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www.ecommerce-guide.com/solutions/design/article.php/3440351
By James Maguire November 24, 2004 Continued from Page One.
Analyzing Analytics Vendors Peterson forecasts that 2005 will be a year of stability and growth for Web analytics vendors. The early years of e-commerce saw wild turbulence in the analytics market, and certainly these vendors still face volatility, but it will start to subside. Contributing to this move toward stability is the fact that many large merchants will stop hunting for a new analytics vendor. Among companies that spend in excess of $50,000 on analytics, 52 percent will "definitely not" buy a new package in 2005, and another 32 percent say "maybe," to buying new software next year, according to JupiterMedia. Among companies that spend between 10-50k on analytics, 35 percent will "definitely not" buy a new package, and 31 percent say "maybe." In this same segment, 19 percent say "definitely yes" to buying a new package next year. What this means for vendors, Peterson says, is that analytics firms that sell higher-priced packages "are going to be able to step back and not fight the fires of customer defection, and instead focus on improving the overall quality of their application." And this process of regrouping appears to be necessary. Many online merchants are far from enamored with their current analytics packages. A common complaint among e-tailers who buy "hosted" analytics packages - Web-based programs that charge a monthly fee - is service outages. That is, the program is still collecting data but the user interface is down; or, there's some odd data change; or the viewer is slow. In some cases, vendors fail to alert users before a service problem, causing great user frustration. Some executives at online businesses complain that today's analytics packages are not providing the level of accuracy they expect. The reasons for this inaccuracy are numerous: log files are full of requests from search engine spiders, shoppers use front and back buttons, interpreting proxy caching causes problems, and other technical snafus. Some analytic packages cannot handle a sudden flood of data, like those caused by a dramatic uptick in users following a major news or product event. Analytics vendors respond to complaints about inaccuracy, Peterson notes, by saying "it's hard to be completely accurate because it's the Internet, which is an inherently inaccurate medium." These vendors instead encourage their customers to focus on trends rather than precise data. But, Peterson notes, "you wouldn't accept that from your sales force automation system or your bank - why accept it from your analytics system?" In fact, when executives were asked what their most important criterion was for selecting an analytics package, 69 percent said "accuracy of information," according to Jupitermedia research. "I would be very surprised to talk to someone who says 'we've been using this application for a year and we've never felt that there are inaccuracy issues," Peterson says. As thorny as these technical issues are, he forecasts that vendors will address and solve them. "We see the vendors - they've all expressed this - looking back at these issues of accuracy throughout 2005, with hopefully some resolution by early 2006."
Getting the Best Deal Vendors realize that the competitive marketplace means they are "challenged with having to consistently delight customers with high quality support, innovative offerings, and training," Peterson says. "It's such a competitive market, if you're willing to ignore your customer, you're willing to lose that customer." Because of the competition between vendors, if an e-tailer shops hard, he or she could find not only the best price on a given package, but even 10 to 15 percent less. One possible technique: "play that competitive card late in the deal," Peterson notes. "If you go back late in the game and say, 'I just got a proposal from your competitor that's 10 percent lower,' the vendor will probably lower the price." However, this strategy is not without risk, he notes, because some vendors will not go this low. The smart shopping strategy required to get the best price on an analytics package is not dissimilar to the strategies used in car shopping. "You can buy late in the quarter, late in the year," Peterson says, explaining that analytics salespeople may be pressed to make quotas then. "If you really want to get the bargain basement price, you always can."
Some Leading Vendors In particular, Omniture, [http://www.omniture.com] is an industry heavyweight. The company "has clearly established itself as a market leader in 2004," Peterson says, noting that this year they have won AOL's business. Other market leaders are Coremetrics [http://www.coremetrics.com], which makes a package Peterson indicates is geared for retail, financial services and travel sites; and WebSideStory, [http://www.websidestory.com] whose name is included in most all requests for proposals, and which received a substantial cash infusion after going public this fall. He points to WebTrends as "among the founding fathers" of analytics. [http://www.netiq.com/webtrends/default.asp] Peterson, who once worked for the company, recalls a time when the phone rang constantly with businesses calling to buy the application. While that has slowed down somewhat, he says, the WebTrends 7 application offers a good refresh on its interface. Most importantly, WebTrends, "has a strong organization and has made a commitment to supporting its customers." Generally seen as one of the more intuitive Web analytics applications, ClickTracks 5.0 [http://www.clicktracks.com/] is available as both a hosted product and a server-based one. Significant in its newest version, which shipped last spring, is the What's Changed Report. When you log onto ClickTracks, it searches for what it considers unusual shifts in the numbers of visitors, search queries, referrers, campaigns, entry pages, visited pages, and countries of origin since your last visit. An analytics vendor that is not as well-known in the industry but that offers a quality product is Visual Sciences. [http://www.visualsciences.com]. "They basically took the mold for the analytics package, threw it away and rebuilt it from scratch," Peterson says. "And they've done an amazing job - it's a very strong data analysis engine, with an innovative reporting interface." James Maguire is a contributor to ECommerce-Guide.com. His column appears every Friday.
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