ULTRABRAND’S JOURNEY TO A SMARTER WEB ANALYTICS PRODUCT OFFERING Ryan Ward-Williams wrote this case under the supervision of Professor Binny Samuel solely to provide material for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying information to protect confidentiality. This publication may not be transmitted, photocopied, digitized or otherwise reproduced in any form or by any means without the permission of the copyright holder. Reproduction of this material is not covered under authorization by any reproduction rights organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Ivey Business School, Western University, London, Ontario, Canada, N6G 0N1; (t) 519.661.3208; (e) cases@ivey.ca; www.iveycases.com. Copyright © 2016, Richard Ivey School of Business Foundation Version: 2016-11-17 On a cool fall day in October 2014, Ryan Ward-Williams, chief executive officer (CEO) of Ultrabrand and a 2015 HBA candidate at the Ivey Business School in London, Ontario, looked at the options his sales director had presented to him that would allow Ultrabrand to expand its web analytics service offering. Ward-Williams was completely puzzled as to how to proceed. The company was losing potential revenue every time a client either turned down Ultrabrand’s basic Google Analytics installation service or switched to another digital branding provider that was offering a clearer, more robust web analytics solution. One specific recent client interaction weighed heavily on Ward-Williams’s mind. Back in 2012, Ultrabrand had worked with Xu-Dermatology, a company that was looking forward to revamping its website in 2015. Dr. Xu, the primary physician and founder, was adamant about having a web analytics solution built into his new website in order to provide the practice with new, actionable insight to help to generate new patients, sell more skin care products, and better market its services to surrounding neighbourhoods. Dr. Xu was unsatisfied with Ultrabrand’s current web analytics offering, and he made it clear that Xu-Dermatology would be submitting requests for quotes to other digital branding agencies that were better equipped to meet his web analytics needs. Ultrabrand was a high-end, invite-only digital branding firm, and Ward-Williams knew that in order to justify the high price the company charged to its executive and celebrity clientele, its ancillary services (like web analytics reporting) would have to be just as extravagant and just as functional as its core product—branded website design. But with three options on the table, all with relatively similar characteristics yet vastly different price points, Ward-Williams struggled to identify the differentiated advantages of each option and decide which option fit best with Ultrabrand’s high-end brand image, its unique customer base, and its business model. More immediately, he wondered which option might allow him to keep Xu-Dermatology as a client. Time was of the essence since every lost client represented, on average, approximately $15,000 1 in potential sales—over 10 per cent of Ultrabrand’s yearly revenues. 1 All currency amounts are given in Canadian dollars unless otherwise stated. Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. 9B16E034 Page 2 9B16E034 Xu-Dermatology was a premiere dermatological practice located in Las Vegas, Nevada, and run by Dr. Robert Xu, who was one of the top dermatologists and Mohs (i.e., chemosurgery) surgeons in the United States. With several other top physicians and medical estheticians on staff, Xu-Dermatology offered cosmetic and aesthetic services like laser hair removal, tattoo removal, microdermabrasion, Botox injections, and other dermal fillers, as well as serious medical procedures like Mohs surgery (the removal of cancerous skin cells) and skin grafting. The practice was among the highest grossing in the United States, and it attracted patients from all over the country who specifically sought the medical expertise of Dr. Xu and his staff. Dr. Xu knew that Las Vegas was a small market, with a population of just over 600,000. The success of his firm could be attributed to patients not just from Las Vegas, but also from the major cities surrounding it in Nevada and in the neighbouring states, including Henderson, Reno, Phoenix, and even Los Angeles and Salt Lake City. With over 65 per cent of his patients coming from out of town and 30 per cent from out of state, Dr. Xu wanted to learn more about these out-of-town patients. How had they found XuDermatology? What services attracted them to the Xu-Dermatology website? What was it about XuDermatology that prompted hundreds of patients to drive, or even fly, out of state just to be treated there? How could Dr. Xu upsell to these patients and keep them coming back to the Xu-Dermatology website for specials, sales, and new-service announcements? These were the kinds of questions that Dr. Xu was told he could have answered by a business intelligence (BI) analyst who approached him at a medical media convention in Los Angeles. As soon as the analyst finished his pitch, Dr. Xu contacted Ultrabrand to ask whether or not it had a competitive offer for a web analytics solution that was similar to—or better than—the current version he was using (see Exhibit 1). When Ward-Williams explained that, currently, Google Analytics was Ultrabrand’s only option as an analytics solution, Dr. Xu scoffed and said: The BI analyst I spoke with told me that Google Analytics was too complicated, too limited, and too difficult to interpret without a professional analyst’s interpretation. I don’t have time for that. I need someone or something that can tell me how to strategically lay out my website to maximize out-of-town sales and visits. If you can’t offer this, I’ll have to sign on with someone else who can. Dr. Xu seemed serious about his intent to switch digital branding providers if Ultrabrand could not offer a competitively