tei of clear sale ing

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A Forrester Total Economic Impact™ Study Prepared For ClearSaleing

The Total Economic ImpactTM Of ClearSaleing

Project director: Michelle S. Bishop

Contributor: Jonathan Lipsitz

August 2010



Forrester Consulting


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TABLE OF CONTENTS

Executive Summary.....................................................................................................................................................................................................2 ClearSaleing Increased Return On Investment Of Online Ad Spend............................................................................................2 Factors Affecting Benefits And Costs ................................ ........................................... ....................................... ....................................... ..3 Disclosures.................................................................................................................................................................................................................3

TEI Framework And Methodology......................................................................................................................................................................4 Analysis..............................................................................................................................................................................................................................5

Interview Highlights .................................... ...................................... ....................................... ........................................... .................................5 Costs..............................................................................................................................................................................................................................8 Benefits.....................................................................................................................................................................................................................10 Flexibility.................................................................................................................................................................................................................18 Risk ...................................... ..................................... ........................................... ...................................... ....................................... ..........................19

Financial Summary...................................................................................................................................................................................................21 Appendix A: Composite Organization Description ............................... .......................................... ....................................... ..................24 Appendix B: Total Economic Impact™ Overview......................................................................................................................................25 Appendix C: Glossary...............................................................................................................................................................................................26 Appendix D: Supplemental Material................................................................................................................................................................26 © 2010, Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available

resources. Opinions reflect judgment at the time and are subject to change. Forrester ®, Technographics®, Forrester Wave, RoleView,

TechRadar, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective

companies. For additional information, go to www.forrester.com.

About Forrester Consulting

Forrester Consulting provides independent and objective research-based consulting to help leaders succeed in their organizations. Ranging in scope from a short strategy session to custom

projects, Forrester’s Consulting services connect you directly with research analysts who apply expert insight to your specific business challenges. For more information, visit

www.forrester.com/consulting.





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Executive Summary

As interactive marketing takes up more of a marketer’s budget, accurate measurement within and across

channels becomes paramount. Increasingly, interactive marketers are looking for attribution technology

partners to tell them not only whether a campaign was successful but also how various campaigns — and ad

channels — interact with and support or duplicate each other. Interactive marketing attribution is a complex

process of data storage and cleaning, as well as rich analytics and reporting. Vendors, from large site analytics

companies to small, focused start‐ups, have started to rise to the challenge of providing relevant products and

services.

According to ClearSaleing, the company was founded with the goal of developing an advanced advertising

analytics and attribution management platform that provides online marketers the ability to measure the true

effect of each digital advertising interaction and optimize their online spend accordingly, in real‐time. The

ClearSaleing platform helps marketers to optimize the effectiveness and profitability of their online advertising

channels, campaigns and individual ads.

In June 2010, ClearSaleing CS commissioned Forrester Consulting to examine the total economic impact and

potential return on investment ROI that enterprises may realize by deploying ClearSaleing’s Advertising

Analytics and Attribution Management Platform. The purpose of this study is to provide readers with a

framework to evaluate the potential financial impact of ClearSaleing on their organizations.

ClearSaleing Increased Return On Investment Of Online Ad SpendOur interviews with four existing customers and subsequent financial analysis found that a composite

organization based on these companies experienced the risk‐adjusted ROI, costs, and benefits shown in Table 1.

See Appendix A for a description of the composite organization.

Table 1

Composite Organization Two-Year Risk-Adjusted ROI

ROI Payback period Total benefits (PV) Total costs (PV) Net present value(NPV)

605% 6 months $2,735,499 ($387,803) $2,347,696

Source: Forrester Research, Inc.

• Benefits. The composite organization realized benefits of approximately $2.7 million over a two‐year

analysis. The following quantified benefits represent those experienced by the interviewed companies:

o Improved efficiency in decision‐making and media buying. With the insights on accurate attribution

management from ClearSaleing, organizations were able to improve their decision‐making and

translate these insights into channel savings. These savings were achieved through various means,





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including more efficient bidding on keywords, savings from formerly multiple‐attributed orders,

renegotiation of existing partner contracts, and the launch of new initiatives to increase conversion

rates.

o Labor savings and improved productivity savings from automation and reporting. Due to the improved

reporting capability and increased automation, organizations achieved time savings for their

marketing personnel.

The interviewed organizations also experienced qualitative benefits such as:

o Accurate attribution management and improved visibility.

o Improved flexibility and faster market response.

o Transparency and consistency of metrics.

o Improved integration with other internal information systems.

o Market differentiation.

o Increase in online advertising budget.

