mark r. madsen third nature may 26,...

Mark R. Madsen

Third Nature

May 26, 2010

Online Customer Analytics

and Beyond:

More Than Just Web Analytics

2

Sponsors:

3

Speakers

Mark R. Madsen

President,

Third Nature

Bob Zurek

CTO and VP, Product

Management,

Infobright

Andrew Lampitt

Senior Director of

Business Development,

Jaspersoft

On-Line Customer Analytics and

Beyond: More than Just Web

AnalyticsMay 26, 2010

Mark R. Madsen

www.ThirdNature.net

Twitter: http://twitter.com/markmadsen

Flickr: http://www.flickr.com/photos/madsen/

LinkedIn: http://www.linkedin.com/in/markmadsen

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Intelligent Enterprise: http://intelligent-

enterprise.informationweek.com/movabletype/blog/mm

adsen.html/blog/

http://twitter.com/markmadsen

http://www.flickr.com/photos/madsen/

http://www.linkedin.com/in/markmadsen

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The business world is The world is changing

Always available

Always-on

Interactivity

Channel multiplication

Fragmentation

How organizations and individuals interact is changing, becoming more direct.

Mark R. Madsenwww.ThirdNature.net

Accountability Has Been a Problem

Marketing

accountability

and oversight is

big now because

of a few things:

• Big budgets and a

need for cuts

• Lack of visibility

• Difficult attribution

• Direct process

measurement is

now possible


Marketing Has Relatively Few Outcome Metrics

1.Input: measures the upfront part of a process like cost

how much you spent on a TV spot during the super bowl

2.Process: measures the process but not the effect

reach of that super bowl ad

3.Outcome: measures the results

lift from the super bowl ad

Harder things to measure: direct linkages, consumer

sentiment, brand awareness, brand strength, brand equity

?1 2 3


Promotion

Product

Channel

Pricing

• Awareness

• Interest

• Consideration

• Action

• Satisfaction

What Marketing Tries to Manage and Measure

This is the simplistic unidirectional view.

Individual prospect/customer states What marketing controls


Promotion

Product

Channel

Pricing

• Awareness

• Interest

• Consideration

• Action

• Satisfaction

Feedback loops complicate the picture

Service

Word of mouth

Sales


The (mass) Marketing Process

This is designed for a mass market where you create a few

to dozens of stable segments, with hundreds of thousands

of members or more in each.

Analyze and segment the

market and/or customers*Create offer

Execute

campaign

Record

results

Feedback

*or not


Hard because measuring results is hard

?

The assumption is this:

What happens in the

middle is largely a mystery

because of the nature of

mass communication and

transaction channels.

Mass marketing treats people similarly, but with slightly more

refinement owing to segments associated with channels.


Bad News if You Want to Buy Advertising

Number of prime-time 60 second

TV commercials required to reach

80% of 18-49 year-olds

• In 1965: 3

• In 2002: 117

People with DVRs watch 12%

more TV

Yet 90% of them skip the ads


Marketing Spend is Shifting in Response


Challenge: Now Everyone is a Direct Marketer


Direct Marketing is Not Mass Marketing

Responses differ, so craft offers for segment-specific goals.

More offers, segments, faster feedback, constant resegmenting.

Many segments, and most

often derived from behavior.

Individuals uniquely identified.

Create

customized

offers

Execute

campaign

Record

results

Feedback


Better but more complex result measurement

?

The assumption in direct

marketing is this:

There is more visibility

into which campaigns

best lead to actions

and which customers

are best* but still a

visibility gap.

Direct marketers still treat people similarly, but with more

refinement owing to direct response visibility.

?

?


The Obligatory Marketing Funnel Diagram

You want to extend your

picture of the customer to both

earlier and later in the process

than just the transaction.

Define goals and metrics for

use in each stage.

Determine what marks

transitions from one state to

another and track those.

Audience

Prospect

Opportunity

Lead

Customer

Proponent


Funnel ProblemsThe funnel view is a one-way flow that applies only

to feeding an organization’s new customer demand.


The Funnel Concept is Too Narrow

It ignores non-transactional marketing campaigns.

