What if all we had was Omniture and Google Analytics?
Since the acquisition of Visual Sciences/HBX by Omniture, there have been tremendous discussions about the future of the Industry. Everybody seems more or less to agree that a concentration is taking place which is somehow normal as Web Analytics is a maturing industry.
Now let’s imagine for a second that this concentration continues and we end up with two solutions. What if all we had at our disposal was Google Analytics as a “basic” free tool and Omniture, the “enterprise” platform, serving the high-end of the market?
How would this landscape affect consultants and practitioners? Would it be a good thing? Or would it be the end of analytics as we know it today? I wanted to open the discussion regarding this topic and know what other people have to say.
Before I go any further, I want to disclaim that as founder and CEO of OX2 that has now joined the LBi Group, we are vendor independent and we thus have partnerships with many Web Analytics vendors including Omniture (through their certification program) and Google Analytics (being members of the GAAC program). This is my personal opinion and doesn’t necessarily reflect the official position of LBi.
That been said, let’s start the discussion! Take a moment and imagine the future I just pointed out. If we had just those two vendors how would that affect us?
On the one hand, I can think of positive effects:
- Training would be easier for consultants such as ourselves as we would have fewer tools to support and understand. Nowadays we have to understand how to get the same metric from Omniture (SiteCatalyst / HBX), Google, WebTrends, Unica, IndexTools, … which, to be quite honest, is often a pain with many vendors – not all - as their underlying documentation can be opaque and support doesn’t always seem to understand what we are actually talking about;
- Practitioners could more easily switch jobs as all companies would be using either one or the other tool;
- Other products such as content management systems, emailing systems, other internet related systems would more easily be integrated with the two existing WA platforms. And compatibility costs would be lower. But not only online software, this would be also the case for other tools such as BI or CRM tools, allowing a better understanding of the online activities;
- Having only two WA platforms would also allow benchmarking easier as we all know that putting 2 tools next to one another inevitably gives you grey hairs. This might push for standardisation, which in term would also mean that switching between tools might be easier. But here, I might be dreaming: each vendor has his own tags. Moving from one solution to another, when you’re working tag based will always be a nightmare.
But as everything in life there’s no yin without a yang. Let’s see some negative effects of this situation:
- As for many industries, a duopoly generally leads to a lack of innovation. Certainly if there is collusion at hand and as GA’s pricing model is different from Omniture’s one, they might have a shared interest in locking the market between their solutions. After all, competition is good. Just take a look at how vendors have been competing these past years to release more powerful tools and better functionalities to address the complexity of Web Analytics;
- If Omniture would be the only enterprise solution, prices would remain high while I strongly believe that WA tools will more and more becoming a commodity, putting downward pressure on prices. Don’t forget that a tool is just that: a tool and that you need people and processes in order to use them correctly, which are the most important factors in a WA project. We have customers doing great things with Google Analytics and I’ve seen very poor uses of expensive WA tools. Look also at Office suites, currently you could say that you have two main options: Microsoft and Star Office; Microsoft still sells their software at a very high price and they make margins of over 70%! If there was a real competition I bet that prices would be lower;
- Having just Omniture and Google Analytics wouldn’t/couldn’t suit every need. Not all websites are alike and we see it already today that a single tool doesn’t fit all. Take for example Coremetrics that focuses on retailers and seems to be doing a great job regarding this vertical. Look also at Unica that allows big corporations to integrate easily WA to Campaign management.
My opinion regarding this question is that it wouldn’t be good for the industry if we ended up with just 2 products (I’ve taken Omniture and Google Analytics as they are the two most important tools nowadays, but it could apply to any other). As I mentioned tools are just part of the equation, an essential but not an important part.
Getting back to Omniture and Google Analytics, the first still has some competition at the enterprise level, which doesn’t seem to be the case for Google Analytics. Let’s be honest, even if we are big fans of Ian Thomas, Gatineau hasn’t, for the moment, been able to be a big threat to GA …
For more on my perspective you can read some of my thoughts about the future of the Industry following the Omniture acquisition of Visual Sciences here:
http://webanalytics.ox2.eu/2007/10/27/omniture-pacman-what-future-for-visual-sciences/
http://webanalytics.ox2.eu/2007/10/31/how-the-web-analytics-industry-will-evolve-with-omniture-as-the-green-giant/
So what do you think? Do you have other things to add to the pros and cons? How would you see yourself in this scenario? Do you want to see a two vendor market, kind of like Windows versus Apple, or do you like the diversity of options we have before us today?