• Costs. The composite organization incurred costs of $387,803. Costs included the ClearSaleing license and

hosting fees, ClearSaleing initial setup fees, and internal labor for implementation, as well as

administrative costs.

Factors Affecting Benefits And Costs

Table 1 illustrates the risk‐adjusted financial results that were achieved by the composite organization. The risk‐adjusted values take into account any potential uncertainty or variance that exists in estimating the costs and

benefits, which produces more conservative estimates. The following factors may affect the financial results that

an organization may experience:

• Organizations with a larger budget for online ad spend can potentially see higher return on investment

when implementing ClearSaleing, as pricing is structured to allow organizations to scale their marketing

efforts over time without adding excessive additional costs.

• The benefits associated with end user productivity are dependent on how successful each company is at

leveraging the reporting capabilities available through ClearSaleing and on the company’s previous

processes for producing these reports.

DisclosuresThe reader should be aware of the following:

• The study is commissioned by ClearSaleing and delivered by the Forrester Consulting group.





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• Forrester makes no assumptions as to the potential return on investment that other organizations will

receive. Forrester strongly advises that readers should use their own estimates within the framework

provided in the report to determine the appropriateness of an investment in ClearSaleing.

• ClearSaleing reviewed and provided feedback to Forrester, but Forrester maintains editorial control over

the study and its findings and does not accept changes to the study that contradict Forrester’s findings or

obscure the meaning of the study.

• The customer names for the interviews were provided by ClearSaleing.

TEI Framework And Methodology

Introduction

From the information provided in the interviews, Forrester has constructed a Total Economic Impact™framework for those organizations considering implementing CS’s Attribution Management Platform. The

objective of the framework is to identify the cost, benefit, flexibility, and risk factors that affect the investment

decision.

Approach And Methodology

Forrester took a multistep approach to evaluate the impact that ClearSaleing can have on an organization see

Figure 2. Specifically, we:

• Interviewed ClearSaleing marketing, sales, and operations personnel and Forrester analysts to gather data

relative to ClearSaleing and the marketplace for ClearSaleing.

• Interviewed four organizations currently using ClearSaleing to obtain data with respect to costs, benefits,

and risks.

• Designed a composite organization based on characteristics of the interviewed organizations see

Appendix A.

• Constructed a financial model representative of the interviews using the TEI methodology. The financial

model is populated with the cost and benefit data obtained from the interviews as applied to the

composite organization.





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Figure 1

TEI Approach

Design compositeorganization

Construct financialmodel using TEI

framework

Write casestudy

Perform duediligence

Conductcustomerinterviews


Forrester employed four fundamental elements of TEI in modeling ClearSaleing’s service:

1. Costs.

2. Benefits to the entire organization.

3. Flexibility.

4. Risk.

Given the increasing sophistication that enterprises have regarding ROI analyses related to IT investments,

Forrester’s TEI methodology serves the purpose of providing a complete picture of the total economic impact of

purchase decisions. Please see Appendix B for additional information on the TEI methodology.

Analysis

Interview HighlightsA total of four interviews were conducted for this study, involving representatives from the following companies

ClearSaleing customers based in the United States:

1. A national financial services organization focused on insurance and investment services.

2. An online retail organization that provides social expression products such as greeting cards and

stationery services.

3. The online retail arm of a multinational company specializing in automotive products and services,

with an extensive network of brick‐and‐mortar stores.

4. A full‐service digital ad agency with more than 60 clients and more than 300 employees.

The interviews with these four customers uncovered a number of salient insights:

• The organizations went through an extensive evaluation process of different advertising analytics firms

before choosing ClearSaleing Attribution Management technology. These organizations were scaling





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their online marketing efforts and needed to find a tool that would provide more detailed and accurate

measurement around profitability of their marketing campaigns, as well as to find an advertising

analytics partner with a charging structure that would scale cost‐efficiently with their growth. As one

online retail organization noted of its former agreement with another partner, “Our environment is very

volatile; we have to do new things all the time, and pay‐per‐click was killing us.”

• The digital ad agency needed a single source of marketing activity for all its clients, as it was previously

relying on individual vendor data by channel with different metrics. The agency wanted to apply a

standard reporting tool across the board to give it the ability to provide portfolio management for its

many clients.

• Focus on ROI and profitability was one of the key reasons the interviewed organizations chose

ClearSaleing. One online retail organization noted, “It was a better way to see ROI and profit so we could

leverage budget outside of paid search for overall growth.” Another noted that, at the time of evaluation,

few companies were analyzing data with a view toward ROI and attribution. The director for interactive

marketing noted, “The real savvy marketers get it, but it was a very dramatic shift for other agencies.More bottom‐line‐oriented companies recognize the need quite easily.”