After spending money to acquire a customer, attention

must be paid to service aspects of the relationship, and

as noted before, there are multiple feedback loops.

Marketing analysis for brand

campaigns and customer acquisition.

Analysis for customer retention and

lifecycle management.

Au

die

nc

e

Pro

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t

Op

po

rtu

nit

y

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ad

Cu

sto

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r

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nt

Many events occur after acquisition.


It’s a Multi-Channel World

There isn’t one

funnel, there are

many funnels,

which combine to

form the big picture.

Each of these new

channels has

measurement data

coming from

different sources,

often external and

out of your control.


Marketing Measurement = Channel Measurement

Communication channels are not transaction channels. One

drives people to the other.

• Measuring communication channels is about the communication

process and the expected outcomes in transaction channels.

• Measuring transaction channels is about the performance and

processes of those channels.

The funnel concept is actually many funnels, not just one.

Online

Print

Radio

TV

Online

Location

Phone

Campaigns can cross

communication channels.

TX channels overlap and

cannibalize each other.


Multichannel Challenges

You can calculate the same core metrics for online

channels as for direct marketing or advertising.

The hard part is knowing what to do with which channel.

e.g. same cost, same reach:

• Which is more effective?

• For which customer segments?

• How do they reinforce?

?12 3

?


High Level View of Some Common Channels

Communication Channels

Radio

TV

Print

Online

Display ads

SEM

SEO

Affiliate

Email

Site

Mobile

Games

Each of these has individual metrics, some of

which are standardized in the traditional

channels but only for some online.


You Get Much of This Data Via Web Analytics

1. Who came, where they

came from and how they

found you

2. What they did while they

were there

3. Whether they were able to

do what they / you wanted

on your site

But web analytics has some

limitations…


All Your Data Are Belong to Us


Web Analytics and DW Limitations

Web analytics data lacks key financial and customer

interaction or service information, and is only one channel.

It’s downstream from some activities, upstream to others.

The DW usually contains data post-acquisition but not

upstream in the process or non-transactional data.

BI / DWWeb analytics


What Marketers (and Organizations) Need

Individual, cross-channel, lifetime history: 360o


Evolution of the Customer Master

Demographic

• Your customer master

• Geography

• Group memberships

• Social network profiles

• Syndicated data

Psychographic

• Clickstream (visits, views, timing)

• Communications

• Content (blogs, tweets, comments, ratings)

• Transactions

• Syndicated data

Socialgraphic

• Profiles of connections

• Connection likes and dislikes

• Syndicated data

The detail and breadth expand as collection improves


Customer Data is Functionally Aligned

Each function has specific applications and processes,

usually supported by local reporting and BI.

Sales automation

Audience

Prospect

Opportunity

Lead

Customer

Proponent

Customer master

Marketing automation

Call center automation

Sales BI

Marketing BI

Call center BI

Unifying customer information and contact processes

was something CRM was supposed to do for us.


Unifying Customer Data is Challenging

Observations of behavior like web

analytics and mobile analytics

generate far more data than

transactions do.

There is a need to centralize data

often distributed across departments.

Complexity of the data, models and

integration is much higher.

Analysis is at the detailed customer

level, rather than at aggregate level.

Data latency needs are lower.

More interactive analysis


Marketing bought from service firms for mass

media. Fine with few channels. Bad with many.


Two Things Marketing Analysts Don’t Want

Data integration and BI projects

that take months to deliver for

campaigns that may be one-time

and done in weeks.

Least-common denominator

financial data with individual

customer interaction

information stripped away, and

lacking multi-channel visibility.


Different Data and Usage Patterns

Be prepared for changed

assumptions:

• Marketing campaigns and

tactics change frequently,

particularly online marketing.

• This means data sources

change frequently, as well

as reporting needs.

• Much of marketing is like

experimental science, and

unlike the read-only BI

usage model.


The Online Channel Has Advantages

The online channel can provide realtime feedback

where old marketing channels sometimes have a

data lag of months.

Messages and offers can be

tested while a campaign is

running, rather than between

campaigns.

This requires that you collect

the data to manage the

process.


KTHXBAI!