priced solution with similar effectiveness. For a cost of US$20,000, the business intelligence analyst had offered Dr. Xu a six-week engagement that would help him gain a better understanding of how to maximize his returns on his website’s traffic. ULTRABRAND LTD. The origins of Ultrabrand could be traced back to January 2010. Through a course he took in high school, Ward-Williams learned how to use digital creative products like the Adobe suite of products (e.g., Photoshop, Flash, Dreamweaver, InDesign, etc.) and other similar e-design tools. He developed a knack for creating appealing digital media, mainly in the form of website design, and he got his first big break when his uncle, who owned a prominent bed and breakfast in Quebec City, Canada, invited WardWilliams to redesign his website. The redesign provided such a dramatic overhaul for the bed and breakfast that it acted as a springboard for referral clients who were looking for a similar type of redesign for their own websites. Ward-Williams’s reputation quickly spread, and throughout the next year, he Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. XU-DERMATOLOGY’S SEARCH FOR A SMARTER WEBSITE 9B16E034 designed websites for over 50 bed-and-breakfast businesses across Canada. Eventually, he started to branch off into working with other small businesses that were looking for an overhaul of their online marketing efforts. In 2013, for legal and taxation purposes, Ward-Williams and his best friend, Remington Humphreys, who was the company’s chief operating officer, legally incorporated the Ultrabrand business. On February 18, 2013, Ultrabrand became Ultrabrand Ltd. In addition to his role as the company’s CEO, Ward-Williams also served as Ultrabrand’s acting creative director and oversaw all project development with his clients. Ultrabrand went on to become home to over 150 unique brands around the world, with over 75 per cent of its clients based in the United States. In terms of product offering, Ultrabrand served five core areas of digital branding—website design, content management, web analytics and reporting solutions, software and app development, and voiceover services. The websites that Ultrabrand built for its clients were completely customized solutions, typically designed in some combination of HTML5, PHP, CSS, WordPress, and Joomla. One of the company’s core philosophies on website aesthetics centred on highresolution, rights-managed photography. Ultrabrand clients who did not own their own photography for their business often chose to purchase a photography retainer, facilitated through the company’s exclusive syndicate, Getty Images. Thanks to its success, Ultrabrand was able to develop a highly selective client approval process. The company served a very specific type of customer—business owners, executives, and celebrities based in the United States, all with corporate or personal revenues that ranged between US$2.5 million and US$100 million. These entities typically employed anywhere from 20 to 250 people, viewed digital branding as a core investment in their business, and spared no expense in procuring the finest branding services in the world. Some of Ultrabrand’s most prominent clients included Sotheby’s International Realty, Berkshire Hathaway, Harvard University, private jet firms, luxury retailers, and celebrities like Lindsay Lohan, Grammy Award-nominated rapper The Game, and Miss Nevada 2014. The business operated on an invite-only basis and typically did not accept walk-ins or visitors to the company’s corporate website, Ultrabrand.com, who were looking for digital branding services. Ultrabrand charged a flat rate of $300 per page designed within a given site, and it enforced a strict $2,500 minimum spend for its web design services. On average, from 2013 through 2014, Ultrabrand clients spent between $9,000 and $20,000 on accounts with the company, and in 2014, the company began enforcing a strict minimum yearly spend of $2,500. Comparatively, a typical web design company would charge in the range of $1,500 to $2,000 for a medium-sized web campaign, but Ultrabrand’s strong brand image and its track record of excellence allowed it to charge approximately $15,000 for a similar product and workload. By invite only, Ultrabrand offered a sleek, black titanium card—the Ultrabrand Private Client Black Card—to its corporate and celebrity clients who spent over $20,000 on accounts with the company in one year. The card offered exclusive benefits such as around-the-clock priority customer service every day of the year (all provided directly by Ward-Williams) and volume discounts. This level of service was an industry first—a symbol of excellence that was adopted from the business models of the company’s various private jet charter clients. In 2014, Ultrabrand’s revenues surpassed $110,000, with a pre-tax net income of $95,000. The company’s main expenses consisted of development costs that were outsourced to partners in India and Bangladesh, commissions paid to part-time sales representatives, and hosting service fees for the company’s multiple domains and hosting products (i.e., it was a reseller of hosting services). Even the main software that was Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. Page 3 9B16E034 used to design web solutions was licensed from Adobe Systems Inc., and Ultrabrand currently had no information technology (IT) staff. This lean start-up model, with few employees and low direct technology assets, meant that Ultrabrand could work virtually and save money that would otherwise be paid for physical offices. Because the company had low expenses and uncharacteristically high margins, Ward-Williams was often willing to invest large amounts of his own personal funds to help the business grow and appeal to highly profitable customer segments (see Exhibit 2). QUESTIONING ULTRABRAND’S CURRENT WEB ANALYTICS OFFERING Since the introduction