• In observing the challenge of measuring marketing effectiveness prior to using ClearSaleing, one senior

marketing manager for another interviewed company said, “We need exact measurement of effort, based

on profitability. Other tools are focused on last‐click or number of visits, when our primary goal is

subscriptions, not traffic. We needed to know what the value of that traffic is through conversions.”

• Coupled with this focus on ROI, the interviewed companies also noted the ease with which they could

integrate external data from their existing systems with ClearSaleing to get to the detailed analytics they

needed to evaluate campaigns across different channels. One director of analytics noted, “They had the

ability to work within our existing links in our current programs and read inbound activity — that’s

incredible flexibility.” Some organizations had investigated whether other advertising analytics vendors

had this flexibility on data integration from other sources but found these vendors to be lacking this

capability or without as extensive a functionality.

• Transparency and visibility through ClearSaleing’s attribution model were also consistently mentioned by

the interviewed organizations as major factors in their purchase decisions. The organizations could now

get insight into how sales were closed through reviewing the Purchase Path. This data was also tied back

to general revenue metrics that were relevant to the organization. “With ClearSaleing, everything was

100% visible to us,” the senior marketing manager for acquisitions noted.

• Attribution management also helped the interviewed organizations address the credit duplication issue

they were currently seeing in the data from their vendors and internal systems.

• The automation of this visibility through reports was also a selling point to the organizations interviewed.

Many of them did not have these reporting capabilities in their current environment and were looking

for a tool that could alleviate the reporting burden of their marketing teams.

• The interviewed companies all had different levels of interaction with ClearSaleing. Most were interacting

with ClearSaleing for advertising analytics. However, there were instances where a company had a





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deeper partnership with ClearSaleing for analytics as well as agency services. Benefits from using

ClearSaleing as an agency, such as cost avoidance of previous agency and technology fees, were not

included in this case study analysis.

• One organization had also evaluated the alternative of building its own attribution model tool internally,

as it had the technical resources to do so. The company estimated that this would have cost three times

as much as using ClearSaleing for one year. In the end, the company decided not to build a solution

internally, noting that “ClearSaleing had everything and was a turnkey solution to get what we needed

from a measurement perspective.” This cost‐avoidance benefit is also not included in the case study

analysis, as most prospects would not consider internal development of an attribution tool as a viable

alternative.

Composite Organization

Based on the interviews with the four existing customers provided by ClearSaleing, Forrester constructed a TEI

framework, a composite company, and an associated ROI analysis that illustrates the areas financially affected.

The composite organization that Forrester synthesized from these results represents a multichannel retailer

with an online presence, as well as more than 600 brick‐and‐mortar stores.

Framework Assumptions

Table 2 provides the model assumptions that Forrester used in this analysis.

Table 2

Model Assumptions

Ref. Metric Calculation Value

A1 Hours per week 40

A2 Weeks per year 52

A3 Hours per year (M-F, 9-5) 2,080

A4 Web developer $80,000

A5 Hourly (A4/A3) $38.46

A6 Marketing analyst $60,000

A7 Hourly (A6/A3) $28.84


The discount rate used in the PV and NPV calculations is 10%, and the time horizon used for the financial

modeling is three years. Organizations typically use discount rates between 8% and 16% based on their current





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environment. Readers are urged to consult with their respective company’s finance department to determine

the most appropriate discount rate to use within their own organizations.

CostsThe main costs associated with implementing ClearSaleing are: 1 ClearSaleing licensing and hosting fees; 2

ClearSaleing setup fees; 3 Cost of internal labor for implementation; and 4 administrative costs.

ClearSaleing Licensing And Hosting Fees

The annual costs of implementing ClearSaleing include licensing and hosting fees for ClearSaleing’s advertising

analytics software services. Licensing fees are charged to organizations as a percentage of total digital

advertising spend under a tiered pricing model. Hosting fees are also on a tiered pricing model, and fees are

dependent on the number and size of the brands/products tracked by ClearSaleing. Pricing for licensing and

hosting fees may also vary, depending on whether the organization is an enterprise or an agency.

The fees that the composite organization, a multichannel retailer with an average $5 million in online ad spend

per year, pays for ClearSaleing licensing and hosting services come to $153,600 annually.

ClearSaleing Setup Fees

For each ClearSaleing implementation, setup fees are charged for the task of onboarding customer products on

the ClearSaleing platform. These fees include engineering setup for the ClearSaleing tool, implementing client‐

side tracking codes, and integration with back‐office elements, such as product feeds and ROI‐calculation setup.

