2017 North American AI-based Cross-Channel Marketing Automation New Product Innovation Award

Transcription

1 2017 North American AI-based Cross-Channel Marketing Automation New Product Innovation Award

2 Contents Background and Company Performance... 3 Industry Challenges... 3 New Product Attributes and Customer Impact... 3 Conclusion Significance of New Product Innovation Understanding New Product Innovation Key Benchmarking Criteria Best Practices Award Analysis for Kahuna Decision Support Scorecard New Product Attributes Customer Impact Decision Support Matrix Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices The Intersection between 360-Degree Research and Best Practices Awards Research Methodology About Frost & Sullivan Frost & Sullivan We Accelerate Growth

3 Background and Company Performance Industry Challenges Increasing digitization trends across industry sectors and end-user groups have unleashed an ocean of opportunities for marketers to connect with potential target segments via next-generation marketing campaigns. Marketers draw upon a wide range of digital marketing platforms to automate delivery of campaign content to consumer groups such as s, text messages, and push notifications to reach consumers and engage them in exploring new products and services. Although this technology-driven approach has made digital marketing activities easier to an extent, results have proven less than satisfactory as the automated solutions fail to deliver the desired level of engagement from consumers, and, as a result, consumer responses tend to decrease over time. This trend is easily measured by open rates, click rates, and consequent conversion rates. For mobile-based engagements using push notifications, in particular, continuous receipt of irrelevant and untimely content results in utter dissatisfaction and finally uninstallation of the offending application. End users are often found to post negative reviews based on annoying push notifications. One of the prime reasons why these solutions fail to deliver results is that they are incapable of accurately segmenting consumer groups and end up with broad generic segmentations. This leads to sending irrelevant content to consumers. Additionally, the high frequency and ill-timed delivery of the notifications results in consumer discontent. Another key challenge for automated digital marketing solutions is that they are channel specific. These solutions lack cross-channel communication and engagement capabilities, which is essential as engagement-channel preference for consumers varies with every individual user during different times of the day. The need for intelligent marketing automation capabilities coupled with seamless cross-channel engagement features is the need of the hour to empower marketers with better engagement results among consumers and to increase conversion rates for digital marketing campaigns. To address these challenges, California-based Kahuna has developed the Kahuna Platform, an artificial intelligence (AI)-based cross-channel digital marketing automation solution. New Product Attributes and Customer Impact Positioning Frost & Sullivan research finds that the prime differentiating factor that keeps the Kahuna Platform ahead of the competition is its delivery of cross-channel digital marketing automation capabilities. In contrast to competing solutions that are channel-specific, that is, capable of sending content through either , text message, or push notification on mobile, the Kahuna Platform offers a common platform to engage consumers on every Frost & Sullivan We Accelerate Growth

4 digital channel. The solution is equipped with a proprietary Optimal Channel feature that analyzes consumer behavior data and determines the best engagement channel to reach them. Unlike competing solutions approach of following a generic route pertinent to channel selection guided by a rudimentary set of rules, the Kahuna Platform is capable of identifying patterns in behavior of individual consumers and understanding their preferred channel of engagement. If an individual consumer demonstrates a tendency to respond to push notifications more than text messages and s, the intelligent solution will identify this pattern and focus on sending more push notifications to that particular user. This platform function has played a significant role in increasing consumer engagement pertinent to the marketing campaigns of Kahuna s customers. Another key feature that makes the Kahuna Platform superior to competing solutions is its Optimal Path feature. Instead of trying to create a generic path with subsequent plans of action, the Optimal Path feature automatically creates and predicts the ideal path for each individual consumer or consumer group based on their behavior. This feature helps marketers with recommendations of the best ways to nudge consumers along the right path of the consumer journey. Leveraging activity data of each individual consumer, the solution is capable of identifying the best possible ways of engaging them. This approach successfully leads Kahuna s customers to target their consumers with the correct and most relevant content that succeeds in garnering attention. Frost & Sullivan We Accelerate Growth