I am looking forward to having a spirited and honest conversation about the future of the analytics market and thank Joseph and Eric for giving us all a venue to chat.
René Dechamps Otamendi, CEO, OX2 (part of the LBi group)
Phil Pickard added the following ...
This acquisition does somewhat mirrors that what Microsoft is trying with Yahoo, which has recently been rebuffed yesterday. I disagree slightly with your argument regarding that a duopoly often leads to a lack of innovation. Maybe this is what is seen at first, since there is almost a process of maturation and standardisation in the industry, but usually what follows is the creation of niche competitors that target specific solutions that cannot be met by either one or the other product and hence giving way to a burst of micro-innovations in the industry.
Eric Peterson added the following ...
@Rene: I too share the concerns you have about innovation and pricing in the marketplace, but your thoughts on the “goodness” of fewer solutions to learn definitely resonates with me.
The ever increasing number of companies understand Avinash’s 10/90 rule and my 10/20/70 variation is creating a powerful need in the marketplace for some level of standardization if only to help those new to the industry come up to speed quickly. When the WAA released their standards document I commented that it was a good start but was unlikely to every be widely adopted — the vendors that are non-compliant have no motivation to change their underlying technology to become so, and there is no mechanism for enforcement (or even interpretation, which is why I suggested a standards adherence matrix.)
Fewer vendors to learn would alleviate some of this, and the new “standards” would be basically whatever the dominant vendors were currently shipping; we would basically back into standard definitions by attrition. And then, as you point out, it would be easier to move between companies, develop advanced expertise, etc. in much the same way our counterparts in market research, CRM, and business intelligence do.
So I guess for me the question becomes “Does the benefit of standards and an easier to learn technology landscape outweigh potential pricing, support, and innovation issues that ** might ** arise?”
What do you think?
Also, I am inclined to agree with you, Steve, and Peter that this particular vision is unlikely at best. Coremetrics, WebTrends, Unica, Nedstat, IndexTools, and many others are still very much in the game to win and I think optimistic about what Omniture’s integration challenges will bring about. And I sincerely, sincerely doubt that we’ve seen the last of the consolidation OR the last free product to be offered up to the community.
That, coupled with the recent explosion of niche vendors in the video, widget, social media, mobile, etc. sectors, will undoubtedly persist the cycle that we’ve lived with for nearly the last decade. Which, despite my wishing for an easier way to train new analysts and get them up-and-running, is almost certainly a “Good Thing”.
Great post and thanks for starting what is sure to be an interesting conversation!
Joseph James Geertz added the following ...
I would not go out on a limb and suggest that the field will be owned by two players, but I’d agree with Phil’s vision of consolidation. The Pareto Principle, based on Pareto’s analysis in 1906 that 80% of Italy’s income went to 20% of the population, suggests that 80% of the revenue in the field will go to 20% of the industry. That standard has been a fair economic approximation for over 100 years. The 10/90 and 10/20/70 rules are presumably efforts at industry redefinition of the same.
That 20% may come from a small set of businesses (e.g., automobile manufacturers) or a large set (residential construction), which will impact whether the market is consolidated to a handful of companies or tens of companies, but the market will consolidate. The remaining 80% of the businesses get to engage in the niche competition and micro-innovation that Phil spoke of.
How does economics decide how many companies occupy the 20% plateau? It comes down to how scalable and transportable the leading businesses are and how large are the barriers to market. Many service industries are not sufficiently scalable/transportable to allow a small number of businesses to dominate nationally or internationally. The investment involved starting up an auto manufacturing business is astronomical, operating as a barrier to market that holds down the number of players.
Web analytics, to the extent it is automated/productized, is scalable and transportable, although the barrier to entry is low, not unlike video games for nonproprietary systems. You could probably end up with 5-10 businesses occupying that top 20%. Web analytics, to the extent it is a personalized service, is not scalable and transportation costs are higher, while barrier to entry remains low, so the top 20% will be more populated, likely without any entity having as much success as the top web analytics product businesses.
Unless you have a vested interest in one of the players, I don’t think who the players are affects how the game plays out.
For those interested, WPP (communications company with deep pockets) just announced they purchased a stake in nuconomy (another analytics company with a dubious claim to measuring engagement).
