1996 Nov 01

Epsilon Epsilon Campaign Manager
David M. Raab
DM News
November, 1996

1996 has seen a bumper crop of open-systems campaign management software. It’s as if everybody had spent the past three years working secretly in their garages and then proudly wheeled their creation onto the driveway–only to look up and see their neighbor rolling out a virtually identical contraption at the exact same moment. Didn’t Dr. Seuss write a book like this?

These systems all run on relational databases, use standard Microsoft Windows graphical user interfaces, and perform the same basic function of allowing users to select groups of customers for promotions. The newer ones even share the “tree” or “flow chart” metaphor for splitting a file into ever-finer segments. How to tell them apart?

In fact, the differences are considerable. One high-level distinction is whether the vendor uses special technology to improve the data loading and response time for very large relational databases. Products including Dun & Bradstreet Information Services Market Spectrum, dbINTELLECT Technologies Marketing Database Toolkit, Mercantile Software Systems Inc. IRE Marketing Warehouse and Saxe Inc. Empower all take this approach. Another set of vendors has focused on enterprise-wide campaigns that extend to multiple steps over time; multiple channels such as mail, telephone, field sales and the internet; and multiple departments such as sales, customer service and product support. These include IBM/Customer Potential Management Target, Customer Focus International MKS Marketing Information System, Admiral MIND and Prime Response Vantage. Some vendors are distinguished by a specific industry focus, such as Group 1 DataDesigns (hospitality), S2 Systems Inc. CRM Marketing Database (grocery stores), STS Open MarketWorks (retailers) and Treasury Services Inc. Harvest (banks). Others use smaller scale database engines, including Unibase Direct PC-Navigator (FoxPro), Paradigm Ovation (Paradox), Miglautsch Marketing Migmar (Interbase) and Centrax Marquis (Visual FoxPro).

After setting these cases aside, several general purpose campaign management products still remain. Decision Software TopDog provides tightly integrated query, selection, analysis and reporting tools that are molded to each customer’s business process. Exchange Applications ValEX combines its own query and selection tools with third-party reporting and analysis and offers a business methodology that customers can adopt or not.

Epsilon Campaign Manager (Epsilon Data Management, 800-225-3333; 617-273-0250) is another version of a general purpose, open systems campaign management product. Epsilon, a database marketing firm that provides systems integration, service bureau processing, marketing strategy and analysis, chose to use third-party tools for queries as well as reports and analysis. This limited its development effort to tasks that are particularly difficult for standard relational database tools, such as ranking and random sampling, and to the tree-based interface needed to manage complicated selection schemas.

Epsilon’s approach lets users stick with their current query and analysis tools and use their existing database structures and maintenance procedures. But it also means that response analysis, usually an important element in a marketing database system, is not built into the product.

The key to Epsilon’s strategy is a strict division between the query functions that select records for a marketing campaign and the segmentation of those records into differently-treated groups. While nearly all campaign management tools use a filtering query to define the campaign universe, Epsilon actually places the “audience pool” in a separate database and then performs all additional segmentation against it. Since the audience pool has fewer records and a simpler structure than the main database, it is considerably faster and easier to work with. The main disadvantage is that users can only segment on variables they thought to include in the original extract. When the extract includes data from more than one level, such as individuals and transactions, Epsilon’s software will automatically create and link the appropriate tables in the audience pool database. The same field names and descriptions appear in the audience pool and the main database.

Once the audience is created, the user builds the actual segmentation tree by defining parent and child nodes in as many levels as required. The qualifications for each node can include multiple variables, although some complex activities–such as ad hoc counts of specified transaction types–are not supported.

Records can be distributed into child segments by ranking into groups such as a deciles or by using Nth or random samples to select a fixed quantity or percentage. Records are selected only once, in the first node for which they qualify. Selections within a node can be made by individuals or limited to one name per household.

Users can execute the tree at any time during the development process and get back counts for each node. Users must generate an output list to see the actual records selected for a node, however. According to Epsilon, a 30-node tree with a 1.5 million record audience executed in 46 minutes. This is after the audience pool has been created, which can take several hours on a file with tens of millions of records. After a tree is executed the first time, the system will run faster on subsequent counts because it will only recalculate values for nodes that have changed.

The user can assign audience, channel, version and other codes to each node, using categories defined during the system installation. The system will post these codes to a promotion history file in the main database after the selection is complete. In addition, each node can be assigned one output format. This will appear as an ASCII file and can include database elements that were not copied into the audience pool. Different nodes can have different formats.

Response analysis and other reporting are either custom written or performed outside of the system.

Pricing of Epsilon Campaign Manager is set at $150,000 for six named users or three concurrent users, with additional named users priced at $10,000 each. Annual maintenance costs 25% of the license fee. Customization, which involves linking to the user’s marketing database, production environment and query tools and creating some initial reports, is expected to cost $50,000 to $100,000 per installation. Epsilon Campaign Manager was introduced in mid-1996 and currently has four live installations. It runs on any version of Microsoft Windows or Apple McIntosh workstation and on standard Unix servers.

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David M. Raab is a Principal at Raab Associates Inc., a consultancy specializing in marketing technology and analytics. He can be reached at draab@raabassociates.com.

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