The Telegraph's online offering is reaping the rewards of
outsourcing its visitor analysis.
Knowing your readership and attracting advertising revenue is as
crucial for online publishing as it is with the paper-based
publications.
In the past, the business model of many online publications was
highly suspect. Access to valuable information was free and little
consideration was given to how the sites would make money, although
it soon became clear that revenue from banner advertisements was
not enough in itself.
Making online publications more profitable is now a common goal.
Some, like the Wall Street Journal online (
www.wsj.com), have chosen
to leverage their strong brand and reputation by charging visitors
who want to view its pages. Others such as the
telegraph.co.uk,
the online arm of The Telegraph newspaper, have turned their
attention to e-commerce and are courting alternative revenue
streams. These include areas such as holidays sold through the
travel Web site, its fantasy football feature and an online betting
service.
This move has led to an increased focus on business intelligence
and customer analytics.
The Telegraph launched the Electronic Telegraph in 1994. Since then
both the marketplace and telegraph.co.uk have changed dramatically.
Telegraph.co.uk, which is owned by Hollinger Telegraph New Media
(HTNM), now has 17 different sites. Topics that once formed
subsections of the main Web site, such as sports, travel and money,
have been spun out as fully-fledged commercially driven channels.
HTNM now delivers about 27 million page impressions a month and
claims to have more than 1.5 million monthly unique users. The
company wanted to boost e-commerce revenue and target these online
readers with personalised services which meant keeping track of
customer behaviour became a major consideration.
Previously HTNM had relied on a bespoke, in-house system based on
Oracle and Perl to track and analyse user behaviour on its sites.
It also briefly used a third-party tool, Net Genesis, but found it
was not sufficiently flexible to meet its needs. The search for an
alternative tool led the company to business and customer
intelligence firm WhiteCross Systems.
"The big disadvantage of the old system was the amount of effort it
took to maintain it," says technical director Andy Teesdale. The
level of internal expertise and resources needed to support it was
compounded by the lack of flexibility, which made it difficult to
adapt to changing business requirements. In contrast, Teesdale says
WhiteCross offered an outsourced model, which reduced the strain on
internal resources and reduced the level of up-front investment
required. It is also relatively simple.
WhiteCross began working with HTNM during the test phase of the
sport.telegraph.co.uk
Web site last November, in preparation for its launch that
December. It has since been involved in the launch of all the other
new channels.
HTNM started off by looking for general trends in customer
preferences. It then began "segmenting" offers to groups of
customers according to their profile and behaviour. The next step
is to provide more personalised offers and information.
Customers that log on to the company's sites are "tracked" and
their behaviour recorded in a daily log file. WhiteCross
centralises the data from the various sites before analysing
customer behaviour. It provides channel-specific and cross-channel
analysis for all of the telegraph.co.uk sites on a daily, weekly
and monthly basis. These reports are then published on a Web site
later that day, where they can be viewed by authorised HTNM staff,
such as channel heads and the marketing department.
HTNM also uses an outsourced tool from Gomez to measure the
performance of its sites. Every 10 minutes the service tries to log
on to each of the company's sites from different global locations
and records the download times. This helps the company to see where
the peak times are and help identify, and ideally avoid,
bottlenecks. "The useful thing for me is putting the two together,"
says Teesdale. Gomez helps identify the peaks and WhiteCross helps
to explain them.
"I think it improves your understanding of the customer base," says
Teesdale. "If you understand them better you can better serve their
needs."
He says it closes the loop, providing valuable feedback and helping
the company to learn and improve.
Also, because the logging analysis is carried out offline, any
problems with the WhiteCross service does not affect the
availability or performance of its sites. This is a major
consideration, says Teesdale, and has helped the company avoid
troublesome service level agreements and unnecessary downtime. On
the flipside, he acknowledges that this means the company does not
get real-time data, although he says that getting the performance
information in real time is more important.
Business development director Matt Duffy points out that
advertising - including banner ads, sponsorship, listings and
classifieds - is the key revenue stream for the company, although
"e-commerce revenue is becoming increasingly important for us". As
for charging for content, Duffy says the big question is "when is
editorial unique enough to charge for?"
Having topic-specific sites and then using customer analytics and
business intelligence to target users with more personalised
services is helping to boost return on investment, he says. The
company also hopes to increase registration levels and encourage
customer loyalty.
"As the understanding of our users increases so too does our
understanding of the business," says Duffy. "It is difficult to
predict exactly how the usage of data analysis will evolve. However
we do know that customer data and analysis is becoming increasingly
important to our business."