Creative Commons Image AttributionsThanks to the people who supplied the creative commons licensed images used in this presentation:

old man union square selling.jpg - http://flickr.com/photos/ktb/4683842/

tiny_model_people.jpg - http://flickr.com/photos/mansonliu/298440052/

sand_beach_tide2.jpg - http://www.flickr.com/photos/ccgd/100703045

man does something - http://flickr.com/photos/eklektikos/77801351

http://flickr.com/photos/ktb/4683842/

http://flickr.com/photos/mansonliu/298440052/

http://www.flickr.com/photos/ccgd/100703045

http://flickr.com/photos/eklektikos/77801351

Infobright Overview

Infobright is a high performance

analytic database

that delivers fast query

performance

against large volumes of data

with minimal IT effort

37

Bango’s Need Infobright’s Solution

• A leader in mobile billing and analytics

services utilizing a SaaS model

• Received a contract with a large

media provider 150 million rows per month

450GB per month on SQL Server

• SQL Server could not support

required query performance

• Needed a database that could

scale for much larger data sets

with fast query response

with fast implementation

and low maintenance

in a cost-effective solution

Reduced queries from minutes to seconds

Reduced size of one customer’s database

from 450 GB to 10 GB for one month of data

Mobile Customer Analytics: Bango

38

Query SQL Server Infobright

1 Month Report

(5MM events)11 min 10 secs

1 Month Report


Complex Filter


Retailers’s Need Infobright’s Solution

• Wanted to extract detailed web data from

Omniture to business analyst desktops for

sophisticated predictive analytics

• 40 million rows of data generated daily,

analysts wanted one year of history to be

stored

• Central, traditional database couldn’t meet

requirements:

• Queries were too slow

• Couldn’t load data fast enough

• Business analysts wanted new process

that bypassed central IT infrastructure

• Needed to be totally automated, from data

extraction to database load to daily updates

Implementing the new system, including

Infobright database implementation and

automated extraction and load process, was

completed in two weeks

Query and load performance is outstanding

>10:1 data compression so fits on analyst

desktops

Database requires no tuning or ongoing

administration by IT or analysts

In Phase 2, web data will be enhanced with

other customer and sales data

“Infobright is an excellent tool to manage large

amounts of static data. It is great to have

control of our own data, and this has become

an important tool for the analyst team.”

- Retailer’s business analyst

Global Retailer: Online Customer Behavior

39

What is Unique about Infobright?

Uses intelligence, not hardware, to drive query performance:

Creates information about the data upon load, automatically

Uses this to eliminate or reduce the need to access data to respond

to a query

The less data that needs to be accessed, the faster the response

What this means to you:

No need to pre-plan queries, create indexes or tune for

performance

Ad-hoc queries are as fast as anticipated queries, so users have

total flexibility

Queries that may take hours with other databases run in minutes;

queries that take minutes with other databases run in seconds

40

Infobright Technology

Smarter architecture Load data and go

No indexes or partitions to build and maintain

Knowledge Grid automatically updated as data packs are created or updated

Super-compact data foot-print can leverage off-the-shelf hardware

Data Packs – data stored in manageably sized, highly compressed data packs

Data compressed using algorithms tailored to data type

Knowledge Grid – statistics and metadata “describing” the super-compressed data

Column Orientation

41

Users Need

it Now

Cost Pressures

Point toward

Open Source

Database for Analytic Applications

When is Infobright a “Must Have”?

42

Infobright

Innovation First commercial open source analytic

database

Knowledge Grid provides significant advantage over other columnar databases

Fastest time-to-value, simplest administration

Cool Vendor in Data

Management and Integration

2009

Infobright: Economic

Data Warehouse

Choice

Partner of the Year 2009

Strong Momentum & Adoption Release 3.3 Generally Available

> 120 customers in 10 Countries

> 40 Partners on 6 continents

A vibrant open source community

> 1 million visitors

> 40,000 downloads

> 4,500 active community

participants43

Get Started

At infobright.org:

Download ICE (Infobright Community Edition)

Download an integrated virtual machine from infobright.org

ICE-Jaspersoft or ICE-Jaspersoft-Talend

Join the forums and learn from the experts!