of Google Analytics to the company’s product offering in 2012, bolstering this service as a solution for web analytics reporting had proven to be a challenging undertaking for WardWilliams and his team. Specifically, the product had been lacklustre in terms of client adoption, retention, product support, revenue scaling, and brandability. Ward-Williams knew it was time to reconsider the construction of this product offering and to decide what technology and organizational resources would be needed as a foundation for executing a more sophisticated strategic approach, especially given the useful performance indicators that web analytics could provide business owners with (see Exhibit 3). In general, the company found upselling the web analytics product to be a challenge in itself. During the preliminary project-planning stages of a new website design, approximately 50 per cent of Ultrabrand’s clients indicated that they wanted web analytics, while other clients did not even know what web analytics was or how this kind of software would benefit their business. Those clients who did understand the many benefits of web analytics software expected something better than Google Analytics—a free product with limited features—especially from Ultrabrand. As a result, many prospective clients would either scoff at the company’s surprisingly bland solution for web analytics and then look for another web development company with a more impressive web analytics arsenal, or they would decline the software because they did not have the time, the know-how, or the cost-benefit understanding of how web analytics could help their organization. On average, Ultrabrand lost potential revenue of $200 for every declined installation and around $15,000 for every potential client that took their business elsewhere. WardWilliams could not help but think of the additional revenue Ultrabrand could be earning on better web analytics reporting software, and he wondered how he could effectively upsell this service to his clients. For clients who opted to have Ultrabrand install Google Analytics as part of their total web development package, retention rates of the solution were lacklustre and product support was difficult to administer. Many clients complained that Google Analytics was providing them with skewed data that rendered the solution worthless (e.g., tracking of spam or “robot crawler” traffic from foreign countries that would be unlikely to organically visit the company’s website). Some clients even complained that the software was reporting impossible data, such as zero monthly traffic or outrageously high traffic numbers that were likely inaccurate. Additionally, many clients who used Google Analytics complained that the software was very difficult to use and understand, with an overwhelming user interface that made it hard to comprehend what the software’s reports meant. Because the basic version of the software was a free product from Google, support was limited to Google’s online help forums. Support that came directly from Google employees was available only with the company’s premium version of the product, which meant that Ultrabrand had to service and support Google Analytics for its customers. Ward-Williams was concerned that Google Analytics’ confusing interface, inaccurate reporting, and lack of instant product support would reflect poorly on Ultrabrand. For the Ultrabrand clients who were satisfied with Google Analytics as their primary web analytics reporting solution, Ward-Williams still wondered whether there was a better, and legal, way to monetize Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. Page 4 9B16E034 this branch of his product offering. Because Google Analytics was a proprietary product owned by Google, Ultrabrand was not allowed to charge its clients on a reoccurring basis to use the software; it could charge for the one-time installation service only. Finally, many customers—both current and prospective—found it confusing and odd that Ultrabrand charged anything at all for Google Analytics, given that the software itself was a free product. Because the software was relatively easy to install, many clients opted out of the installation service and either installed Google Analytics themselves using simple tutorials that were available online, or they temporarily hired a cheaper web development company to install the service at a much more cost-effective rate. Ward-Williams was concerned that this situation would hurt Ultrabrand’s high-end, custom, luxury image, and he questioned whether or not it was even worthwhile to continue offering web analytics to its customers, given that revenue scaling was limited. Finally, Ward-Williams felt uneasy about the idea of facilitating a web analytics solution through Google, whose Google Sites product made it a potential competitor. Referring Ultrabrand’s clients to Google Analytics meant that they would access the product off-site through google.com/analytics and would thus be subjected to a Google-branded interface over which Ultrabrand had no control. In keeping with the company’s high-end brand image and premium pricing, Ultrabrand’s clients expected a product that was branded to Ultrabrand’s trade dress and available either through the Ultrabrand website or through an administration portal on the clients’ own sites. Considering these shortcomings in Ultrabrand’s current web analytics product offering, Ward-Williams felt that his company needed to invest in an accurate, easy-to-use web analytics solution that offered some reoccurring revenue potential and that would be branded to Ultrabrand’s elite and aesthetically beautiful trade dress. Thinking about the way his current offering reflected negatively on the company’s brand image, combined with the loss of potential revenue it caused, Ward-Williams set out to explore the technology acquisition options that were available to him in an