ASPs Can Be Key in Online DM Strategy

Businesses can find themselves quite overwhelmed when faced with the decision to invest in an online direct marketing solution. You can choose from Web-based applications, hosted applications, service bureaus or an application service provider.

There are more than enough solutions to choose from, and we need to do a better job demystifying the hosted model.

The problem is differentiating between them and knowing if you need a hosted application, or if you should buy a packaged application and bring it inhouse. It’s not as difficult as it seems, but it takes some knowledge to determine which solution is best. The most useful course would be to measure the business benefits you are likely to achieve and map them to a tangible return on investment.

Here are three general approaches:

• Build the system inhouse. This is the first alternative that usually comes to mind and it frequently begins as a modest project. But it tends to grow very quickly. Even the simplest of projects require a year of effort before reaching mission-critical quality. Companies rarely have the inhouse expertise to replicate the robust interaction features pre-existing solutions offer. And even after this, significant time and effort is needed to maintain, tweak and upgrade the system.

• Buy a packaged application and customize and maintain the application yourself. This is the approach many companies take based on perceived economies of buying vs. building, or if they do not have the expertise inhouse. However, they need to take on the responsibility for running and maintaining the system on an ongoing basis.

• Subscribe to an application service provider. In this case, you can immediately use mission-critical software to create, launch and monitor the results of your own campaigns without having to take on the burden of maintaining and running the software. Unlike packaged applications, delivered with a fixed feature set and infrequent upgrades, this service has the ability to frequently incorporate customer-requested features.

It’s most likely that online marketing is a mission-critical application for any e-business. With this in mind, the solution must meet certain requirements. Can it scale to meet the company’s needs? Take an e-retailer that has a holiday promotion and wants to increase e-mails from 100,000 to 3 million. Will the system avoid downtime, server errors and failed delivery? What is the budget for investing in infrastructure, licensing, fees, upgrades and IT personnel? If there is a need for scalability, reliability, low cost of ownership and fast deployment, then companies may want to consider the ASP model.

An ASP is an independent third-party provider of software-based services that delivers to customers across a wide area network. Such services could include e-mail marketing capability, or a customer relationship management application that tracks call center leads or site visitors.

So, you won’t need to install the application at your own site, you just need to pay a monthly fee and have a Web browser to access your data and the application. Since you are outsourcing the application, you can redirect resources that may have been spent on IT personnel toward marketing personnel. The marketer now has control over the creation, launching and management of online marketing without worrying about the IT. All the technical work is taken care of by the hosting company.

The benefits of using an ASP are overwhelming. However, do your homework first before selecting your ASP. More and more companies are positioning themselves as ASPs, so make sure you understand what you require and what the ASP offers.

Security and reliability are essential in any ASP. Make sure your ASP provides you with a confidential agreement if you are concerned about data security and privacy. The perception is if you outsource your online direct marketing, you lose data security. This is not typically the case; a reputable ASP will not have access to your data and may provide for your data to live on your site but still be accessed by the vendor’s service bureau.

Does the ASP offer 24-hour, 7-day-week uptime? Or is it a fault-tolerant site, including data and network redundancy, to guard against single point of failure? It should have disaster protection mechanisms, including smoke and heat detectors and a pre-action sprinkler system.

Any e-business that is on Internet time will find the ASP model attractive. Time and energy gained from implementing the ASP model will afford companies the opportunity to tackle other projects, such as customer retention and loyalty programs.

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