TreeHouse Interactive Digs Up the Roots of ROI
In an economy where you're either slashing your prices or finding a way to differentiate yourself, TreeHouse Interactive, a provider of partner relationship management (PRM), channel sales force automation, and demand generation solutions, has decided to aim for the latter.
"The challenge I gave my team five months ago," says Erich Flynn, the company's chief executive officer, "was look at the market and try to find a place where we can have first mover's strategic advantage." What they found, he says, was a gap in connecting campaigns with a return on investment (ROI). TreeHouse's Marketing View solution targets this problem by hard-coding the campaign source information to every lead, regardless of where the lead goes (e.g., to a salesperson internally or out to a partner portal).
Traditionally, the link is often broken once leads make the transition from marketing to sales, Flynn explains. Once the lead has been passed to a separate sales or CRM system, or into reseller portals, it becomes all the more difficult to determine -- to the dollar -- where leads came from and what campaigns performed best. In order to get the ROI piece, he says, TreeHouse had to solve lead distribution component, which required integration with other CRM packages -- the company announced its integration with Oracle CRM On Demand last September and just recently announced the availability of its Marketing View marketing automation product on the Salesforce.com AppExchange.
Marketing View customers can also connect directly with the company's more basic sales force automation tool, Sales View. With Sales View, Flynn says, TreeHouse naturally has more control over the product and can also provide more detailed campaign analysis (e.g., when an email is opened, click through rates, contact response rates). The goal, according to the company, is to become CRM system agnostic.
Beyond software integrations, China Martens, senior analyst of enterprise software at The 451 Group, anticipates TreeHouse will need to establish "formal partnerships" that will, "not only to give them more validation in the market but raise their profile." A partnership with Oracle may be a natural move, she says, considering Oracle just lost BlueRoads, a PRM vendor once a part of Oracle's PartnerNetwork Program but was recently acquired by CSG Openline in late February.
"It's a different approach," Martens says. She notes, in particular, their approach as a more channel-focused solution provider, as opposed competitors like Eloqua that concentrate on measuring ROI by establishing a "marketing threshold" for campaigns. "Most CRM apps were built from a direct sales perspective initially," she adds. "The needs of partners [were] added later." What TreeHouse does is start with lead generation and working from there to keep the lead and campaign source intact, which becomes particularly challenging when working with partners. It's because of this strong partner-channel focus in Sales View that Martens is particularly interested in this company. "That's an area where -- on the PRM side, sales force automation side -- certainly there's something missing there [in the industry]," she says.
Current sales and marketing automation tools on the market, Flynn says, drop the ball, or have limited capabilities, when it comes to maintaining the link between sales and the campaign. Sales team members typically have to manually enter campaign information into the system. "If you've ever talked to a sales person," he says. "This isn't something they're focused on. They're focused on making their numbers." The challenge is further augmented when dealing with partner channels and e-commerce models.
"They've gotten the lead generation bit hardened," Martens says. "They're able to come at it fresh." Competitors, Flynn says, associate ROI as a percentage of marketing qualified leads, but don't attribute them to actual sales dollars. To be able to make the connection, he says, is critical to budgetary conversations with c-level executives. Only with hard dollars can marketers determine how much money was generated from which campaign, and which campaigns -- with perhaps a tweak -- can garner incremental benefits. "The only way I can do that," he says. "Is by having the history of dollars behind it."
As Flynn explains it, TreeHouse "hardcodes" the lead campaign source link to the lead and automatically populates information from the lead into the system. The tool is designed to measure campaign results from a variety of channels -- direct mail, telesales, and most popular, email. Moreover, a configurable dashboard allows marketers to compare results and performance across campaigns. A lead scoring and search function prioritizes both potential customers and existing customers who may be due for a follow-up. For instance, marketers can create an combination of parameters using purchase data that can target customers who haven't purchased in the last six months. This tool, Flynn explains, is helpful in nurturing viable customers or winning back customers who were lost along the way.
In terms of analytics, TreeHouse's Marketing View solution falls behind marketing automation competitors like Eloqua, Martens says. What TreeHouse needs, she suggests, is to partner with vendors like Web analytics provider Omniture (Eloqua, she notes, has both a strong partnership with Omniture and its own analytics offering.)
The marketing automation space is an extremely hot market, especially now as companies are tightening their metrics. "It's such an insanely competitive area," Martens says. "Everyone's moving in on it and the folks waiting to move in more aggressively are the major CRM players." The company has certainly made inroads in the industry, especially after only coming out of "stealth mode" last September, she says.
While TreeHouse reaches a wide range of customers given with three separate market applications (Reseller View, Sales View, and Marketing View), Martens also sees it as a challenge. "Most of their customers so far take one or two of their [applications]," she says. "Not all three." As a small, privately owned company, she warns against TreeHouse investing too much of its "scant resources into Marketing View," especially given competition. Moreover, Martens wonders if as a result of this competitive environment, TreeHouse's message, "gets a bit diluted."
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