effort to revitalize the web analytics aspect of his business. He narrowed his options down to the three most viable and realistic options he could find. OPTIONS FOR CHANGE Inspectlet: White-Label Web Analytics Reselling The first option Ward-Williams explored to revamp Ultrabrand’s web analytics product offering was an existing, white-label web analytics solution from a Toronto-based company called Inspectlet. The term “white-label” was used to describe a product that could be licensed and resold under another company’s name, logo, and trade dress. Inspectlet was a web analytics service that allowed the user to watch visitors interacting with their website. In addition to typical web analytics functions, Inspectlet also recorded videos of visitors’ actions on a webpage as they used the website (i.e., mouse movements, page scrolling, links clicked, etc.), thereby allowing business owners to see what aspects of the site captured the visitors’ attention. Inspectlet was founded in 2011 by the company’s current CEO, Rachit Gupta, who recognized that the existing solutions in the market were lacking. Since then, Inspectlet had established a customer base of more than 25,000 clients and was used by some of the most popular websites in the world. Inspectlet differed from other products on the market in many ways. In most cases, Inspectlet was considerably less expensive, and, right out of the box, it supported advanced web apps that used AJAX, modals, etc., whereas alternatives required extensive integration efforts with their API by the licensee’s developer team. Inspectlet was built for web apps of this century and offered a turnkey solution—even for password-protected, session-based pages or other dynamic content—without requiring any extra development. Essentially, the product worked with almost any existing website. Critical reception of Inspectlet had been positive over the years since its launch; companies white labelling the software Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. Page 5 9B16E034 consistently reported that their clients were impressed with the solution’s ability to streamline their users’ experiences. Inspectlet was careful to build its solution with accurate reporting in mind. The software contained an extensive suite of automated tests built into the application to make sure its reports were accurate, even as the company iterated the product. Another important consideration on behalf of the Inspectlet team involved maintaining accuracy across the breadth of devices accessing the Internet. The company conducted tests against the full gradient of mobile and web devices and browsers to ensure accuracy, no matter what platform the website visitors were using. In terms of the hardware required to operate the Inspectlet software package, there was no additional hardware for the client to purchase; Inspectlet handled everything, and the installation took only a few minutes, at which point the client started seeing their data instantly. This level of performance held true whether the client had just a few monthly visitors or millions. Unique to the Inspectlet platform was the fact that it did not claim to compete against Google Analytics; in fact, the company recommended that their clients should use Google Analytics and Inspectlet in tandem. Google Analytics provided Inspectlet’s users with the baseline generic statistics that all websites needed, while Inspectlet gave the user the innovative tools (e.g., heat map technology; see Exhibit 4) they needed to answer business-specific questions. In essence, Google Analytics answered the question “What?” and Inspectlet answered the question “Why?” In terms of pricing, Inspectlet started from $40 per month at the lowest tier for up to three client websites and went up to $299 per month for the largest plan in the regular tier, allowing for up to 20 client websites. For large-enterprise deployment, a custom pricing scheme would be created, depending on the licensee’s specific needs, and Inspectlet would tailor a solution with a unique cost for those deployments. Ultrabrand would require a custom enterprise deployment plan, since the company would need to be able to offer web analytics to at least 100 customers at the outset. According to Inspectlet, the total cost would be approximately $1,495 per month. The company offered a 15 per cent discount for annual, up-front payments, and it did not require a commitment to an annual subscription. There were no limitations on how much Ultrabrand could mark up the white-labelled solution under its own brand. Inspectlet was often used by branding agencies as a product complement to their core offering. The company offered a number of different ways to integrate its licensee’s logo and brand, ranging from very deep integrations through the Inspectlet API to something more transparent that utilized Inspectlet’s own dashboard and reporting functionality. Regardless of how the licensee chose to approach integration, Inspectlet claimed that the user experience would be seamless, with single sign-on capabilities and other considerations to reduce friction for users as much as possible. In terms of support, Ultrabrand customers could contact Inspectlet at any time via email, but the company could also empower Ultrabrand and its account managers to handle the vast majority of support requests on their end. If the account manager was unable to resolve the issue, Inspectlet could be looped into the conversation at Ultrabrand’s discretion. Finally, Inspectlet was continuously watching the evolution of web applications in order to reflect the current trends in its own product. Many new capabilities that had become popular in the last few years (e.g., HTML5 APIs) were welcomed into the Inspectlet product with native support. Inspectlet software was iterated regularly, with new code being pushed live on an almost daily basis to enable fresh product improvements. Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. Page 6 Page 7 9B16E034 Ward-Williams also looked into having a custom software company build a web analytics reporting solution that would be completely tailored to Ultrabrand’s needs, including a user interface that would be extremely easy to understand and operate within, as well as a look and feel that would be specifically tailored to Ultrabrand’s trade dress. In his search for a custom solution, Ward-Williams reached out to Whitecap. Whitecap was a custom software developer and systems integrator that was founded in 1997. The company was a mid-sized developer with a team of 35 full-time employees that was made up of software architects, software developers, project managers, quality assurance analysts, and graphic designers. Whitecap was a Microsoft GOLD application development partner that was known for its custom webbased and transaction-based applications, custom BI software, mobile apps, and cloud computing. The company served customers across most industries and markets in Canada, including energy, healthcare, financial services, non-profits, business services, transportation, real estate, and entertainment. Ninety per cent of Whitecap’s business each year came from the company’s installed base of existing customers. Repeat customers were a testament to the quality of the work Whitecap did and to the success of the projects in which it engaged. Like Inspectlet, Whitecap embraced Google Analytics as a base tool for tracking and collecting data on how people navigated websites. To create a custom web analytics solution for Ultrabrand, Whitecap would use Google Analytics as the engine for the new product solution in combination with the firm’s BI expert, who used a wide range of BI tools (primarily from Microsoft) to create web analytics solutions that provided businesses with actionable results. In essence, Whitecap would use a multitude of available backend tools in combination to build its custom software for Ultrabrand. The sum of the product Whitecap could build for Ultrabrand would be greater than the value of its parts; custom software from Whitecap would provide Ultrabrand with a tool that did exactly what it needed to do in terms of the functionality Ultrabrand wanted to bring to its customers. According to Whitecap, offthe-shelf software solutions were quite general in nature, and a company like Ultrabrand might be required to change its business practices to match the way such software operated instead of having the software adapt to the company’s unique business process, as with a custom solution. In essence, a custom solution from Whitecap would help Ultrabrand to compete in crowded marketplaces. “If your company looks and operates like everybody else in your industry because you’re all using the same software and running the exact same business processes, it becomes very difficult to differentiate your [service offering],” said Robb Carmichael, founder of Whitecap. “Custom software developed specifically for your company is an asset! An asset that you own, which can also help to drive company valuations higher when it comes time to sell your company,” he exclaimed. The Whitecap solution would be completely customized to Ultrabrand’s brand image and trade dress, and, upon completion, the solution and its code would be 100 per cent owned by Ultrabrand. In terms of pricing, custom software from Whitecap would start with a discovery and design process that would involve a consulting engagement to determine exactly what Ultrabrand was looking to achieve with its custom software. Whitecap charged for this consulting engagement, which, depending on the size and complexity of the requirements, could take days or even weeks to complete. The total cost for this consulting service was $12,000, an amount that Ward-Williams would have to pay whether or not he decided to proceed with Whitecap. At the conclusion of this design and discovery exercise, however, Whitecap would provide some very detailed specifications and requirements as to what needed to be built, how it would need to operate, and what it would need to connect to or integrate with. As part of Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. Whitecap: A Custom-Built Web Analytics Solution 9B16E034 Whitecap’s deliverable, the company produced a detailed project plan for completing the work and a fixed price for building the application. The final custom software would be hosted in the cloud by Whitecap and would require no physical assets from Ultrabrand in the near future. In addition to the consulting services, the total cost to build a custom web analytics reporting software for Ultrabrand would be approximately $50,000. For product support, Whitecap tailored its support services to match the customer’s requirements. Since the solution would be highly customized to Ultrabrand’s exact specifications, including the solution’s ease of use, Ultrabrand would be empowered to provide its own support for the product to its customers. Should Ultrabrand need support and wish to receive it from Whitecap, the company was on call around the clock, every day of the year. It offered multiple levels of escalation as appropriate and, in some cases, even provided disaster recovery plans. Whitecap was also committed to updating and modernizing its software solutions wherever possible. The company’s founder commented on the fluid nature of Whitecap’s software solutions: “The custom software we build is ever-evolving according to our customers’ requirements. When they wish to make changes to the software we built for them, it is our responsibility to ensure we are not using technology that will inhibit them or box them in in the future.” GOOGLE ANALYTICS: BOLSTERING THE EXISTING SERVICE OFFERING Despite its perception among some of Ultrabrand’s clients as being cumbersome to use and interpret, Google Analytics stood out as