5 For instance, one of Kahuna s customers operating in the ecommerce space identified a typical behavioral trend among consumers who would check out the product details section before making buying decisions. The feature revealed that these particular consumers are interested to learn about return policies, shipping rates, and related information. This insight helped Kahuna s customer identify consumer interests and design its marketing campaign to effectively nudge consumers along the right path in the consumer journey. Instead of manually guessing customer interests and following a generic path with periodic irrelevant information and offers, the Kahuna Platform helped its customer send personalized content that resulted in a positive impact in conversion rates. The third significant feature that keeps the Kahuna Platform ahead of its competition is the Optimal Send Time detection capability. Competing solutions usually send marketing content to large consumer groups with generic time profiles, such as in the morning or in the afternoon. This approach usually fails to capture the attention of consumers as they might be busy during those times of the day and do not bother to check the content. The Kahuna Platform, by virtue of its strong AI-powered capabilities, can analyze the user engagement data for each consumer and detect the time of day when the consumer is Frost & Sullivan We Accelerate Growth

6 most likely to respond to a notification. In other words, the solution is able to perform granular analysis on consumer behavior patterns and determine the most propitious time of the day to send marketing content. Kahuna s customers have found that this feature has significantly helped increase consumer engagement and conversion rates. Design The solution s superior technology and architecture play a key role in offering the best-inclass cross-channel digital marketing automation capabilities to customers. The Kahuna Platform has been designed with three prime functionalities. On the first level, the solution collects granular information on every consumer activity. The solution can be seamlessly integrated with the customers websites and mobile applications that allows it to collect events and attributes. Events record consumer activities and behavior and attributes record consumer traits e.g. an event can be viewed an item and attributes can be Male, Age 30, resident of California. The solution is capable of processing billions of events and attributes at scale. In the second level, the solution creates very rich profiles for each consumer. These profiles, based on consumer attributes and events, are provided to Kahuna s customers to help with segmentation and to run their digital marketing campaigns on either an individual basis or in aggregate. Frost & Sullivan We Accelerate Growth

7 The third level is where AI comes into play. The solution is powered by a number of patent-pending machine learning-based techniques. Kahuna has developed various algorithms and machine learning models to enable its features. For determining the optimal time to engage the consumer, it leverages the statistical technique of binning, which assigns counters for each consumer engagement activity and through clustering identifies the best time of day to engage individual consumers. For determining the optimal channel, the path and message variants, it employs a multi-armed bandit machine learning model. This granular and self-learning approach implemented in the Kahuna Platform allows the company s customers to send personalized marketing content to consumers that significantly increase chances of engagement. Quality Kahuna dedicates immense effort to ensuring it delivers superior results for its customers by enabling best-of-breed cross-channel automated digital marketing abilities. For a solution of this class, quality is reflected in proof points pertinent to the growth in control groups, meaning consumer groups loyal to applications and websites who frequently use the services. For instance, one of Kahuna s customers, TickPick, a ticketing marketplace, has experienced significant profit margins by using the Kahuna Platform. Kahuna s technology has helped the company attain a 100% revenue growth year-over-year (YoY) since Use of the Kahuna Platform contributed majorly to TickPick s recognition by Inc. 500 as one of the top 100 fastest-growing private companies in the United States. When TickPick ran its consumer retention campaign using the Kahuna Platform, it saw a 91% lift in goals completed; compared to a control group goal achievement of 3.37%, the consumers who were messaged using Kahuna s platform had a 6.43% goal achievement rate. In another campaign, Kahuna helped TickPick increase the conversion rate from 0.34% to 0.45%. This 33% lift was quite significant for TickPick considering that it was a broad campaign and resulted in significant revenue gains for the company. The prime objective given to the Kahuna Platform was to determine the most relevant content to send to specific target segments. Yummly, one of the fastest-growing recipe recommendation platforms, was facing significant challenges pertinent to retention of new users. Aided by the Kahuna Platform, Yummly identified significant gains as it discovered its new user engagement, new user retention, and new user conversions had increased by 43%, 119%, and 1,300%, respectively. One of the prime forces behind this whopping growth experienced by Yummly was a highly personalized onboarding experience through accurate consumer profiling and segmentation powered by the Kahuna Platform. These proof points clearly reflect the qualitative superiority of the Kahuna Platform that results in creating high value for its customers. Reliability The high reliability aspects of the Kahuna Platform have helped the company grow its customer base exponentially within 5 years since its inception. The solution s capability to optimize cross-channel digital marketing campaigns with highly relevant, timely, and personalized content has been a key factor in elevating the solution s reliability quotient. Frost & Sullivan We Accelerate Growth