Palani Balasundaram added the following ...
Since the question is what if we had just two players, Omniture and GA, i would like to approach this discussion from the websites point of view.
It would make the work simpler for websites to adapt to web analytics. For organizations, to understand analytics they may try out with the free Google Analytics and once the belief is established they may go up the value chain and opt for Omniture. I do agree that migration would be lot more easier and there would be some sort of standardization.
I also share the view that the competition is one factor that helps in breeding better products and it also helps in pushing the prices down.
What would happen to the world of “Mobile Analytics”?
Bryan Cristina added the following ...
Ripped from my yahoo group post..
I can certainly see some of the benefits - I wouldn’t mind not having to dig through parameter/code-level documentation in order to figure out how one package does something that the other does. It would be nice to know all the little nuances of a product instead of some of the nuances across many. I would be able to jump into helping more clients quicker than if I had to touch up on a tool. Keeping track of version changes would be in one nice place..
But in the long run I think it would be a disaster. As mentioned in the article, innovation would take a huge hit. There’s obvious features that are lacking in products that I’m sure would be taken care of, but if there were only one enterprise vendor I don’t think you’d see something like innovations in flash/ajax tracking or things like WebTrends Score.
I also think pricing would go up while service would go down. If there’s only one real vendor and you have all your history in there, I can see them getting greedy and raising prices - your data as the hostage in the negotiation. They’d likely be a public company, and that means satisfying the anonymous conscienceless shareholders who want growth at any cost. And when it comes to fixing your problems, why should they care. What are you going to do, jump ship to a free version? Not quite, they’ve got your stones in a vice and if they get around to fixing your problem, or not, it’ll probably be all the same to them. It’s not as if you can suddenly start telling your CMO that you’re not going to analyze data anymore.
But as this industry grows, there’s always room for someone to break into things by being less expensive, more friendly, and more innovative - a company that is starving and will do anything for your business. And maybe there will be one main vendor eventually, but it’ll probably at best be one main vendor and a supplemental vendor to take care of the things they refused to innovate on.
Eric Peterson added the following ...
On the point of innovation, something to consider is that the stuff we take for granted has come from a variety of different vendors. Fireclick is widely attributed as developing the first browser overlay, WebSideStory got the Excel reporting stuff right first, Omniture had the first really good path browsing features, Coremetrics had the first visitor-based analysis engine, WebTrends has WebTrends Score, and there are probably a dozen more examples spread across the vendor-sphere highlighting that no one vendor has driven innovation in this market.
(Please don’t flame me if that list isn’t what you were thinking … I’m trying to make a point, not review patent assignments.)
Lately we’re seeing much the same thing: vendors around the world are popping up with innovation in measuring widgets, social networks, video, mobile, RIAs, engagement, etc. And again, it’s not like any one vendor is clearly leading the way into (say this with an ominous voice) “THE FUTURE OF WEB ANALYTICS”
This is why I’m conflicted: Palani makes a great point that from a practitioner perspective fewer is likely better. And if there were only two, the migration path from one to the other would inevitably be easier (despite the lock-in problem, but that is an entirely different subject for debate IMHO.)
I know Rene has some thoughts on this but is at Web Analytics Wednesday in Berlin right now. He will undoubtedly pipe up in the next day or so … thanks to all of you for contributing to the conversation!
Judah added the following ...
Hi Rene. Congrats on the acquisition! It would be unfortunate to see a vendor landscape that consisted only of two vendors serving different market segments (SMB and Enterprise). We use web data to assess business performance. If the duopoly didn’t provide capabilities for a certain type of measurement I needed to guide decision-making, then I wouldn’t be able to make data-driven decisions until one of the duopolists decided to accomodate my need. The reason I have guided some businesses away from certain vendors (and some towards) is because they were deficient in features or capabilities that the business believed they needed to “win.” Competition catalyzes (no pun intended) innovation via differentiation. Competition leads to the genesis (pun intended 
of features and capabilities that answer market demand. In other words, I think the market should drive the product, not the product driving the market, which is what I fear in the scenario of duopoly (or worse yet monopoly).
Ian Thomas added the following ...
Rene,
An interesting post, indeed. I see your reasoning – you don’t have to extrapolate the current rash of consolidation very far to get to the scenario you’re painting – but I think you have it wrong in one crucial respect. See, in the future, there will be more places you can do web analytics, not fewer. I made a prediction some years ago which I still stand by, which is that eventually the ‘stand-alone’ web analytics tools that we currently know and love will be absorbed into (or absorb, in some cases) adjacent technologies and tools, until there’s no such thing as a “web analytics vendor”.
