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Targeted E-mail: From Spam to Choice Part 5: Page 3

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Posted March 10, 2003 By Bruce McCracken     Feedback
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Gold feels that business intelligence is extremely important and that businesses need to deliberate on how they choose to implement the integration. "The advantage is very clear in using an outsource provider. Their core competency is managing those systems. They don't need to worry about any of the infrastructure headaches. The trade off is that the systems may not be highly customized and not tailored around the business processes of the customer but rather what is convenient to the ASP to provide."

Outsourcing to the ASP leverages many additional advantages including performance accountability through a well-crafted service agreement and costs spread out over time with reduced up front cash outlays for licenses, infrastructure, and personnel. The risk is much less as the enterprise can walk away from the arrangement after the agreement lapses if the value proposition does not merit continuing. With a licensed model, there is the risk that the application will not meet the needs of the enterprise and expensive software becomes shelfware.

Gold continues, "It is a very easy decision to say that, for now we will outsource it and later on bring it in-house. The countervailing forces are that if something is working, don't fix it. The CIO must measure the risk/reward of taking it in-house. It comes down to the individual requirements."

Gianforte looks ahead to see that the key for ASPs will be in management of the integrated data as a growing customer base leverages economy of scale. "There are numerous examples today of companies that have successfully performed a variety of high-value integrations in very short order and with relatively simple programming. Successful application providers today have built their software from the ground up for multi-tenancy over the Internet. The question down the road will be how to manage large numbers of XML-based integrations as customers embrace the Web services model more and more."

Allen concludes, "Related solutions are helping marketing organizations successfully address three interrelated challenges -- strategic planning, collaboration, and resource management. The greatest potential returns are coming to the companies that are tying together customer analytics, campaign management, other CRM applications and all customer communication channels into a coordinated system for managing the entire customer lifecycle."

I See Said the Blind Man
Increasingly, ASPs are offering their clients services to map various applications, even legacy systems, to be able to pull out data in a common language to be integrated into reports for high level management for improved coordination between various departments often running different applications. This is not new for much of the Global 3000. But what is new is that the ASPs are doing this for their customers, many of which are SMBs or independent divisions of larger enterprises. ASPs are able to leverage economy of scale in doing this as the costs are spread out over many customers over time.

In a simple sales analogy, a CEO may want to measure the effect of a targeted e-mail campaign on a temporary price reduction on a particular new printer. Previously, the click stream could be tracked to give the direct response that led to orders on the migrated path to buying on line. But this does not reflect the total impact and latency of the campaign.

A customized report can now be generated to incorporate the sales that were made online independently of the e-mail click stream at another point in time that cross references the e-mail list for the name and address to match up with the purchasing name and shipping address. Further, in the traditional retail channel, the names and addresses could be measured in the warranty registration cards as well as the sales differential. The combined data could yield a much clearer picture of the campaign.

On the flip side, CRM/customer care, the same principle can be applied to measuring customer questions and inquiries from online support, e-mail, and all touch point levels at the call center to reveal a shortcoming in the way the new printer's owner's manual was written.

This information enables the key members of the management team to assimilate disparate information, theoretically through out the value and supply chain, to react and plan with greatly increased speed and agility. The idea is not to constantly merge all of the data but rather be able to assimilate data as needed for specific strategic and tracking purposes. No longer is the CEO forced to have business vision impaired by not being able to see the forest for the trees.

Bruce McCracken is a business writer with specialization in outsourcing. His coverage areas are primarily in IT, eCommerce, CRM, HR, and supply chain/distribution with focus on small to mid-sized companies. He may be e-mailed at abatar@bsn1.net.

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