Coremetrics, one of many analytics companies trying to help website owners understand and market to their visitors, has raised $60 million in a fifth round of financing.
Back in 2006, we said there was some real demand in this area, but probably not enough to support all the companies that were springing up. Coremetrics, however, seems to be getting some real traction, which chief executive Joe Davis attributes to building sophisticated marketing tools — such as search engine bid marketing, email marketing and cross sell applications — on top of the basic analytics features.
Most analytics services, such as Omniture, are really designed to aggregate data about the overall patterns of site behavior. Coremetrics, on the other hand, functions as a “data warehouse” of information about each visitor, and helps you market to those visitors, Davis says. Using Coremetrics’ default package, companies can find out everything they want to know about an individual. If companies want that kind of data from the competition they have to constantly formulate and reformulate their queries — and with Coremetrics’ competition, the data collection starts anew each time, Davis adds. There is also some data that competitors just can’t get, such as a visitor’s behavior across multiple sessions.
For example, Davis says, most analytics companies will tell you that say, 20 percent of your customers put an item in their shopping cart and then abandoned it. Coremetrics can tell you who those 20 percent of people are, by gathering that information from email addresses, for example. Companies can use that information to market similar products to those customers later.
The analytics field has been winnowed down since we last took a close look, Davis says: Omniture is doing well with its paid service, and Google Analytics is popular on the free end, but most other companies — such as Webtrends — are struggling or have disappeared. Davis says Google Analytics actually functions as marketing for Coremetrics, because Google users understand the importance of analytics, but also see its limitations and are often ready to pay for additional tools.
Coremetrics’ customer base grew by 46 percent in 2007, and the company achieved profitability at the end of the year, Davis says. The San Mateo, Calif.-based startup was gearing up for an IPO when the market (and the economy as a whole) started struggling. Now the company is focused on growth instead, and may make some acquisitions in behavioral marketing and multivariate testing to expand its offerings. With the planned expansion, Coremetrics will go back into the red and likely stay there for the rest of the year, Davis says.