On the web-analytics-being-absorbed side, there is an increasing number of places where you can find web analytics as part of a wider offering. You mentioned Unica, which is a great example; so too is Lyris (formerly JL Halsey, who owns Clicktracks). Then there are the analytics capabilities of ad-serving tools like DFA, Atlas Media Console, and 24/7 Real Media. And what about the CMS systems like Interwoven or Vignette, which have integrated analytics and (in the case of Interwoven) MVT, or CRM systems like E-piphany? As these various embedded offerings become richer and richer, free tools like Google Analytics and Gatineau will face competition from these free systems (in almost all the above cases, the analytics is offered as a free value-add, rather than being charged for).
After all, what is Google Analytics if not an embedded analytics application within a wider ad platform? It’s true that Google positions GA as a strong, independent analytics tool, and they (and we) have good reasons for doing that (the data collected by the analytics is highly valuable in aggregated form), but ultimately both Google’s and our offerings fit into the same mold.
At the other end of the spectrum, what will become of Omniture’s, WebTrends’, and CoreMetrics’ offerings? Well, WebTrends and CoreMetrics may well be absorbed into other environments, like online marketing automation; but my prediction for Omniture is that it will continue to absorb other businesses in related areas until the day comes when web analytics is only a minor part of what the company offers. We’ve already seen them do this with behavioral targeting (TouchClarity) and MVT (Offermatica). I predict that we will see Omniture acquire an ad server in the not too distant future. Why would they not, after all? Their value proposition to sites is that they can run and optimize their online marketing through Omniture’s services; having an in-house ad server would be a tremendous help in doing this (at the moment, Omniture has to reach complicated data-sharing deals with the likes of DFA to get hold of this data, or add cumbersome Omniture tags to ad calls).
So I’ll go further than your thought experiment: what if in the future there were no web analytics vendors, but web analytics was everywhere? What would the consultant community do then? Discuss….
Ian
Denise Eisner added the following ...
If the WA space were to be dominated by the likes of GA and others that depend on cookies to track users, sites that prohibit cookies from a privacy standpoint would be out of luck. Websites that adhere to the Government of Canada’s standards for example are cautioned against implementation of persistent cookies due to stringent privacy laws. This has all but stopped the use of GA for federal government web sites here in Canada.
Eric Peterson added the following ...
@Ian: Any chance I could get you to expand on your “What if web analytics was everywhere” question for a follow-up post to Rene? It’s a hugely interesting point (IMHO, but I am a known navel-gazer it’s true) and I think it merits its own discussion. You know how to reach me so please let me know.
@Denise: An excellent point, but what if we assume that Omniture is able to leverage their investment in Visual Sciences software and provide a cookie-free solution. Does the same objection still exist? I’m not saying they ** will ** but they certainly ** could ** …
René Dechamps Otamendi added the following ...
First of all, my apologies for the late comment on all your comments. I had a very busy week including a trip to Berlin to attend the latest German Web Analytics Wednesday organized by Oliver Schiffers which by the way was a great event with a couple of presentation by Neil Mason, Director of the WAA and Matthias Bettag from Bayer. In addition the acquisition of OX2 is adding lots of things to do as we plan to move in the coming weeks our offices and well I still have to run the business even if I’m now just an employee 
But let’s get back to your comments:
@Steve, thanks for your comments regarding Omniture’s perspective. It’s clear that Google Analytics is a big threat to all vendors and lately I’ve seen many companies walking away from ‘paying’ tools towards Google Analytics. This for two main reasons: price of course but also ease of use. Some enterprise solutions are really hard to use by people that are not Web Analytics dedicated and many companies don’t even have one dedicated resource to Web Analytics. As GA has imho the best user interface in the industry it’s much easier for this type of user to use this tool. Of course this might mean that they are not yet taking Web Analytics as seriously as they should, but well that’s another discussion
@Phil, I get your point regarding micro innovations, but I still think that the duopoly will bring lack of innovation. Even if we have niche players that will focus on some aspects of web analytics (as Crazy Egg for example) I don’t see large corporations using several ‘little’ tools in order to get answers. Large companies need an integrated tool that will allow them to deploy on a global scale and thus having many little tools would be a real nightmare in a process point of view. We have many clients on a panEuropean or Global scale and I can assure you that even using a tool is difficult at the beginning. You can read more in the two presentations we had last year in our Web Analytics Wednesday in Brussels:
http://www.slideshare.net/Renator13/slideshows (watch the presentation from Michaël Notté from Toyota and the one from Julien our Country Manager in France).