The interviewed organizations had a wide range of setup fees. Agencies with multiple clients could spend

around $100,000 in onboarding fees, while e‐tailers with only two brands on ClearSaleing could initially spend

as little as $5,000 in onboarding fees.

The composite organization paid setup fees of $18,000 to ClearSaleing in Year 1 to set up the services for its

various products and an additional $5,000 in setup fees as it expanded tracking to other products in its portfolio

in Year 2.

ClearSaleing Additional Fees

Organizations may also incur additional fees from ClearSaleing, depending on the custom services negotiated

with ClearSaleing. These may include client‐dependent customization such as dashboards, complex integrations

with different customer Web sites, and in some cases, management fees for campaigns and search engine

optimization services.

There were no additional fees for the composite organization, as the company used ClearSaleing for advertising

analytics and did not require custom services.

Implementation Costs — Internal Labor

According to the customer interviews, the time required to implement ClearSaleing was dependent on a

customer’s previous environment and its level of complexity. Some customers required three months of

discovery and coding for more than 60 different clients with custom sites, as well as time to integrate





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ClearSaleing with other vendors, such as email service providers. Other customers required at least two months

to clean up their data and work with their internal processes to roll out ClearSaleing to all the necessary systems

and multiple product areas. Customers that came from a greenfield environment needed only four weeks to

define business requirements and three weeks to create the design document and implement ClearSaleing. After

this implementation period, the interviewed companies also spent some months on data analysis and validation,

as well as on establishing baselines and refining metrics.

The composite organization spent three months, or 520 hours, implementing ClearSaleing. The first two‐and‐a‐

half months were spent on planning, discovery, data clean‐up and coding. The next half month was spent on the

actual rollout of ClearSaleing. After this period, an additional two months, or 347 hours, was spent on data

analysis and establishing baselines for metrics. This implementation took 25% of the time of two full‐time

equivalents FTEs. At a fully loaded annual compensation of $80,000, or $38.46 per hour, implementation costs

for the organization were $16,667.

Table 3Implementation Costs — Internal Labor

Ref. Metric Calculation Per period Year 1 Year 2 Total

B1 Number of people 2

B2 Hourly rate per person $38.46

B3 Hours [Rounded] 867

B4Percentage of time

allocated25%

Bt Implementation costs B1*B2*B3*B4 $16,667

Bto Total (original) ($16,667) $0 $0 ($16,667)


Administrative Costs

The composite organization allocates 20% of one Web analyst’s time to the administration of the ClearSaleing

relationship and tool. At a fully loaded compensation of $60,000, administrative costs for ClearSaleing came to$12,000 per year.





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Table 4

Administrative Costs


Total Costs

The total incremental costs to the composite organization of implementing ClearSaleing are $425,667 see Table

5.

Table 5

Total Costs

Costs Initial Year 1 Year 2 Total

ClearSaleing license and hosting fees ($180,000) ($180,000) ($360,000)

Initial setup fees ($25,000) ($25,000)

Implementation costs ($16,667) ($16,667)

Administrative costs ($12,000) ($12,000) ($24,000)

Total ($41,667) ($192,000) ($192,000) ($425,667)


Benefits

“ClearSaleing gives us visibility — it enables us to see things we wouldn’t otherwise have seen. It shines

a light into the dark corners of consumer behavior across multiple channels.” Director of interactive

marketing, financial services company

Ref. Metric Calculation Per period Year 1 Year 2 Total

C1 Number of people 1

C2 Hourly rate per Person $28.85

C3 Hours 416

Ct Administrative costs C1*C2*C3 $12,000

Cto Total (original) $0 ($12,000) ($12,000) ($24,000)





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The companies interviewed for this study all noted the importance of accurate attribution management as a

benefit of using CS’s Advertising Analytics platform. Accurate attribution management changes the way an

organization approaches media buying and online advertising.

With the insight provided by ClearSaleing, these companies were able to improve their efficiency in online ad

spend. This efficiency came from various sources — savings from former multiple‐attributed orders, more

effective media buying for keywords, geographic targeting, and reallocation of ad spend to channels with higher

return on investments, among others. Some organizations were also able to renegotiate partner contracts for

display advertising and launch new marketing initiatives that resulted in increased conversion rates.

Other quantified benefits came in the form of labor savings and improved productivity for the digital marketing

staff, as companies were able to take advantage of the automation and reporting capabilities of ClearSaleing.

Benefits of ClearSaleing that were not quantified but were cited by the interviewed companies include: accurate

attribution management, improved visibility and faster market response, consistency of metrics, improved

integration with internal information systems, market differentiation, and increase in online advertising spend.