8 Customer testimonials that include TickPick, Yummly, Listia, Scondoo and Mudah, among others, illustrate that major businesses rely on the Kahuna Platform for maximizing the conversion rates of their marketing campaigns. The innovative Message Optimization feature included in the Kahuna Platform is an important contributor to solidifying the solution s reliability. This feature allows Kahuna s customers to evaluate and compare multiple variants of marketing content, and then the solution recommends the most suitable ones based on the test results. The platform also offers the ability to dynamically modify the content to best suit customers requirements. An average of 73% increase in goal conversions observed by Kahuna s customers has been a key factor in influencing them to continue their reliance on the solution. Additionally, the strong technological architecture behind the Kahuna Platform has ensured close to zero downtime and reliability issues faced so far by the company. The cloud-based solution, architected on top of the Google Cloud Platform, can dynamically scale up or down the server and computing capacities based on customer requirements to ensure meeting their ever-changing needs. Price/Performance Value With its AI-powered cutting-edge automation abilities, the Kahuna Platform provides customers with a high return on investment, eliminating the need to manually define target segments and manage digital marketing content. This ability saves customers money in appointing such highly skilled professionals and eliminates considerable guesswork that otherwise leads to inaccurate targeting, thereby resulting in a direct financial gain. Additionally, real-time, accurate data-driven analysis empowers Kahuna s customers to roll out the most relevant content with real-time updates. Frost & Sullivan We Accelerate Growth

9 The Kahuna Platform has consistently created value for its customers and played the role of a positive catalyst helping to monetize their digital marketing efforts. One of the earliest customers, TickPick, has continued its relationship with the company on the merit of such high value the solutions create for it. With Kahuna's hyper-personalized messaging approach carried out by its AI and cross-channel platform, TickPick was able to solve a major business problem: onboarding. In using Kahuna to streamline its onboarding process, TickPick sent messages to new customers immediately (without the prior hour delay) and ensured those messages only contained relevant content each customer cared about at the individual level (as opposed to relying on generic communications). As a result, engagement levels increased which led to addressing another core business problem: conversion. TickPick achieved a 29% increase in tickets purchased when using Kahuna to message users with an incremental 3% increase in tickets purchased when using Kahuna's AI to optimize the time the messages were sent per the individual user. This resulted in a 29% increase in conversion campaign revenue. Due to the remarkable contribution of the Kahuna Platform that helped TickPick generate an increment of $41,000 in revenue from one campaign alone, the company entrusted the solution for a total of 332 campaigns in This clearly reflects that TickPick has reaped major bottom-line impact by transitioning to Kahuna's hyper-personalized messaging approach. Frost & Sullivan foresees that the solution, by virtue of its superior machine learning capabilities, will continue creating very high value for its customers in the future through significant increments in revenues generated from the hyper-personalized automated digital marketing content. Match to Needs Kahuna strongly believes that the connection between product companies and their customers is strengthened by active on-going communication between them. Kahuna s best practice of conducting regular communicative events with its customers has helped the company identify unmet needs and address them successfully. In particular, Kahuna has created a dedicated customer success team that works closely with its customers, including mandatory weekly meetings depending on each customer s preferred mode of communication. These meetings help Kahuna to deeply analyze the customers usage of its solution and learn about the challenges they face. The team also analyzes the approaches undertaken by its customers and recommends the best ones to most fully achieve their goals. For each customer, the team performs a granular analysis of the campaigns over the past week, evaluates the results, and then benchmarks them against other practices in the industry. Kahuna s customer success team also helps with segmentation approaches, content enhancement, and in running a test on behalf of a prototype campaign to check its early-stage responses. Following Kahuna s best practice of offering optimum support in using the solution, the product team often works closely with its customers, even to set up critical campaigns for them. Additionally, Kahuna collects periodic feedback about its product s performance. Key points obtained through feedback are considered by the product development team to add Frost & Sullivan We Accelerate Growth