I also invite you to watch/hear the WAA Webcast ‘Taking the pulse of International Web Analytics’ (you need to be a member of the Web Analytics Association to access):
http://www.webanalyticsassociation.org/waawebcastseries/2007archives/index.asp
@Eric, I understand your concerns about standards, I think that we all in this industry would love to have more spread standards among vendors, but the price to pay (having that duopoly) is just not worth it from my perspective, for the reasons I explained in the original post. I hope that standards will come one day but not because of acquisitions and lack of competition
And don’t get me wrong, the purpose of this post was to create discussion I don’t think that this reality will happen one day, but I find it an interesting exercise to explore that possibility and see what you all have to say about it. Thanks again for giving me the opportunity to express it here and your kind words on he Yahoo Group.
@Joseph James, while I know the pareto principle since I was I kid I don’t see the relationship with the 10/90 or the 10/20/70 rule… I don’t think that this industry can be ‘measured’ in terms of revenue as we have major players that have changed the rules. You state that 80% of revenue will go to 20% of players, what do you do then with players as GA and Gatineau? Google is by far the player that has more customers (if we could call like that their users) and it gets no direct revenue from it (except the ones using Urchin software which are a small minority). And regarding consolidation, even if we are seeing it happening these past years, I don’t think that it will go much further. Ian’s comment is very interesting on this but I’ll come to it afterwards.
I’m afraid that I disagree also with your statement that the barrier of entry is low in this industry… How many new global players have emerged in the past two years? It’s a very complex industry on the technical side and I don’t think that building a WA tool is an easy task and neither to market it right to get its use spread.
@Palani, you present exactly the dilemma that I was explaining. It’s clear that having 2 players would make things a lot easier for many things but your question about ‘mobile analytics’ shows that we need innovation in this field as the Internet is rapidly changing and I don’t expect it to stop any time soon. Nobody knows how we will surf in the future, what devices we will be using, etc… Yesterday night I was having a conversation with Aurélie and she told me that by when our future son will be able to surf, we would only give him access to the Internet from the computer in the living room (to avoid misuse) as our son will be born this year, this means that we are talking about a situation in 4-6 years time and my reply was ‘we don’t know what technology we will have at that time and if we will be able to control it…’. Getting back to Web analytics we need innovation as the Internet evolves and what is standard today won’t be in a few years. Take a look at social media tools or the example you gave about mobile…
@ Bryan, I really like your explanation where you say that data will be taken as hostage in the negotiation Which brings to another question, will the market accept in the long term that data sits outside in some servers they cannot control? The WA industry has moved these past years from software to ASP, but from my perspective in the future we will see a come back of software solutions as companies will want to make sure they own the data and that they can easily reuse it in other systems in order to integrate them. The web is not an island anymore! At OX2 we have customers in the public sector and all of them use software WA tools, they wouldn’t dare to take an ASP solution… And in the latest request for proposals that we have won in this sector, they always wanted to have access to the database where the data sat, so going further to not only software versions but also open databases…
@ Judah, well what can I reply to you except that I think that you’re right as always See you soon in SF!
I stop here for the moment as the next comment is going to take me a little bit more of time to answer (thanks Ian ;-)) but I promise I continue today!
Thanks again to all of you for your contributions and I hope that you don’t mind if I didn’t agree to all of you, but well that’s the idea to discuss and share point of views. No hard feeling?
Cheers,
René
Rene Dechamps Otamendi added the following ...