Channel Savings Due To Improved Efficiency

“We are now buying terms that people are actually searching on. Through ClearSaleing, we’re more

efficient with our bids and where we invest. That has generated a very positive return for us. They are

helping us spend our money wisely and helping us make money.” eCommerce manager, automotive

products and services company

Across the board, all interviewed companies noted that ClearSaleing has generated a positive return on their

investments by enabling their organizations to be more effective and efficient with their media buying. These

efficiencies came from many areas. Organizations noted that they could now more accurately measure the

impact of their search bidding position by keyword. “We knew that not all keywords were created equal, but it

was hard to see the difference. Now we can see which words have higher conversions and which need more

testing at different price points,” one senior marketing manager noted, giving an example of how ClearSaleing

helped the organization early on in reinvesting in more profitable keywords. In addition, customers with

regional marketing needs could now get highly segmented data on paid search through ClearSaleing and

respond accordingly per geography for “constant optimization.” As one director for interactive marketing said,

“We could never have done that with our site analytics tool or traditional analytics.”

As organizations progressed in their use of ClearSaleing, they tracked “from the top of the funnel” and increased

ad spend there to improve conversion rates. They also expanded tracking to other channels such as affiliate,

display, social media, video, and email.

Improved duplication insight was another area that yielded increased efficiency and channel savings for the

interviewed organizations. These companies were able to take savings from orders that were formerly

attributed to multiple sources, streamline their media buys, and reinvest the resulting savings to target

“influencers and introducers” to drive their marketing programs to their desired returns.

By reallocating spending into more efficient ad channels, the interviewed companies reported savings in

different ways. One organization’s cost per action was reduced by an average of 43%. Another increased its





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conversion rate by 50%, despite reducing ad spend by about $100,000 a year. One customer that was six

months into its ClearSaleing implementation had already realized savings from the low teens up to as high as

20% for different channels and noted that it was “moving in the right direction” toward its projected return of

10x on its investment in the ClearSaleing program. Another customer reported 283% year‐over‐year

improvement in efficiency in regard to cost per acquisition. One interviewed customer reported 150% ROI on its

search engine marketing program, of which ClearSaleing was a major component.

For a conservative approach, Forrester estimates channel savings for the composite organization to be 25% of

online ad spend in Year 1 and 35% in Year 2. At $5 million in total online ad spend, this translates to channel

savings of $3 million over two years for the composite organization, due to improved efficiency in media buying

through its ClearSaleing implementation.

Table 6

Improved Efficiency — Channel Savings

Ref. Metric Calculation Per period Year 1 Year 2

D1 Online ad spend $5,000,000

D2 Channel savings 25% 35%

Dt Improved efficiency — channelsavings

D1*D2 $1,250,000 $1,750,000

Dto Total (original) $1,250,000 $1,750,000 $3,000,000


Some of the interviewed customers also cited specific, quantified examples of ClearSaleing’s benefits that

contributed to improved efficiency in their online ad spend. The quantified benefits from these examples are

included in the overall improved efficiency benefit described above. However, for the purposes of this study,

these examples will also be discussed in detail in the sections below.

Savings From Renegotiating Performance Display Contract Terms

One interviewed organization noted that, by using more accurate attribution metrics with CS’s Attribution

Management platform, it was able to renegotiate its contracts with its performance display vendors. Under

these new contract terms for buying display advertising based on cost per action CPA, the display ad networks

are fully compensated on actions directly attributed to their performance media through Purchase Path.

Otherwise, partial credit is given.

By applying attribution, display vendors that work on a CPA model can adjust their campaigns to serve media

where the display vendors make the most money in other words, where there is less Purchase Path overlap





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with other CPA display vendors and the organization benefits by reaching new and effective audiences instead

of targeting the same people that other channels do. “We are also limiting spend waste on customers we would

have received anyway,” the organization’s senior marketing manager for acquisitions noted. The organization

estimated that, by applying attribution to its marketing spend, it saves about 20% per campaign, which may

then be used to invest in other media that earns a greater ROI.

The composite organization has an annual average ad spend of $315,000 annual performance display budget

with each vendor. Working with two display‐specific performance vendors throughout the year, the composite

organization saves $252,000 over two years.

Table 7

Vendor Savings — Display Advertising

Ref. Metric Calculation Per period Year 2 Total

E1 Average annual spend oncampaign with performancedisplay partners

$315,000

E2 Average number of partners 2

E3 Savings per campaign 20%

Et Vendor savings — displayadvertising

E1*E2*E3$126,000

Eto Total (original) $126,000 $126,000 $252,000


Increased Conversion Rates Due To New Marketing Initiatives

Another interviewed organization stated that one of the larger quantified benefits of implementing ClearSaleing

was increased conversions from new campaigns and initiatives due to the ability to shift resources internally to

more strategic projects. Prior to ClearSaleing, the online marketing team was spending most of its efforts on

forecasting current campaigns and extracting reporting metrics from data that contained double counting and

other anomalies. With more accurate reporting, the organization could now focus on new marketing campaigns,

new landing pages, and other strategic projects that resulted in conversion rates increasing from 20% for one

initiative to 50% for another.

