Coremetrics prepares for IPO

Despite the fact that some of the biggest names in computing offer web analytics services for free, according to Shawn Farshchi, chief operating officer of web analytics provider Coremetrics, it is nevertheless one of fastest-growing application sectors in the enterprise environment, ahead of finance and CRM systems.

While free services such as Google Analytics and Yahoo! IndexTools let companies dip a toe in the water, integrating online data with offline data, particularly point-of-sale data in a retail environment, is the major growth area at the top end of the field, he says.

“We’re working with a large retailer in the USA to encourage consumers to register on the site before coming into the store,” says Farshchi.

“When they walk into the store they can send a text message, and based on the caller ID and their past behaviour they’ll be sent a discount code. The company wants to make sure you buy something once you’re in the store,” he says.

Coremetrics’ major competitor is Omniture, also a software-as-a-service company and one that has enjoyed meteoric growth in the sector. But according to Farshchi, “they have a big challenge in front of them”.

“They acquired multiple companies in a short space of time, so they have four different groups and no single view,” he says. “When we come face to face in any deal, we win 70% of the time – and we never compete on price.”

Operating on a software-as-a-service model, at a basic level Coremetrics stores a cookie in a customer’s browser containing a number that is used to track their behaviour across a site for a maximum of 25 months. This data is stored online in a live data warehouse that Farshchi describes as the company’s “crown jewel”.

“Our data warehouse is very sophisticated, stores a petabyte of data and is updated every day. The web analytics engine sits on it, and on top of that are the digital marketing applications,” he explains.

Following a $60 million investment led by global investment group 3i, Coremetrics is also planning an IPO for next year, Farshchi says.

He hints that the capital will be used to fund acquisitions and boost functionality in areas such as sales and lead management, and behavioural targeting. “I don’t foresee us being the largest, but rather the most effective,” he says.

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