Free IndexTools: Analysis and Market Implications
Last Wednesday I had the honor and pleasure of helping break the story about Yahoo’s acquisition of IndexTools. My post was pretty well received, generating over 40 comments and a handful of citations in the popular press. In that post I speculated two things:
- That Yahoo! would offer IndexTools at no charge by Christmas 2008
- That this acquisition was potentially a permanent game changer
This morning Dennis Mortensen sent me an email with the following message:
“your predictions was not that far off!
At his blog Dennis announced that Yahoo! was now waiving all fees for current clients, essentially making IndexTools free. Dennis also announced that current IndexTools partners would be able to deploy new IndexTools implementations free of charge. Finally, Dennis commented that for the time being IndexTools would be closed to new customers, giving Yahoo! a chance to determine what their next move would be.
Christmas, Tax day, whatever. Free is free.
While I am already on record as believing that Yahoo made an excellent strategic move in acquiring IndexTools, the “make it free now” decision is absolutely freaking brilliant and the guys who pulled the trigger deserve a medal.
In one fell swoop, Yahoo! and IndexTools:
- Assuage all of the fears of current customers regarding the transition, any hiccups, etc. by offering the best possible olive branch in the world: free stuff! Worried about the transition? Okay, don’t pay us. Concerned about your data? Okay, don’t pay us. Don’t like Yahoo! that much? Okay, don’t pay us.
- Create instant demand for the product, and an instant revenue stream to the few companies that have been loyal to IndexTools all along. Imagine your glee if you woke up this morning and learned that you’re part of a limited channel able to offer IndexTools at no charge to your clients? I know I’d be pretty happy!
- Serve notice to your competitors, whoever those competitors are, that you are not messing around and they need to get their act together quick. Regardless of what Google says (or rather, has not said) and what Omniture says, IndexTools directly competes for both of their business (and everyone else in the sector to be sure.)
This third point is important, and it speaks directly to why I think this acquisition changes our market more or less forever. So far the team at Google Analytics has been eerily silent — or if they have spoken I have missed their comments — but I have already talked to multiple people who have basically said, “It’s a no brainer, I’ll deploy IndexTools and either run Google Analytics for validation or drop GA entirely.” More importantly, I’m talking to some pretty bright consultants that are chomping at the bit to get away from having to make excuses and write hacks to make Google Analytics do stuff it is not designed to do (screen scraping, really?!) and use a more full-featured application.
It’s not that Google cares all that much I suspect; rather I think they’re more than happy to have a real competitor in the free market, especially one that offers a logical “step up” from the basic functionality that Google Analytics has to offer. I won’t be surprised at all if Brett Crosby publicly welcomes Yahoo! (back) into the web analytics arena in the same way he welcomed Microsoft to the game last year at Emetrics. I’ll be less surprised if Google’s Analytics Evangelist has a happy post about IndexTools sometime this week, especially given his historical evangelism for IndexTools and professed respect for Mr. Mortensen.
The real challenge I see on the horizon is for the paid service providers, especially those focusing largely on the mid- to higher-end of the market (which is to say everyone.)
Consider the following:
- Like it or not, IndexTools is pretty much as good as most of the best analytics offerings out there today. It may not be as pretty, it may not be as “AJAX-y”, it may not be as fast, but this is an offering that goes toe-to-toe with the “mass market” analytics offerings from all the major vendors and in my opinion is every bit as good. Why would I say that? Simple, I have been running IndexTools on my web site for the past six months. IndexTools is not easy, but it is no more complicated than anything else out there (IMHO.) If you look around at comments and what some people are saying you’ll head the same thing over and over: Companies of all sizes have been selecting IndexTools for years based on rich, comparative functionality made available at an affordable price point. IndexTools has great filters, great segmentation, great custom report building tools, great extras like color coding, notes, and dashboards. Did I mention it is now all available for free?