One interviewed financial services organization also noted that, with its success in using ClearSaleing, the

company is now looking at expanding usage and developing online marketing campaigns to other financial

products that are “not traditionally oriented to online.” The main driver behind launching these new products is





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the ability to promote these products effectively and measure the effects of the promotions through

ClearSaleing.

As ClearSaleing allowed the composite organization to shift resources to more strategic initiatives, the

composite organization saw conversion rates increase to 20% as a result of these strategic projects, which

represent 30% of its online ad spend. At an average return on investment on search engine marketing of 150%,

which includes the ClearSaleing program, the benefit to the composite organization of these new initiatives is

valued at $900,000 over a two‐year period.

Table 8

Increased Conversions From Launching New Marketing Initiatives


F1 Online ad spend $5,000,000

F2Percentage of online ad spendaffected

30%

F3 Increase in conversion rate 20%

F4Average ROI on search enginemarketing

150%

FtIncrease Conversions From NewInitiatives

F1*F2*F3*F4 $450,000

Fto Total (original) $450,000 $450,000 $900,000


Labor Savings From Improved Reporting

“We wanted to have a single source for reporting all our marketing activity for our clients. As a vendor,

they ClearSaleing are extremely flexible and easy to work with. With the quantity of reports, the

slicing and dicing of data — it has improved measurement at the granular level.” Head of marketing

strategy and analytics, digital ad agency

“The information and data we were getting from our previous search engine market vendor was not

robust. We needed something more detailed. Every investment we made, we wanted to make sure we

were getting a return on it. ClearSaleing has customized reporting for us, I get a dashboard on a weekly

basis, and we couldn’t be happier with the quality of the work.” eCommerce manager, automotive

products and services company





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Organizations interviewed for the study noted that the improved reporting and automation available through

ClearSaleing resulted in labor savings for their companies. Teams no longer needed the resources to cull

through data, clean up duplications, and prepare reports. One organization noted that, by having its data

warehouse records go to ClearSaleing, ClearSaleing is able to map all the interactions and avoid the double

counting between paid search and email that was going on before. Another online retail company noted that

ClearSaleing had “shortened our path to performance data” and allowed its eCommerce team to iterate and

optimize on a smaller cycle. While this company might have had some of this data available to it in its previous

environment, ClearSaleing enabled it to operationalize and standardize reporting. “We’ve got it set up in a way

that it’s going into the right buckets via different tools,” the director for interactive marketing said. With

ClearSaleing, the organization went from a monthly reporting cycle with a four‐week lag to a weekly reporting

cycle with a one‐day lag.

One online retail organization estimated that it had saved 75% of one FTE and would have had to hire three

more FTEs without ClearSaleing. Another retail organization estimated that it had saved three FTEs with its

ClearSaleing implementation.

Labor savings for the composite organization due to ClearSaleing are estimated at three FTEs. At a fully loaded

annual compensation of $60,000 for a marketing analyst, this translates to $360,000 in savings over two years.

Table 9

Labor Savings


G1 Number of FTEs (saved) 3

G2 Yearly rate per FTE $60,000

Gt Labor savings G1*G2 $180,000

Gto Total (original) $180,000 $180,000 $360,000


Improved Productivity

In addition to labor savings, interviewed organizations also reported that reporting and automation benefits of

ClearSaleing enabled their current staff to do more work. These organizations estimated productivity savings for

their current teams in a range of 30% to 40%.

For the composite organization, productivity savings for the current online marketing staff of two are estimated

at 30%. This translates to 624 hours per worker per year. For a conservative approach, Forrester estimates that

only 50% of that time is used for productive work. At a fully loaded annual compensation of $60,000 for a





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marketing analyst, or $28.85 per hour, the composite organization realizes productivity savings of $36,000 over

two years.