@Ian, in the end I’ve decided to write a new post following your comment, you’ll find my thoughts there
@Denise, it’s clear that privacy is becoming more and more an issue. Only the future will tell us where all this is going. I have to admit that I’m sometimes frightened when I see all that we can do with Web Analytics. I strongly believe that we as the Web Analytics industry need to create some codes of conduct or else like in Canada the legislator will do it on our behalf and not always the right way as legislators have sometimes problems understanding the technology and can miunderstand some concepts. There are for example regulations here in Belgium regarding emails that are more protective that the legislation of regular postal mail…
You can read some thoughts regarding this in a post I wrote last year (read specially the comments under the post): http://webanalytics.ox2.eu/2007/05/16/google-analytics-microsoft-gatineau-ox2s-web-analytics-code-of-ethics/
Cheers,
René
mbchoe added the following ...
to eric’s first question, my answer is…
that state of affairs would be terrible for companies that buy web
analytic software. 2 players in a niche marketplace would mean
higher prices and less innovation. both are terrible outcomes, from
economic and technological perspectives.;
fortunately, i don’t think the folks at webtrends, coremetrics,
clicktracks, etc will throw in the towel anytime soon.
Daniel Shields added the following ...
I am not exactly sold on the idea that Google is ‘competing’ with Omniture. As I see it, Google has provided a means to the compete by measurement in the market for web entities who cannot afford the pricetag of a commercial solution. In that regard, I think that they are complementary solutions.
If speculation pans out to anything, Google has its eyes on cellular bandwidth. Though I do not know whom, and if I did I certainly could not say, but someone made the reserve bid of $4.5 billion on ‘C Block. Let’s just take a look, Google has $166 billion in market capital and receives $0 in fees for using its tool. Its fair to assume this is not a company with a stake, yet, in trying to bully the world of online measurement. It seems to me, and I’d be willing to bet that the folks in Palo Alto would agree, that their attitude toward measurement is something akin to: “Yeah, we do some of that too.”
Omniture, on the other hand, has been gobbling up googles of “best-in-breed” for just about a year now. It was, I believe, Instadia, TouchClarity, Offermatica, which predated the WebSideStory/VSCI snag in October. This is a telltale sign of a company who is aware of competition down the road, and unsure of what angle its going to come from.
In theory, the discussion that a duopoly is bad for innovation is true. To play the part, I’d say, if we were to have a duopoly and these were the players, this particular race would be a good thing. Google, if they are capable of resonating their motto of ‘Don’t be Evil’ would seek to educated, accelerate, and elevate the practice of analysis based on game theory. (I think I covered some of that in my blog, if not, you could probably get the idea from a watching of ‘A Beautiful Mind’). In a nutshell, they would do what is good for them, and the market.
Omniture, I’d bet, would seek to emulate this, but, might play the cards a little closer to the chest. They’d probably do best to open the doors a little more. By that, I mean that they should concentrate less on the market tectonics and more on providing quality customer service to the complicated, but useful product, which they have as their primary business model foundation. They would also do better to settle the sales and empower users. For What its worth….
The Future of Web Analytics, Demystified » Blog Archive » Web Analytics is dead. Long live Web Analytics added the following ...
[…] of you will have read Rene’s very interesting post on this blog, in which he posits a world where there are only two web analytics tools to choose […]
Eric Peterson added the following ...
@All: Ian Thomas submitted a post for the blog that I would encourage you to check out — Web Analytics is Dead. Long Live Web Analytics!
Thanks to everyone who is participating! I agree, unlikely that the other vendors (and emerging vendors) will give up anytime soon!
Anil Batra added the following ...
Great Post Ian. However I partly disagree with both the predictions
1. In three years there will be no Web Analytics vendor, but Web Analytics will be everywhere - I completely agree that Web Analytics will be everywhere in next few years. This is already happening, as you mentioned and provide several examples. However, I disagree that there will be no Web Analytics Vendor. Microsoft, Google, Oracle, Atlas, Doubleclick etc. will (or already do) provide web analytics as an add on to their products but there will still be a need for one web analytics product you can rely on to make strategic decisions. Can you imagine having 15 different web analytics solutions that all give you different numbers? There will still be a place for deeper and strategic web analytics tool. I agree that the functionality of web analytics tool will change and they will continue adding more products. They might not be known as web analytics vendor but web analytics will be a core product that they will provide. They will be providing more than web analytics and they are already moving in that direction.
(Side note: I also agree that Omniture will buy an ad serving company, I made the same prediction last year . I also predicted that Oracle will get into Web Analytics, because I believed that web analytics will become essential part of marketing automation, Online advertising, CRM etc. and Oracle won’t want to be left behind. And actually about 10 days after making the prediction they did buy a company that has web analytics product).
