Friday, July 25, 2014

LinkedIn Buys Bizo and Oracle Adds Database Services: Everything Is Going According To Plan

The past week brought two industry announcements: acquisition of Bizo by LinkedIn and new “Data as a Service” offerings from Oracle. Both illustrate the continuing evolution of marketing technology towards a data-centric world.

The Bizo purchase, priced at $175 million, makes perfect sense.  It gives LinkedIn more tools to expand its marketing offerings and lets Bizo use LinkedIn data to improve targeting within its own products. Some eyebrows were raised by a statement on LinkedIn’s blog that it will sell off Bizo’s Data Solutions business, which markets Bizo’s 120 million name database of business contacts. But LinkedIn doesn't need that data: it already has vastly better information in its own files.  Retaining Bizo's data business would only have raised questions about whether LinkedIn data was somehow leaking into the marketplace through Bizo. Many LinkedIn customers would have considered this unacceptable use of their profiles, regardless of whether LinkedIn’s privacy policy actually allows it (which my quick reading suggests it does). The more interesting question is who, if anyone, will buy the business from Bizo.

The Oracle announcement provided unintentional symmetry with Bizo: as LinkedIn was leaving the customer data sales business, Oracle was expanding its offerings. Arguably Oracle’s announcement was little more than relabeling of the BlueKai data management platform it purchased in February. But Oracle presented it in terms that make clear it sees a new, central role for data in the marketing technology stack – a view I share wholeheartedly.

In fact, Oracle’s discussion made almost exactly the same points I’ve been making about Customer Data Platforms: that marketers need a shared customer database which integrates information about each individual and makes the consolidated information easily available to analysis and execution systems. The key notion is that this consolidated database has its own very high value, apart from the value of any applications that use it. Oracle is supporting this vision by ingesting data from hundreds of partners; doing advanced quality assurance, identity matching, and “signal extraction” from unstructured data (i.e., intent, sentiment, themes, topics, entities, etc.); and providing connectors to dozens of ad targeting, site customization, testing, and analysis systems. It also highlights functions to manage data access rights in compliance with privacy, regulatory, and contractual obligations, something that's also important even though I haven’t given it quite as much attention.

While this is quite similar to what BlueKai did before Oracle bought them, it’s a big difference to have Oracle’s muscle behind the vision of making it easy for marketers to access to a rich, powerful customer database. Among other things, the Oracle product will set a benchmark for pricing of similar services by other vendors.  I didn't see a price announcement, but if Oracle prices aggressively and executes well, it will be much harder for smaller vendors to compete. The likely result is to switch the focus of competition from assembling data and providing a database to making clever use of the data through things like advanced analytics. That’s really where smaller vendors can shine and, from some lofty cosmic viewpoint, the world is better off if the smart people focus their creative energies on that rather than on duplicating the basic data assembly capabilities.

Back to that question of who will buy Bizo’s data business: I wouldn’t be at all surprised to see take it over, since it would supplement their existing business and give an advertising-oriented data management platform to balance against Oracle/BlueKai. In the on-going tit-for-tat competition between Salesforce and Oracle, that is probably reason enough for Salesforce to do the deal.

Friday, July 18, 2014

Are Millennial Marketers More Analytical?

I had an interesting conversation this week with a vendor of marketing measurement systems on the question of why more marketers won’t buy his type of software. After all, surveys often show that marketers and CEOs alike rate better measurement as a high priority. Yet actual measurement techniques don’t improve much from year to year: to cite the most recent report to cross my desk, the 2014 State of Marketing Measurement Survey Report from Ifbyphone found that 45% of marketers are measuring Return on Investment in 2014 vs. 40% in 2013 -- a gain that is probably within the survey's margin of error.  Other, simpler measures are more common and growing more quickly, but that’s exactly the point: marketers don’t invest in meaningful performance measures like ROI.

My vendor friend’s suspicion was that marketers don’t buy better measurement because, whatever they say in surveys, they really don’t want to be measured. My own opinion, based on comments from marketers over the years, is they don’t have time to put advanced measurement systems in place.

Of course, time is a matter of prioritization, so this really means that marketers think the time spent on an advanced measurement project will produce less value than if that time were spent on something else.  In other words, marketers don’t invest in advanced measurement because they don’t think the resulting information will drive enough improvement in their marketing results.  That's not an unreasonable belief: much ROI information is in fact interesting but not actionable and, therefore, adds no business value.  Further evidence: the advanced measurement techniques that have been widely adopted, like marketing mix models and multi-touch attribution, all have proven bottom-line impact. The impact of marketing ROI, on the other hand, is often less clear.

Then our conversation took an unexpected turn: the vendor speculated that younger marketers might be more analytical and hence more inclined to ROI measurement.  This was a new thought to me and offered the cheery prospect of an actual change from the long-term status quo. But neither of us had seen any research on the topic, so we couldn’t judge whether it was likely to be true.  End of discussion.

