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Build, Buy, or Rent

MM: Right. In the analytics space, it seems to me that there’s a quadrant. Basically, you’ve got log analyzers and then you’ve got tag-based solutions. They’re tagging specific pages or applications. Then you’ve got hosted SaaS solutions and maybe hybrid or traditional software. Traditional, on-premise software, with maybe a SaaS back-end or something. Can you take us through the thinking—the strengths and weaknesses of those approaches?

BK: In my opinion it all comes down to the customers needs. The first questions a company needs to answer include: what information do I need to capture and report on, and why? Depending on the size, sophistication and importance of a companies web infrastructure they will define the investment they’re willing to make in technology and the manpower to implement web analytics.

Obviously log-file analysis is less expensive to purchase, implement and support. But the data set is less robust and may not answer all the open questions to improve on-line interactions.

Page-tagging solutions are more expensive primarily due to the time and knowledge required to properly implement them, but the data is much more robust and should provide answers to most of the previously mentioned marketing questions.

The decision for software (on-premise) or SaaS (hosted) largely comes down to a couple of questions the customer has to address around security, data access and integration, and the resources to support the solution. In my experience most companies today are finding ways to outsource every IT solution they can.

MM: Sure. So aside from regulated industries—be it healthcare or finance, the trend, if I understand you, will continue to accelerate more toward a SaaS and/or a hybrid SaaS.

BK: Well, that would be my assumption from conversations with IT directors. I hear constantly that Service Level Agreements (SLAs) are being increased and budgets are being slashed. IT has to evaluate what is a core competency or competitive advantage and keep those in-house. All else can probably be handled less expensively out-of-house.

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