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Each issue of CMO Close-up features an interview with a CMO, as well as other marketing executives answering that issue's "Big Question."
This week's feature:
Close-up with Laura Howard, CMO, ECI Telecom
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Coremetrics tool targets smaller marketers
Rich Karpinksi
Story posted: September 10, 2007 - 12:15 pm EDT
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Web analytics vendor Coremetrics is taking its high-end tools to small and midsize businesses.
The vendor, best known for delivering sophisticated analytics tools to large enterprise users, is going down-market to compete with low-cost or—in the case of Google Analytics—no-cost competitors.
The vendor hopes that by offering its Coremetrics SMB Solutions as a service—priced for a typical installation at about $1,000 per month—it will be able to entice small businesses that need a thorough analysis of how their Web sites are performing. And that means not just page views but more in-depth analysis such as e-commerce or other action-driven conversions, said John Squire, Coremetrics' senior VP-product management.
"For small businesses, it's not about volume," said Squire, adding that while many large companies are content to measure large numbers—the online equivalents of foot traffic or mass circulation—smaller companies "are extremely nimble and understand their customers extremely well. Once they start analyzing the data they really zero in on the most interesting aspects of customer behavior and are willing to change their business on a dime to address those needs."
Most lower-cost, log-based analysis packages, however, don't offer that level of detail, Squire said. For instance, many companies need to manage and categorize a large number of product SKUs or a wide array of Web site content. In addition, while analytics packages such as Google Analytics do a good job with basic Web site and search analysis, they can't take into account other vehicles such as e-mail or affiliate campaigns, Squire said.
Coremetrics' tools also operate in real-time rather than as an after-the-fact log batch process, enabling small companies to react quickly to Web site activities. "Small-business people can literally sit on the site, and watch a new campaign, and see what is working and what isn't, and respond immediately," Squire said.
B&H Photo-Video had been using a log analysis tool for its Web analytics, but CIO Herschel Jacobowitz said the company "wasn't getting the data we needed from the tool."
B&H not only feels more comfortable with Coremetrics' data collection capabilities but is using the additional analytical capabilities to push the tool "to the center of our CRM [efforts] to understand how visitors interact with the B&H Web site over the lifetime of the customer," Jacobowitz said.
Templates help at start
To meet the needs of smaller companies, Coremetrics SMB Solutions include industry templates and other implementation tools to get users up and running. Customizable dashboards let them set the tool to provide the marketing answers and directions they need.
According to Squire, Web analytics software at small businesses is typically run by the owner or CEO, as they are closest to the customer. If the business is large enough to have a marketing head, they typically work closely with the CEO to get the most out of the tool, he said.
Analysts said Coremetrics is one of the last Web analytics vendors to target the SMB market, but given its relatively high-end features that's not surprising. By dropping its price and playing up its strong prepackaged reports and services capabilities, the vendor should appeal to sophisticated smaller users, analysts said.
"It's becoming a very competitive market, and the differentiation between products is subtle," said Gartner Inc. analyst Bill Gassman. "It comes down to services. That's where a lot of these vendors make their money, on the consulting side with engagements for $5,000 or $10,000 helping to get people pointed in the right direction [with Web analytics]."
For larger enterprises, the rule of thumb is that once you are making 5% or more of your revenue online, you need to start using Web analytics, Gassman said. For smaller companies, given the smaller numbers involved, that percentage might be a bit higher but not much, he said.
However, at a starting point of $1,000 per month for the Coremetrics' SMB service, a company "better be making a couple of hundred thousand dollars per year on their Web site for it to make sense," he said.
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