Table 10

Improved Worker Productivity


H1 Number of workers 2

H2 Hourly rate per worker $28.85

H3 Number of hours (saved) 624

H4 Percent captured 50%

Ht Improved worker productivity H1*H2*H3*H4 $18,000

Hto Total (original) $18,000 $18,000 $36,000


Additional Benefits Of ClearSaleing

Companies interviewed for this study described numerous categories of benefits either accrued or expected

from their ClearSaleing implementation. To ascribe financial benefit for the composite company, Forrester

included only the categories of benefit that were most compellingly articulated and estimated. Yet the

interviews also pointed to improved visibility into consumer behavior, faster market response, and consistency

of metrics, which should produce additional benefits for some organizations. Forrester has identified additional

benefit areas that ClearSaleing customers may realize. The following categories of benefit were articulated by

the companies interviewed for this study, albeit without an amount of data to support quantification.

Accurate Attribution Management And Improved Visibility

When asked about the feature that was most valuable around their use of ClearSaleing, most interviewed

organizations cited attribution management and Purchase Path behavior. With ClearSaleing, these organizations

could now identify attribution of activity without duplication within their marketing channels. “We now have a

clearer understanding of where traffic is coming from,” one organization noted. This same organization used tospend a lot of time and effort analyzing direct URL and SEO traffic and mining this data with another reporting

tool. Another organization noted that, using its previous tool, “there were just analytics that we weren’t seeing.”

Accurate attribution management and reporting through ClearSaleing improved visibility and gave these

organizations the data they needed to make better decisions on online spend, identify new opportunities, and

improve the efficiency of their marketing programs.





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Improved Flexibility And Faster Market Response

“If we wanted to analyze a new channel, it’s a ticket, not a project.” Senior manager of analytics, digital

ad agency

The flexibility of the tool was another benefit that the interviewed organizations brought up when discussing

ClearSaleing. This was especially valuable to organizations dealing with a width and depth of products, such as

financial services, where the sales cycle for a money market account is different from that of auto insurance.

This flexibility was also important for organizations with geographically segmented products as well as for ad

agencies managing multiple unique clients. These companies were able to easily change parameters through the

settings in the ClearSaleing tool to customize the data that they needed for each particular product, product

segment, geographic area, or client. This improved flexibility and ease of reporting also enabled the interviewed

organizations to respond faster to any market changes, such as volatile consumer behavior and increases in a

competitor’s marketing programs for certain regions.

Transparency And Consistency Of Metrics Consistency of process and metrics was another benefit experienced by the interviewed organizations. Prior to

implementing ClearSaleing, some of the organizations had to rely on data reported by their vendors, which was,

as one marketing manager noted, akin to “letting the fox out in the henhouse.” These organizations were relying

on disparate sources for their data, with disjointed digital promotions measured independently. “We were doing

last‐click and other ways to measure, such as through self‐reporting, offer codes and the like, and attribution

became very difficult. So every option looked like a great option, but really, some are better than others.”

ClearSaleing’s transparency and consistency of metrics were a benefit to these organizations in providing a

clearer, standardized view for managing their digital campaigns effectively.

Improved Integration With Internal Information Systems

ClearSaleing enables organizations to integrate data from back‐end systems, such as customer relationship

management CRM, and other reporting sources, such as an existing email data warehouse, to map out the

Purchase Path and provide a richer context for attribution and computing ROI online ad spend. Interviewed

organizations were benefiting from this improved integration with their internal information systems, as they

could now clearly see the interaction among different marketing channels and could define customized models

for ROI, functionality not available in their previous environments. One organization noted that, with

ClearSaleing, it could now bring external data such as win rates, price competiveness, other media spend, and

regional agent numbers into its analysis. With its distributed model, this detailed analysis was important to the

company, not just in attribution but in understanding how saturation could affect efficiency in its marketing

campaigns.

Market Differentiation

The ad agency that implemented ClearSaleing noted that it was a market differentiator for its organization to

have an attribution tool. Being able to provide a level of analysis and guidance on attribution management set it

apart from its competition and provided additional business development opportunities for the company. “It’s

definitely a topic that keeps us longer in the running and helps us acquire new business,” the agency said.





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For one online retail organization that sold directly to the consumer, data from ClearSaleing allowed it to

differentiate itself in the market, as it used this data to classify different purchase paths and segment its

customers. With these insights from ClearSaleing, the organization was able to customize the creative

experience for these different market segments, enabling it to strategically anticipate customer needs.

Increase In Online Advertising Budget

Coupled with the improved marketing efficiency and reduction of cost to buy advertising, organizations that

implemented ClearSaleing also saw an increase in online advertising spend, as they were able to demonstrably

prove to their executive teams the effectiveness of their programs. One online retail organization’s marketing

budget for search grew 23.8x over four years. Another online retail organization doubled its budget over three

years. Yet another organization noted that, with the success of ClearSaleing, it was expanding its programs to its

dealer network and was planning on spending more on online advertising in the next year.

Total Benefits

The composite organization achieved total benefits of $3,396,000 over a two‐year analysis.