2. In five year, all Web Analytics will be Free – There is no free lunch, we all know that. As John Levitt commented, most the tools that provide web analytics as an add-on product provide very light analytics and reporting. Their web analytics offering is to support or enhance the value of their product and offering, so that they can keep up with competition. There will still be a place for deeper and strategic web analytics and that will come for a price. Web Analytics maybe subsidized if you buy other products from a company like Omniture but it won’t be free (bundle discount).
A lot things can change in less than 5 year, Omniture can start using the web analytics data collected on the sites to create an online advertising network (they have pixels everywhere, they can buy an ad serving company, use touchclarity and offermetics to deliverer right ad to the right person at the right time) and then I can see they provide free web analytics tool if you let them aggregate user behavior and do targeted advertising. (My suspicion is that Google will be doing that soon too).
Anil Batra
Director of Analytics and Strategy, ZeroDash1
http://webanalysis.blogspot.com
Dean Collins added the following ...
Hi Rene,
Well the first point that comes to my mind is that there would be no “mobile web analytics offerings”.
Theres a great post on mobile analytics you might want to check out by Bryson Meunier here;
http://www.brysonmeunier.com/the-mobile-seo-s-guide-to-mobile-analytics/comments/41#comment-41
It gives a pretty good overview of ALL the players in the space – yes even http://www.Amethon.com
Interesting to note that neither Omniture nor Google is even mentioned
Regards,
Dean Collins
Dean.Collins@Amethon.com
Phone: +1 646-240-4043
Denise Eisner added the following ...
For those interested in seeing how this government looks at cookie implementation (and therefore implications for GA or similar products0:
http://www.tbs-sct.gc.ca/pgol-pged/cookies-temoins/cookies-temoins05_e.asp#s6
Steve Jackson added the following ...
Rene : This is my personal opinion and doesn’t necessarily reflect the official position of LBi.
I agree with your assessment of the situation. If GA and Omniture were the only players on the field it would not be the best environment for analytics customers. Lack of innovation, lack of competitive pricing and poor servicing of customer needs negatively outweigh the plusses you mentioned, which serve more the consultant than the actual businesses investing in the tools.
Interestingly though Omniture actually see their biggest threat comes from GA and Gatineau, not the other enterprise vendors. At least that’s according to Neil Weston when he talked to E-Consultancy.com last year;
http://blackbeak.conversionchronicles.com/2007/12/11/omnitures-neil-weston-talks-to-e-consultancy/
When asked “Do you see Microsoft and Google as a threat in your space then?”
Neil commented;
“I think we have got to assume that. We’ve got a reasonable revenue track and the cost of entry would be very high, particularly to get to where we are now. But Microsoft and Google certainly have the wherewithal to do that if they want to.
Their strategies are typically to seed the market with something and then turn it into money. So it would be remiss of us not to assume that both of them will want to come and eat us up at some point in time.”
As I said at the time I’m not so sure Google or MS will want to go that route.
I do think it’s prudent of Omniture not to be complacent and face the reality of their situation but I just feel that it would be a small return on investment for either of those giants to mount an attack on Omniture.
What return would they get for the many hundreds of millions they would have to spend to catch up and take on Omniture now?
One of them if anything may simply acquire Omniture. With a market value of 1.5BN that would be expensive but considerably less hassle for Google than developing GA to be as good as the top of line products Omniture’s customers demand.
If however I were driving the Google or MS bus, I would continue developing, giving the tool away for free and use aggregated information of their clients to develop massive panels of “internet usage patterns”. That data is more valuable to them than the client base of Omniture.
Feeding that kind of information back into advertising models is perfect for targeting based on behavioral patterns between websites.
Additionally the way I see GA and MSG differentiating is that they will continue to build the demographic segmentation. Gatineau is in a basic alpha/beta stage but the combo of MSN with their data is very insightful and something Omniture would never be able to get into.
Google are doing this already in the UK with SEM targeting based on gender panels. It’s not in GA yet but I feel it’s only a matter of time.
So I think the tools have very different futures based on the early signs of how their development cycles are panning out.
Now to answer the original question;
What if all we had at our disposal was Google Analytics as a “basic” free tool and Omniture, the “enterprise” platform, serving the high-end of the market?
Gladly I don’t think we ever will. If it were the case and all the other good vendors out there were either acquired or edged out of business by Google/Omniture I would invent something better and smash the market open with the force of my willpower alone!
Joking aside I wouldn’t ever expect a situation like this to exist.
More consolidation is inevitable but not that much I think.