one of the strongest web analytics engines on the market, as referenced by the fact that it acted as the base engine in the above-listed custom and semi-custom solutions. While Google Analytics did not fit with the high-end, custom brand image that Ultrabrand’s customers had come to know and expect, there was some merit in attempting to bolster the company’s product offering related to Google Analytics, and, accordingly, there were ways to earn revenue through the use of the platform. The major drawback of Google Analytics as Ultrabrand’s main web analytics solution centred around the fact that most of the company’s customers did not understand how to interpret the solution’s insights, and they did not have the time or patience to warrant its use. With so many different key performance indicators and an overwhelming user interface, the Google Analytics interface was so complicated that even Ward-Williams and his team did not fully understand every metric and its relevance; after all, no one on the team was technically trained in business intelligence. Ward-Williams wondered about the possibility of hiring a BI analyst. In essence, a BI analyst would act as a full-time consultant for Ultrabrand’s clients, employed specifically for the purpose of making sense of the valuable information that Google Analytics yielded regarding traffic flow on the company websites. In addition to making sense of the data, the BI analyst could be employed by Ultrabrand’s clients to answer specific questions related to their own businesses. For example, the analyst could build custom queries for Ultrabrand’s clients, disseminate pertinent information, help the users understand how to disseminate the information on their own, monitor problems or points of interest in the way users navigated customers’ websites, create customized dashboards specific to what the business cared to know about, and even provide customers with monthly, customized BI reports that could drastically benefit the way Ultrabrand’s clients marketed their products. In essence, Ultrabrand could become a provider of BI consulting, opening up paths to several new and reoccurring revenue streams for the future. Doing so would bolster not only the company’s web analytics offering but also its overall human capital and attractiveness as a holistic digital branding solution. Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. Page 8 9B16E034 This option, paired with better marketing and sales initiatives for the service, could breathe life into Ultrabrand’s current web analytics offering without disrupting service. The average salary for a mid-level BI analyst in Canada for 2014 was $66,815 per year. 2 COMPETITORS AND THEIR APPROACH TO WEB ANALYTICS Because of the company’s unique global client base, a true competitor analysis for Ultrabrand proved difficult to execute. On the one hand, with thousands of freelance web developers, mid-market design companies, and full-scale digital branding agencies around the world, anyone with enough knowledge to design and code a website was technically a threat to Ultrabrand. On the other hand, with respect to Ultrabrand’s unique brand image and appeal to up-market and premium customers, Ward-Williams had never come across another company that operated at a similar price point with the same “high-end” product appeal as Ultrabrand. Over 80 per cent of Ultrabrand’s customers were not first-time website owners; the majority of customers already had a website but were looking to revamp it in a big way. In that sense, Ward-Williams often viewed the developers who built his clients’ previous sites as competitors since, technically, part of the Ultrabrand sales pitch involved convincing potential customers to switch providers. Ward-Williams identified three main competitors, all of which were taking full advantage of the lucrative web analytics market. WYSIWYG Website-Builder Services Wix.com was one of the world’s largest online website-building platforms, offering its customers a simple WYSIWYG (“What You See Is What You Get”) tool for building content-rich, mobile-enabled websites on a “freemium” model. Websites built with Wix.com, and other easy-to-use website-building services like it, accounted for approximately 30 per cent of Ultrabrand’s incoming clientele. While Wix.com provided its customers with support for Google Analytics, other WYSIWYG services, like GoDaddy Website Builder, offered their customers more sophisticated, proprietary web analytics solutions. These services provided beginner website-builders with the ability to see their site’s latest visitors and their locations, how much bandwidth the site used and when, and key metrics like bounce rates, all represented visually by the company’s “Webalizer” product. Most WYSIWYG services provided their customers with such analytics solutions for free as part of their hosting or upgradedfreemium packages, and most provided their customers with extensive service and support for these tools. Freelance Web Developers Freelance web developers were typically either sole proprietors of small web-design businesses or people who created one-off websites, typically on a referral basis. While freelance web developers were unlikely to have their own proprietary solution for web analytics, the majority of them were familiar with Google Analytics and typically offered a basic installation for their customers for free or a nominal fee. In most situations, though, freelance web developers were not BI specialists, and they left the task of interpreting web analytics data up to the customer, which meant that service and support for this activity was typically minimal. 2 PayScale.com, accessed September 1, 2016, www.payscale.com/research/CA/Job=Business_Intelligence_(BI)_Analyst/ Salary. Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. Page 9 Page 10 9B16E034 One of Ultrabrand’s biggest user bases for web analytics solutions was the celebrity and personality segment of its clientele. In most cases, these customers were previously signed with major national branding agencies that specialized in user engagement and interpreting BI from web analytics. For example, 1Media, a national content platform for celebrities with large social followings, designed its websites with actionable web analytics in mind, based on a proprietary service that combined web analytics with social media analytics. While companies like 1Media provided these proprietary services for free, the projects that customers had to build in order to gain access to these services cost upwards of $15,000—a price range similar to that of Ultrabrand. Companies like 1Media had been successful in adopting customized, proprietary analytics solutions as a key competitive advantage, and Ultrabrand had experienced difficulty signing the former clients of such companies because it lacked a similar web analytics offering. THE DECISION Ward-Williams was confused, to say the least. As he sat with his sales director, evaluating the three options on the table (see Exhibit 5), he wondered which one would make the most sense for Ultrabrand and its unique client base. Ward-Williams knew he needed to find a way to better monetize his company’s web analytics offering using a solution that better represented his brand and its reputation for excellence. He figured he should think about how each solution would play out over the next five years or so, at which point it was likely that technology advancements would require revisiting these ideas. Above all, Ward-Williams wondered which option would make the most long-term sense for him and his business. As a serial entrepreneur, he knew he wanted to continue building his business into an attractive acquisition target. He also wondered whether it even made sense to pick any of the three options presented to him as a long-term offering: Was web analytics just a fad, blown up by data-hungry marketing managers? Or did it provide real business insights, ones for which Ultrabrand’s clients would pay top dollar? Finally, was web analytics becoming so commonplace that Ultrabrand had no choice but to offer it and provide it free of charge just to maintain its clients? Ward-Williams leaned back in his chair and took another look at his options. With so many pros and cons for each, he knew it was going be a long night. Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. National Branding Agencies Page 11 9B16E034 In a nutshell, web analytics is a statistical tool that focuses on a business’s website and the way in which the site’s users interact with it. Sequences of raw data that track how a user navigates throughout a website, called “clickstreams,” are the foundation of this business insight technology. Typically web-based software suites, web analytics reporting solutions are loaded with specialized tools to help businesses make sense of clickstreams, which can reveal what pages within a website are being clicked, the sequence of events a user engaged in to get to those pages, how long a user remained on those pages, and where they went when they left the site—among other things. By analyzing these clickstreams, business decision-makers can find, for example, that their website’s structure is causing users to leave the site shortly after accessing it, that the first thing a user does when exiting the site is access a competitor’s web page, or that a promotion is not getting the online attention the business had hoped for. Using this information, businesses can alter the structure, content, and ease of use of their website to help achieve their online marketing goals and to maximize the efficiency and impact of their website. Businesses can also use web analytics tools to gauge interest in a new product, to fine-tune ad copy, and to test new delivery methods for their marketing efforts. Essentially, web analytics provides business decision-makers with a learning environment to continuously improve the impression they leave on their website’s visitors. According to a report by Forrester, 84 per cent of American businesses are using some form of web analytics as a major component of their online marketing. In most cases, web analytics suites utilize a string of code that can be pasted onto each page within a website that a business wishes to track. Over time, the constant collection of clickstreams will yield stable trends in the site’s usage, which can typically be segmented by various demographics, including the user’s location, language, browser, Internet service provider, and type of computer or device used to access the website. This information is often accessible through some form of “dashboard,” which graphically displays various key performance indicators customizable by the user, depending on what they want to see and track. Many solutions even allow businesses to see how many people are browsing their website right now, in real time, and to “watch” them as they click through the company’s website. Exhibit 3 shows the most common key performance indicators used by most web analytics reporting solutions. The use of web analytics as an integral tool for decision-makers in all sorts of businesses around the world comes from increasing pressure for executives to prove that the money they spend on websites is, in fact, bringing in more dollars to the business than it is taking out. Additionally, the capabilities of web analytics reporting tools have dramatically improved over the past few years. Where previously these tools could provide only rudimentary, retrospective insights, such as what country a user comes from, the recent increase in reporting capabilities can provide major insights that businesses can actually act on, with implications for the future. For example, tools like Google Analytics can now tell a business owner in the United States that on some given day, traffic to the company’s website from Canada increased 300 per cent. Upon consulting their dashboard, the business owner finds that a popular Canadian blogger has just published a post on the business, commending it for its excellent product line. The business owner can now use this information to create ads and social media outreach specifically targeted to Canadians, such as a special discount on shipping to customers in Canada. Situations like these ones provide actionable opportunities for business owners to capitalize on the bank of trends their website is collecting over time. Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. EXHIBIT 1: WEB ANALYTICS—A PRIMER Page 12 9B16E034 The sophistication of web analytics as a means for business decision-making is increasing. For example, the advent of A/B testing now allows business owners to test the effects of different messaging, promotions, site designs, and products on their audience. By directing one portion of web traffic to one unique presentation of a company’s website and the other portion to another unique presentation, business owners can learn which combination of sales, ad copy, and call-to-action media results in the most generated leads and, ultimately, the most sales. Components of web analytics like A/B testing have proven to be a major asset and competitive advantage to businesses that rely on online sales or lead generation through their website. Despite its obvious appeal for business and website owners, web analytics has its downsides too. For example, the overwhelming amount of data these engines track, aggregate, and report is often difficult for the average business owner or manager to interpret. In fact, there are entire job verticals dedicated solely to interpreting the data that web analytics software generates. BI analysts are some of the highest paid assets of most modern corporate teams and are responsible not just for making sense of what data from sources like web analytics actually means, but also for how to interpret that data into actionable insights on which a business can accurately base decisions. While the web analytics trend has got almost every website and business owner wanting to install tracking software on their site, they are typically less eager to actually sit down and learn how to interpret the data. Source: Created by authors using data from J. Lamont, “Web Analytics and Beyond... It’s a Multichannel World,” KM World 21, no. 10 (November/December 2012): 16–17; J. Stoller, “Not Just for Techies Anymore: Web Analytics Goes Mainstream,” CMA Magazine 86, no. 3 (May 2012): 18–19; M. L. Kent, B. J. Carr, R. A. Husted, and R. A. Pop, “Learning Web Analytics: A Tool for Strategic Communication,” Public Relations Review 37, no. 5 (2011): 536–543; P. Hyman, “Web Analytics: What’s Worth Paying For?” CRM Magazine 15, no. 5 (2011): 30–33; S. Adelman, “Becoming a Business Intelligence Analyst,” 2013, accessed September 1, 2016, http://cms2.dama-phoenix.org/wp-content/uploads/2013/07/PhxDAMADay2012_Becoming_ a_Business_Intelligence-Analyst.pdf. EXHIBIT 2: SIMPLIFIED INCOME STATEMENT FOR ULTRABRAND (TAXES EXEMPT) Source: Company files. Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. EXHIBIT 1 (CONTINUED) Page 13 9B16E034 Performance Indicator Conversion Rates Page Tracking Visitors Traffic Sources Cost Analysis Usage and Relevance How many visitors actually perform a goal? (i.e., view a specific sale item) This indicator includes metrics like the site’s bounce rate (the rate at which a user enters the site but immediately exits without exploring it) as well as the duration of a user’s session on the website. These indicators tell a site owner the difference between new versus returning users, as well as how many users are unique versus the same user accessing the site multiple times. This indicator tells the site owner whether a user accessed their site organically from a search engine (and what they searched to get there), through a paid search (like Google AdWords), through direct access (by typing the website into their address bar), or through social mediums (such as Twitter or Facebook). Cost analysis KPIs like cost per conversion tell website owners whether or not their expense for attracting users to their website (through mediums like Google AdWords) is contributing positively or negatively to the business’s return on investment. This information allows the site owner to amend their online advertising expenses accordingly and to allocate funds to the campaigns that provide the most conversion. Source: M. L. Kent, B. J. Carr, R. A. Husted, and R. A. Pop, “Learning Web Analytics: A Tool for Strategic Communication,” Public Relations Review 37, no. 5 (2011): 536–543; Dimensions & Metrics Explorer, accessed September 1, 2016, https://developers.google.com/analytics/devguides/reporting/core/dimsmets; “The 8 Most Important Conversion Metrics You Should Be Tracking,” Kissmetrics Blog, accessed September 1, 2016, https://blog.kissmetrics.com/the-8-most-importantconversion-metrics-you-should-be-tracking. EXHIBIT 4: INSPECTLET HEAT MAP Source: “Eye-tracking Heatmaps,” Inspectlet, accessed September 1, 2016, http://inspectlet.com/feature/heatmaps. Used with permission. EXHIBIT 5: POTENTIAL REVENUES VERSUS COST Option Inspectlet White-Label Solution Whitecap Custom Solution Business Analyst Hire Source: Company files. Total Cost $1,495/month $12,000 consulting fee $50,000 development cost $66,815 yearly salary Potential Revenue Stream 50 clients at $99.99/month each 30 clients at $199.99/month each 25 clients at $299.99/month each Authorized for use only by Michelle Meyer in MBA632 Case Studies in Data Analytics at Saint Mary's University of Minnesota from Aug 28, 2017 to Sep 24, 2017. Use outside these parameters is a copyright violation. EXHIBIT 3: MAJOR WEB ANALYTICS KEY PERFORMANCE INDICATORS 
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