SAS Puts the “E” in “Data”

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Event Summary

SAS Institute, Inc., the largest privately held software company, introduced a family of "E-intelligence" products that provide analysis of the data collected at a website. Although the announcement covers three products, the SAS strategy is to present a solution that encompasses all of the data mining needs in a large enterprise.

The WebHound product is a high-end clickstream analysis product. It analyzes the paths taken by customers viewing a website and can both produce standard traffic reports and answer ad hoc questions about the behavior of individuals or groups.

E-Discovery is a data-mining product that can integrate information about Web behavior with other information from across the enterprise. This product uses a number of data mining techniques such as collaborative filtering and neural networks, so that in addition to answering specific questions it can point out patterns that might not have been recognized or asked about.

The third member of the suite is IT Service Vision, a previously existing product that can report on server performance and problems.

The three products are based on existing SAS products to which the ability to parse and analyze web logs has been added. The core of the company's strategy to offer what they call a "closed-loop E-infrastructure" is E-Discovery that has the data mining capabilities of existing SAS products such as Entreprise Miner. E-Discovery can be used withWebHound or other log analysis programs to find patterns in the data that are not identifiable from logs alone. Such patterns might be that users who visit pages A and B also tend to visit pages C and D, or that users who purchase baby oil and are shown ads for diapers are likely to purchase both diapers and intimate apparel. E-Discovery can take into account the historical traffic patterns and any demographic information a site has; it can return real time characterizations of surfers that can be used to personalize pages or target ads.

According to the company its three key differentiators - integration capability, the ability to deal with multi-channel data, and scalability to arbitrarily large data collections - are fully reflected in these E-intelligence products.

Market Impact

The company has little interest in selling WebHound competitively against WebTrends or similar tools. The smallest sale that would be of interest to them is one that bundled WebHound with E-Discovery. A product like this would compete with other web-base data mining products such as those from Accrue and NetGenesis. We do not believe that there will be a strong marketing push aimed at smaller companies for which a product that analyzes only web data is sufficient. In particular, we don't expect that the typical will be visited by a SAS salesperson.

The company is instead looking to sell the product into clicks-and-mortar companies that have a variety of data channels that must be combined for analysis. The target market is an enterprise-wide sale. E-Discovery will be an easy sell into existing SAS customers who are already familiar with the company's abilities with managing and analyzing large quantities of disparate data. Success there will fuel success in a wider sales effort.

Of course, SAS's competitors - SPSS, MathSoft, and especially IBM - have or will soon have their own competitive entries.

User Recommendations

We believe that identifying user trends and behaviors is one of the absolutely most critical things that a website must do to survive. If you don't know exactly what kinds of data you want to collect and how to use it, then any of a family of similar products will almost certainly be appropriate - and much more cost effective than the hand-crafted system that your programming staff has offered to whip up.

As we noted, there is no compelling reason to look at WebHound if your only interest is daily log analysis. If you intend to mine current and historical web data then the combination of WebHound and E-Discovery may be worth a look. Note that there are significant feature differences between products that are intended to mine data from web logs, starting with source data.

SAS and WebTrends take data from web logs, whereas products from Accrue and NetGenesis can capture data at a deeper network level. Some sites, more typically the technically savvy dot-coms will appreciate the advantages of this, such as showing when people cancel the loading of a page, something that cannot be determined from web logs. Some products have add-on features; NetGenesis, for example, has one that is optimized for sites that use shopping carts.

We therefore strongly recommend a very careful selection procedure to identify all the ways that clickstream data can be used, either by itself or in conjunction with other enterprise data. Unfortunately, the richness of the data that are available means that the kind of traditional thinking that marketing and IT people bring from their past experiences is not a good guide for a forward-looking set of requirements. Unless someone on the selection team has experience with web traffic analysis it would be a good investment to bring in some consulting assistance for requirements definition before purchasing any analysis product.

The companies that should definitely take notice of this are the ones that need to integrate many other streams with their web data. For these companies SAS's track record makes putting the E-intelligence suite on their short list an absolute necessity.


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