10 new features, update the solution, and develop future roadmaps. Frost & Sullivan recognizes the exemplary dedication the Kahuna team offers in its best possible services to customers as a key factor that has helped the company grow and enhance the Kahuna Platform to become an industry leader in product innovation. Conclusion Kahuna has successfully made its mark as one of the leading innovators in the digital marketing automation market. The Kahuna Platform s AI-powered abilities to understand individual consumer behavior and preferences used to offer highly personalized marketing content that yields impressive conversion rates and revenue gains for its customers provide the company with a significant competitive advantage. The Kahuna Platform s cross-channel content delivery capability with the intelligence to identify the most preferred channel for individual consumers needed to achieve maximum penetration for its customers digital marketing campaigns has strengthened the company s position in the AI-based cross-channel marketing automation industry. With its strong overall performance, Kahuna has earned Frost & Sullivan s 2017 New Product Innovation Award. Frost & Sullivan We Accelerate Growth

11 Significance of New Product Innovation Ultimately, growth in any organization depends upon continually introducing new products to the market and successfully commercializing those products. For these dual goals to occur, a company must be best-in-class in three key areas: understanding demand, nurturing the brand, and differentiating from the competition. Understanding New Product Innovation Innovation is about finding a productive outlet for creativity for consistently translating ideas into high-quality products that have a profound impact on the customer. Frost & Sullivan We Accelerate Growth

12 Key Benchmarking Criteria For the New Product Innovation Award, Frost & Sullivan analysts independently evaluated two key factors New Product Attributes and Customer Impact according to the criteria identified below. New Product Attributes Criterion 1: Match to Needs Criterion 2: Reliability Criterion 3: Quality Criterion 4: Positioning Criterion 5: Design Customer Impact Criterion 1: Price/Performance Value Criterion 2: Customer Purchase Experience Criterion 3: Customer Ownership Experience Criterion 4: Customer Service Experience Criterion 5: Brand Equity Best Practices Award Analysis for Kahuna Decision Support Scorecard To support its evaluation of best practices across multiple business performance categories, Frost & Sullivan employs a customized Decision Support Scorecard. This tool allows our research and consulting teams to objectively analyze performance, according to the key benchmarking criteria listed in the previous section, and to assign ratings on that basis. The tool follows a 10-point scale that allows for nuances in performance evaluation. Ratings guidelines are illustrated below. RATINGS GUIDELINES The Decision Support Scorecard is organized by New Product Attributes and Customer Impact (i.e., These are the overarching categories for all 10 benchmarking criteria; the definitions for each criterion are provided beneath the scorecard.). The research team confirms the veracity of this weighted scorecard through sensitivity analysis, which confirms that small changes to the ratings for a specific criterion do not lead to a significant change in the overall relative rankings of the companies. Frost & Sullivan We Accelerate Growth

13 The results of this analysis are shown below. To remain unbiased and to protect the interests of all organizations reviewed, we have chosen to refer to the other key participants as Competitor 2 and Competitor 3. Measurement of 1 10 (1 = poor; 10 = excellent) New Product Innovation New Product Attributes Customer Impact Average Rating Kahuna Competitor Competitor New Product Attributes Criterion 1: Match to Needs Requirement: Customer needs directly influence and inspire the product s design and positioning. Criterion 2: Reliability Requirement: The product consistently meets or exceeds customer expectations for consistent performance during its entire life cycle. Criterion 3: Quality Requirement: Product offers best-in-class quality, with a full complement of features and functionalities. Criterion 4: Positioning Requirement: The product serves a unique, unmet need that competitors cannot easily replicate. Criterion 5: Design Requirement: The product features an innovative design, enhancing both visual appeal and ease of use. Customer Impact Criterion 1: Price/Performance Value Requirement: Products or services offer the best value for the price, compared to similar offerings in the market. Criterion 2: Customer Purchase Experience Requirement: Customers feel they are buying the most optimal solution that addresses both their unique needs and their unique constraints. Criterion 3: Customer Ownership Experience Requirement: Customers are proud to own the company s product or service and have a positive experience throughout the life of the product or service. Frost & Sullivan We Accelerate Growth