At infobright.com

Download a white paper from the Resource library

Watch a product video

Download a free trial of Infobright Enterprise Edition, IEE

44

Company Overview

©2010 Jaspersoft Corporation. Proprietary and Confidential 45

► Creates the most widely used BI software in the world

► Company HQ in San Francisco, CA; approx. 90 employees worldwide

► European HQ in Dublin, Ireland

► Funded by leading venture capital / private equity firms and strategic partners:

Morgenthaler Ventures, DCM, Partech International, Scale Venture Partners, SAP Ventures,

Adams Street Partners & Red Hat

► Founding member of the Open Solutions Alliance and the Open Source Channel Alliance.

Also belong to Open Source for America and Open Source Solutions Institute (OSSI)

► Community leadership: ► 9.7M total product downloads (200,000 – 250,000 per month)

► More than 106,000 Registered Developers

►11,000+ commercial customers in 96 countries

5/24/2010

Commercial Success: Sample Customers


Software & Technology

Financial Services

Travel & Transportation

Manufacturing

Public Sector

Public Sector

http://www2.dupont.com/DuPont_Home/en_US/

http://www.sapias.com/index.php

JaspersoftOne Product, Any Deployment Method

47© 2010 JasperSoft Corporation. Proprietary and Confidential

Many OEMs

Customers Distribution Partner

Jaspersoft Product Advantages

• Reporting– Print-ready pixel perfect production

reports

– Web 2.0 drag & drop ad hoc query

and reporting

– Access to any data source: relational,

XML, Hibernate, EJB, POJO, custom

– Connect directly or via rich business

metadata layer

• Dashboards– Web 2.0 drag & drop dashboard

designer

– Live component-level refresh

– Mash-ups with external content


Jaspersoft Product Advantages

• Analysis– In-memory analysis directly in reports

– Standards-based and scalable ROLAP

– Web, Excel, mobile user interfaces

• Data Integration– Wide range of connectors & transforms

– Intuitive graphical user interface

– High performance generated code

– Activity Monitoring Console

• BI Suite– Modular, shared services

– SaaS-enabled / multi-tenancy

– Small-footprint, 100% pure Java

– Designed for integration / embedding

– Internationalized and localized

– Extensible and customizable source code


Jaspersoft BI Suite Architecture


Production

Reporting

End-User Ad

Hoc Query &

Reporting Dashboards Data Analysis / Exploration

Data Mart /

Warehouse / ODS

Operational RDBMS

or

POJO, EJB, XML,

Hibernate, MDX,

Custom

Advanced

Reporting

Customer Example: Major Retailer

• Challenge:– Tie information from the website and other corporate sources to understand

customers more deeply and thus improve website design / sales efficiency

• Sources:– Web site logs

– CRM, other systems

• Questions Answered:– Are the web site visitors the audience we are targeting?

– What percentage of visitors become repeat visitors? And customers?

– Which web banners or referrals drive qualified prospects?

– What percentage of web site visitors are purchasing in person?

– What are the demographics of web site visitors who have purchased our

products?


Thank You!

Web: www.jaspersoft.comwww.jasperforge.org

E-mail: [email protected]@jaspersoft.com

[email protected]

Phone: North America: +1 888.399.2199 or +1 415.348.2380

Europe, Middle-East, Africa: +353 1 443 4700

© 2009 Jaspersoft Corporation. Proprietary and Confidential 52

http://www.jaspersoft.com/

http://www.jasperforge.org/

mailto:[email protected]





Questions?

54

Contact Information

If you have further questions or comments:

Mark Madsen, Third [email protected]

Andrew Lampitt, Jaspersoft

[email protected]

Bob Zurek, Infobright

[email protected]

About the Presenter

Mark Madsen is president of Third Nature, a technology research and consulting firm focused on measurement and analytics, business intelligence, and data management. Mark is an award-winning architect and author whose work has been featured in numerous industry publications. Over the past ten years Mark received awards for his work from the American Productivity & Quality Center, TDWI, and the Smithsonian Institute. He is an international speaker, a contributing editor at Intelligent Enterprise, and manages the open source channel at the Business Intelligence Network. For more information or to contact Mark, visit http://ThirdNature.net.

mark r. madsen third nature may 26,...

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