I’ve since had time to look into this more deeply. There’s plenty of research on millennials’ (currently 19-34 years old) in general and a fair amount on their behavior in the workplace. Most of it reinforces familiar stereotypes: millenials are collaborative, tech-savvy, results-focused, fast-working, multi-tasking, anti-hierarchical, socially-conscious, company-disloyal, and of course digitally connected. But none of the research shed much light on whether they’re more or less analytical than older generations: since they’re skeptical of authority, you can expect them to be more open to challenging past assumptions, but this doesn’t necessarily mean they rely on data to resolve those challenges. They could just as easily rely on what feels right to them, even though they’ve had little time to sharpen their intuitions on the stone of reality.  Even their presumed affinity for digital media, which is certainly more measurable than traditional media, doesn’t necessarily translate to an interest in ROI measurement. Indeed, most digital measurements such as Web traffic and social media interactions have almost nothing to do with ROI.  Finding that millennials rely heavy on them would bode poorly for advanced measurement methods.

But all of this is just speculation, and I am definitely a fact-based kinda guy. Has anyone seen any information on how marketers’ behaviors differ by generation? If not, would you find it an interesting topic for a survey?

Thursday, July 03, 2014

StrongView Moves Beyond Email to Real-Time, Contextual Marketing

Today's email vendors face an interesting business challenge. On one hand, building a high-volume email engine is a lot harder than you’d think, so business is strong despite near-commodity status. But marketers want to integrate email with other messaging channels, so a stand-alone email platform is increasingly unattractive. The obvious solution is to add other channels and, even more important, features to control the decisions of when, how, and to whom messages are sent. This puts vendor at the center of the marketing operations, helping them to retain clients and charge higher fees.

Indeed, this strategy has succeeded for many vendors: ExactTarget, Responsys, Silverpop, and Neolane all grew from mostly-email to broader systems that were purchased by larger vendors as the foundation of an all-compassing marketing suite. Other email providers have remained independent but still expanded their scope to remain competitive and grow.

StrongView, which was original email specialist StrongMail, has followed this course. Rotating banners on the company Web site position StrongView as a “product platform” and “marketing cloud” as well as mentioning “cross-channel lifecycle marketing”, “present tense marketing”, “true one-to-one communication” and “the first customer insight solution supporting unlimited cross-channel interaction data”. This may set a world record for buzzword intensity, but that’s okay so long as the underlying product matches the implied promises. On the whole, I’d say it does.

The key to all this is the one unfamiliar phrase on the previous list: “present tense marketing”. This is StrongView’s own coinage, intended to describe their proprietary view of context-based marketing (which strikes me as plenty buzzy all by itself, but then I have a low tolerance for such things). The gist of contextual marketing, in StrongView's definition, is to tailor customer treatments to the current situation (location, device, environment, past behaviors, etc.), so those treatments lead the customer in a profitable direction. StrongView sees this as the future of marketing and has defined its strategy as helping marketers make the transition by providing the necessary technology and supporting services.

StrongView earns considerable credit in my book for articulating a proper strategy: one that defines not just a goal (helping marketers make the transition) but also the method for achieving that goal (by providing the necessary technology and services). Still, articulation is just a first step. The next is even more important: implementing the method effectively.

StrongView has identified several key implementation requirements. Necessary technologies include real-time analytics to select best treatments; dynamic message assembly to construct those treatments; and multi-channel routing to deliver the treatments via email, SMS, mobile apps, Web pages, social media, and display ads.

Of these technologies, content creation, dynamic assembly and delivery are extensions of the company’s original email functions. StrongView has supplemented them by building an impressive campaign flow designer that handles complex, multi-step programs.  Predictive analytics rely on external modeling tools, but the vendor will compensate with prebuilt models and with services to create custom models. There’s also a methodology to guide creation of campaigns and models.

All these functions require a much larger, more flexible data environment than a traditional email system.  StrongView has stepped up to the challenge by building a data store using Amazon RedShift.  This closes a critical gap faced by email vendors trying to reach the next level.  StrongView has also knitted together everything from content creation and campaign design to execution and reporting in a tightly integrated user interface, another requirement in providing the speed and efficiency needed for a “contextual” approach.

Finally, we come to services.  StrongView recognizes that many marketers will need help in making the transition towards more advanced marketing techniques, so it is offering marketing strategy, analytics, technical development, campaign design, creative, production and delivery.  These are sold on project or retainer basis as appropriate. StrongView is clear that these services are intended to help marketers supplement their own resources, not to convert the business into a service agency.

All told, this is a pretty complete package. Although StrongView’s vision is far from unique, they have carefully worked through the implications to define and deliver a complete solution.  This should be enough to get their customers started.  Results will determine what happens next.