variety of ways people can work with Google (it ignores all that API stuff, for example).” Wexler views IndexTools as “the foundational start to understanding not just marketing and its impact on site behavior, but how to understand you online site usage to achieve your goals…”

Ahh, look out Omniture, eh? Despite the indication that Y! is not going after the free market, if this solution is available to any part of the market for free, it will undercut the market share of Google Analytics and MS AdCenter. However, it will not displace the need for enterprise solutions like Omniture, Coremetrics and WebTrends. These companies are building out their marketing optimization platforms, with a key focus on integration. Without buying into the vendor hype about “optimization”, the industry leaders have demonstrated that Web analytics can reside at the center of data analysis for marketing functions. Y! statements from Wexler (although unofficial), make it sound like they may be eyeing the integration component, if only for it’s own services. Other vendors in the marketplace will be forced to keep up in a Web analytics feature arms race or be absorbed and rolled into larger enterprise marketing solutions. But, we’re already seeing this with tools like ClickTracks as integrated solutions within Lyris’ entire marketing suite. And Unica has taken a similar approach by integrating NetInsight analytics with its other enterprise marketing products. The Web analytics industry is evolving, but that does not spell the demise of stand-alone enterprise analytics.

Market Impact
Despite my respect for Eric Peterson, I’m inclined to disagree with his take on the pending acquisition. I do not believe that this will be a “permanent game changer” for Web analytics. Disruptive, yes – but permanently altering no. [For the sake of brevity I’m purposefully ignoring the MS/Yahoo! option.] In the free tool scenario, there’s no historic precedent (with the exception of some general open source examples: e.g., apache, MYSQL, etc) that free tools will displace commercial vendor analytics solutions. If anything, free tools will continue to be utilized concurrently with commercial alternatives for trend verification and specialized uses. Yahoo’s Wexler even confirmed this with his statement about using IndexTools to gain greater perspective on Yahoo! products. There’s nothing to indicate that a Fortune 1000 enterprise would abandon their paid vendor analytics relationship for free tools on the marketplace. If Y! decides not to make the IndexTools solution available for free, then they will certainly make a run at the larger players in the market. But competition is good for all of us and it won’t be anything we haven’t seen before.

I do believe that the availability of free or “Freemium” tools places pressure on existing analytics companies to raise the bar on functionality, usability and actionability of their data. While the free tools will help to spread the ubiquity of analytics data, the ability to correlate, analyze and take action on it will continue to be a driving factor. Here, I agree with Eric that the GAAC (Google's consultant network) will serve to perform this analysis and provides a stellar prospect list for Yahoo! Analytics, but IndexTools already works with over 200 agencies globally to analyze data and take action on it. If anything, the increase of free tools will amplify the opportunity for the prosperous analytics consulting industry and provide plenty of work for all.

In the end, I believe that the impact of this acquisition on the analytics industry will play out as follows:

    ~ Greater awareness and utilization of web analytics worldwide
    ~ Higher expectations placed on enterprise players to innovate and deliver
    ~ Further expansion of ancillary marketing tools as core capabilities offered by existing enterprise analytics vendors

These are exciting times for the Web analytics industry. Lots of changes…lots of controversy…and lots to talk about. My sincere congratulations go out to Dennis and his team at IndexTools, as well as to the beneficiaries at Yahoo!. I believe that this acquisition is a testament to the capabilities of the IndexTools solution and I for one am extremely excited to see how this one plays out.

Friday, April 4, 2008

If I were holding the checkbook...

I’m no equity analyst, nor do I want to play one on TV…so I’ll speculate on what I think Coremetrics should do with their new $60M in series E funding. (If you want the equity take, here’s a post from the Deal.com.)

Shout from the Rooftops
Coremetrics maintains widespread notoriety among analytics pros, yet there’s a big wide Web out there just entering the shallow end of the analytics pool. Coremetrics should invest in marketing programs to increase awareness and position themselves as the next step in Web analytics solutions.

Take on the Jolly Green Giant
While the green glow of Omniture will be tough to shadow, competition is good for everyone. Omniture has been the Web analytics powerhouse of 2007, but if anyone has the chops to make a run at them – Coremetrics is poised to do so. As a smaller and potentially nimbler organization, Coremetrics has a chance to shine on service, support and [retail] vertical expertise.

Shopping Spree

Well, not really a spree since $60M ain’t what it used to be, but perhaps an acquisition. Adding multivariate testing capabilities or fortifying their search marketing solutions wouldn’t hurt. Coremetrics has been successful at creating tools for the marketer and should look to acquire technologies that make it increasingly easy to execute on strategic functions without technical intervention. The greatest opportunities may be around optimizing search and ad spending.

Continued Commitment to Development
Glimpses of the Coremetrics’ 2008 roadmap foreshadow significant improvements. Enabling the data to work for their clients by providing greater access and visualization is a priority, but embracing the reality of increased consumer control is a necessity. Social networks, UGC and the voice of the customer are creating a cacophony of insight. Someone needs to figure out how to make sense of it all and convert data into action.

Tuesday, April 1, 2008

Good One Google

Anyone else do a double take as they logged into a Gmail account today? They spoofed Gmail “Custom Time” allowing users to change the time of sent emails to delude recipients of the fact that you’re actually late on e-mailings. Gmail uses an e-flux capacitor to make the whole thing work. The purported functionality even makes it appear that the recipient opened the email placing fault into their hands. Brilliant! My deliverables are no longer past due!

Beta User Testimonials…

"The entire concept of 'late' no longer exists for me. That's pretty cool. Thanks Gmail!" Miriam S., Delivery girl

"I used to be an honest person; but now I don't have to be. It's just so much easier this way. I've gained a lot of productivity by not having to think about doing the 'right' thing." Todd J., Investment Banker

Nice one Google, you had me for a second there...