- The complaints about IndexTools are, for the most part, underwhelming. One (nameless) vendor has said that IndexTools is inferior because it wasn’t included in the last Forrester Wave and JupiterResearch constellation. The same vendor said that IndexTools is inferior because someone else said most of their clients are SMBs. The same vendor tries to created FUD around the data center being in Eastern Europe. The same vendor says that IndexTools doesn’t have “deep domain expertise” or “specialized services” The problem is that A) both Forrester and JupiterResearch focused only on U.S.-based vendors and (I believe) excluded IndexTools based on geography, not functionality, B) IndexTools does have some very large clients (Vodafone, PriceRunner, Tesco, ToysRUs — read this interview with Dennis Mortensen for details), C) I suspect Yahoo! will be doing some work on the data collection and reporting architecture over the next few months, and D) IndexTools is very likely to follow Google’s model of relying on external web analytics experts to provide expertise and specialized services (YAAC, right?)
- The valid complaints about IndexTools are either being addressed currently or are likely to be addressed very shortly. Phil Kemelor from Semphonic who also does some work for CMSWatch has looked at the major analytics applications perhaps more than a normal human being should in the process of writing his really, really big book on web analytics tools. Regarding IndexTools, Phil said the following:
“IndexTools does not offer the functionality that distinguishes it from Omniture and WebTrends — for example the ability to analyze unaggregated data from a graphic UI and to perform repeatable Excel reporting. For now, you must use regular expressions to analyze unaggregated data and do manual updates of Excel…just like Google Analytics.”
Good assessment, Phil, and a reasonable critique of IndexTools except. I would only offer that all the major vendors require add-on applications to analyze truly unaggregated data from a graphic UI (Omniture Discover, WebTrends Visitor Intelligence, etc.) and on this point IndexTools has already showed quite a lot of people “Rubix” which is the inevitable response (and which I sincerely hope that Yahoo! decides to release, even if they make us pay something for it.)
Personally I think that the ability to analyze unaggregated data should be in a separate interface, one designed for expert users working in the web analytics hub, and that IndexTools following the SiteCatalyst/Discover, WebTrends Analytics/Visitor Intelligence, NetTracker/NetInsight, etc. model is the right decision.
Regarding the “repeatable Excel reporting” … in my interface under “Settings” I have something called “Scheduled Email Reports” that seems to work pretty well. I can add a bunch of reports and schedule them for delivery in whatever format I choose; It’s not exactly what I want (having used HBX Report Builder, still the gold standard for Excel integration IMHO) but it certainly fills an important need for web analytics practitioners. This may be an IndexTools 10 feature that I am a BETA tester for, which may explain the confusion …
Finally, I would personally offer that Google Analytics and IndexTools are (in their current state) dramatically different applications targeting very different audiences. I am sure to take endless shit for this but I believe that Google Analytics is a great entry-level tool, something designed to seem “easy” and get folks used to the idea of doing web analytics on a professional level; IndexTools is not a great entry-level tool, rather it is a rich analysis engine that is the next logical “step up” from Google Analytics for practitioners and companies needing robust segmentation, customization, and drill-down capabilities.
Don’t believe me? Go to Google Analytics and create the following segment then apply it to your most commonly used reports:
In the body of the document, which I hope I am okay quoting a little bit from, Phil also says (and I paraphrase) that IndexTools strengths include “on-screen drill down detail in reports; ad-hoc analysis features; dashboard presentation and customization” and that in addition to the weaknesses listed above, that a weakness is that IndexTools requires the “manual entry of distribution list recipients.”
Those of you who have seen Phil’s book know that he has done an absolutely amazing job summarizing the strengths and weaknesses of each tool. In his conclusions, Phil has says the following:
“IndexTools should receive consideration if you want a well-priced, commerce-focused reporting solution and do not want to pay Omniture, WebTrends, or Coremetrics prices. If most of your users are part-time analysts and marketers who basically need reporting, IndexTools may be a reasonable selection. If you require complex slicing and dicing, IndexTools should still be on your list. Automated data integration and multiple sites with huge volumes of traffic and multiple campaigns may present challenges to IndexTools. However, because the company has a history of accommodating custom requirements, you should consider the possibility of IndexTools meeting your needs even though you want something outside of their standard feature set.”