14 Customer Impact Criterion 4: Customer Service Experience Requirement: Customer service is accessible, fast, stress-free, and of high quality. Criterion 5: Brand Equity Requirement: Customers have a positive view of the brand and exhibit high brand loyalty. Decision Support Matrix Once all companies have been evaluated according to the Decision Support Scorecard, analysts then position the candidates on the matrix shown below, enabling them to visualize which companies are truly breakthrough and which ones are not yet operating at best-in-class levels. High Kahuna Competitor 2 Competitor 3 Low Low New Product Attributes High Frost & Sullivan We Accelerate Growth

15 Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices Frost & Sullivan analysts follow a 10-step process to evaluate Award candidates and assess their fit with select best practice criteria. The reputation and integrity of the Awards are based on close adherence to this process. STEP OBJECTIVE KEY ACTIVITIES OUTPUT 1 Monitor, target, and screen Identify Award recipient candidates from around the globe Conduct in-depth industry research Identify emerging sectors Scan multiple geographies Pipeline of candidates who potentially meet all bestpractice criteria 2 Perform 360-degree research Perform comprehensive, 360-degree research on all candidates in the pipeline Interview thought leaders and industry practitioners Assess candidates fit with best-practice criteria Rank all candidates Matrix positioning of all candidates performance relative to one another 3 Invite thought leadership in best practices Perform in-depth examination of all candidates Confirm best-practice criteria Examine eligibility of all candidates Identify any information gaps Detailed profiles of all ranked candidates 4 Initiate research director review Conduct an unbiased evaluation of all candidate profiles Brainstorm ranking options Invite multiple perspectives on candidates performance Update candidate profiles Final prioritization of all eligible candidates and companion best-practice positioning paper 5 Assemble panel of industry experts Present findings to an expert panel of industry thought leaders Share findings Strengthen cases for candidate eligibility Prioritize candidates Refined list of prioritized Award candidates 6 Conduct global industry review Build consensus on Award candidates eligibility Hold global team meeting to review all candidates Pressure-test fit with criteria Confirm inclusion of all eligible candidates Final list of eligible Award candidates, representing success stories worldwide 7 Perform quality check Develop official Award consideration materials Perform final performance benchmarking activities Write nominations Perform quality review High-quality, accurate, and creative presentation of nominees successes 8 Reconnect with panel of industry experts Finalize the selection of the best-practice Award recipient Review analysis with panel Build consensus Select recipient Decision on which company performs best against all best-practice criteria 9 Communicate recognition Inform Award recipient of Award recognition Present Award to the CEO Inspire the organization for continued success Celebrate the recipient s performance Announcement of Award and plan for how recipient can use the Award to enhance the brand 10 Take strategic action Upon licensing, company is able to share Award news with stakeholders and customers Coordinate media outreach Design a marketing plan Assess Award s role in future strategic planning Widespread awareness of recipient s Award status among investors, media personnel, and employees Frost & Sullivan We Accelerate Growth

16 The Intersection between 360-Degree Research and Best Practices Awards Research Methodology Frost & Sullivan s 360-degree research methodology represents the analytical rigor of our research process. It offers a 360-degree-view of industry challenges, trends, and issues by integrating all 7 of Frost & Sullivan's research methodologies. Too often companies make important growth decisions based on a narrow understanding of their environment, leading to errors of both omission and commission. Successful growth strategies are founded on a thorough understanding of market, technical, economic, financial, customer, best practices, and demographic analyses. The integration of these research disciplines into the 360-degree research methodology provides an evaluation platform for benchmarking industry 360-DEGREE RESEARCH: SEEING ORDER IN THE CHAOS participants and for identifying those performing at best-in-class levels. About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best practice models to drive the generation, evaluation, and implementation of powerful growth strategies. Frost & Sullivan leverages more than 50 years of experience in partnering with Global 1000 companies, emerging businesses, and the investment community from 45 offices on six continents. To join our Growth Partnership, please visit Frost & Sullivan We Accelerate Growth