My interpretation of this is more or less “look at IndexTools” as part of your consideration process. There are instances where IndexTools may not be appropriate — absolutely true, no application is all things to all people — but if you compare the assessment above to the conclusions provided for Omniture and others I think you’ll see a favorable recommendation for IndexTools (at least I did.) If you’re interested in reading the rest of what Phil had to say, I strongly recommend buying a copy of The Web Analytics Report 2008 from CMSWatch.
Some things are missing in IndexTools 9, mostly the ability to create custom metrics (something I have become pretty used to in Visual Site), and a couple other minor things I like to see in a mass-market analytics solution but I think there are quite a few people who will be willing to look the other way on small points like this given the price point. My basis for saying this? Simple, a rumored 1.2 million Google Analytics deployments and the army of people willing to look the other way regarding the limitations in GA …
Which brings me to why I believe IndexTools is a permanent game changer:
- The paradigm shift I cited in my last post on the subject is going to happen a lot sooner than some people thought. Now, if you know an IndexTools partner, or soon if not, companies really don’t have to worry about the vendor selection process. If you’re new to web analytics you can get Google Analytics; if you’ve pushed past the limited functionality in GA, you can get IndexTools. Total cost for tools: nothing. Companies will be able to (finally) focus on how the tools are used and the process of doing web analytics, not haggle with vendors over pricing, fight with IT over implementation, etc., which is exactly where we need to be. Web analytics is not about the tools, web analytics is about how the tools are used to improve the business.
- The existing for-fee vendors have been served notice and will have to figure out a better sales proposition than “the competition sucks.” I’m willing to be wrong on this point, but I don’t think the current “anti-IndexTools” messaging I’m hearing is likely to hold up under scrutiny. Eventually buyers are going to realize that they’re talking to sales people, some of whom are somewhat integrity-challenged, who will say anything to get them to look away from Yahoo’s offering. This rocks, in my opinion, because it spells the end of the negative selling that has been a hallmark of some vendor’s capabilities. Let’s focus on what makes you truly different, given that I can get something very similar for free, huh? As far as the claim that IndexTools sucks because the analysts don’t cover it? Um, are you sure?
- For the existing for-fee vendors to continue to thrive, they will need to move quickly up-market and focus on the needs of a very sophisticated audience. This is really very interesting since it highlights a growing schism between vendors trying to own the Enterprise and those trying to play nice with others. Don’t know what I mean? Look around for things like “Closed-loop Marketing” and the implication that you should be bringing all your Enterprise data into your web analytics system; compare that messaging to the idea of open architectures and the notion of integrating appropriate web analytic data back into the rest of the business. In fact, now that the pricing battle is coming to an end, I think that this is the next really interesting conversation we’re going to have …
So we start to focus on the application of the tools, not the tools themselves. Game changing. The vendors are forced to refine both their offering and their sales process. Game changing. Consultants have better free tools to work with. Game changing. Web analytics technology is pushed further along towards being a commodity. Game changing.
I’m not one to make a bunch of predictions, but I would challenge those of you who disagree with my assessment to set an alert in your calendar for twelve months from today. When the alarm goes off, take a look at the adoption rate for IndexTools, the trading price for OMTR, and the ownership status of the remaining privately held web analytics vendors in the marketplace today. Again, I am perfectly happy to be wrong about how IndexTools might change the market …
I should reiterate that all of this is not without risks: there is still a lot that could go wrong as Yahoo! integrates IndexTools into their larger offering: the team could become de-focused, key people could leave Yahoo, Microsoft could succeed in their take-over efforts, etc. (and yeah I remember Keylime too, but that was a different time, a different technology, and frankly a different group of people managing the process.) I am very impressed with what I’m hearing so far and look forward to the evolution of the entire web analytics sector, driven in part by Yahoo! and IndexTools.
Again, congratulations to the teams at Yahoo and IndexTools and, um, Merry Christmas to the few IndexTools partners who will have the market cornered on this technology for the time being.