Table 11

Total Benefits

Benefits Year 1 Year 2 Total

Improved Efficiency — channel savings $1,250,000 $1,750,000 $3,000,000

Labor savings $180,000 $180,000 $360,000

Improved worker productivity $18,000 $18,000 $36,000

Total $1,448,000 $1,948,000 $3,396,000


FlexibilityFlexibility, as defined by TEI, represents an investment in additional capacity or capability that could be turned

into business benefit for some future additional investment. This provides an organization with the “right” or

the ability to engage in future initiatives but not the obligation to do so. There are multiple scenarios in which a

customer might choose to implement ClearSaleing and later realize additional uses and business opportunities.Flexibility is described in more detail in Appendix B.

Although data for calculating the value of several flexibility options was insufficient when this study was

conducted, our interviews identified several areas that could produce flexibility options, based on next‐stage

real options that were described by study participants:





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• Data mining. Organizations in the early stages of ClearSaleing implementation anticipate seeing more

benefits in channel savings and other efficiencies as they become more dependent on data from

ClearSaleing. They anticipate developing a more solid practice of data mining around ClearSaleing,

relying on deeper granular data for their decision‐making with their account teams.

• Tracking. Adding tracking for additional channels such as offline, in‐store orders, and agent call orders

was another area that the interviewed organizations identified as a source of benefit. “We know we are

driving more traffic than we are getting credit for,” one eCommerce manager said, hoping that the rollout

of this new initiative in the next month would enable the company to measure and prove additional

benefit of its search engine marketing efforts.

• Reporting. Another organization was heavily involved in a ClearSaleing user group to explore future

improvements to the reporting, such as creating real‐time dashboards including some of the data from

ClearSaleing that is currently available, though not in a “digestible format.” Should this capability be

available in future versions, organizations characterized it as “optimal” and anticipated seeing additional

benefits.

The value of flexibility is unique to each organization, and the willingness to measure its value varies from

company to company.

RiskForrester defines two types of risk associated with this analysis: implementation risk and impact risk.

“Implementation risk” is the risk that a proposed investment in ClearSaleing may deviate from the original or

expected requirements, resulting in higher costs than anticipated. “Impact risk” refers to the risk that the

business or technology needs of the organization may not be met by the investment in ClearSaleing, resulting in

lower overall total benefits. The greater the uncertainty, the wider the potential range of outcomes for cost and

benefit estimates.

Quantitatively capturing investment and impact risk by directly adjusting the financial estimates results in more

meaningful and accurate estimates and a more accurate projection of the ROI. In general, risks affect costs by

raising the original estimates, and they affect benefits by reducing the original estimates. The risk‐adjusted

numbers should be taken as “realistic” expectations, as they represent the expected values considering risk.

The following risks that affect costs are identified as part of this analysis:

• Licensing, hosting, and setup fees are variable and dependent on an organization’s overall digital ad spend.

• Implementation and administration costs may be higher, as data integration and rollout to an

organization’s internal processes and systems may take longer than expected.

The following impact risks that affect benefits are identified as part of the analysis:

• Improved efficiency and channel savings for each organization may vary with the pace of ClearSaleing

adoption and an organization’s previous environment.





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Financial Summary

The financial results calculated in the Costs and Benefits sections can be used to determine the return on

investment, net present value, and payback period for an organization’s investment in ClearSaleing. These are

shown in Table 13 below.

Table 13

Cash Flow — Non-Risk-Adjusted

Cash flow — original estimates

Initial Year 1 Year 2 Total Present value

Costs ($41,667) ($192,000) ($192,000) ($425,667) ($474,890)

Benefits $0 $1,448,000 $1,948,000 $3,396,000 $2,926,281

Net benefits $1,256,000 $1,756,000 $2,970,333 $2,551,391

ROI 681%

Payback period 5 months


Table 14 below shows the risk‐adjusted ROI, NPV, and payback period values. These values are determined by

applying the risk‐adjustment values from Table 12 in the Risk section to the cost and benefits numbers in Tables

5 and 11.

Table 14

Cash Flow — Risk-Adjusted

Cash flow — Risk-adjusted estimates

Initial Year 1 Year 2 Total Present value

Costs ($44,583) ($197,760) ($197,760) ($440,10303) ($387,803)

Benefits $0 $1,354,740 $1,819,740 $3,174,480 $2,735,499

Net benefits $1,156,980 $1,621,980 $2,734,377 $2,374,696

ROI 605%

Payback period 6 months






Page 22

ClearSaleing OverviewAccording to ClearSaleing, the company was founded in 2006 with the goal of developing an advanced

advertising analytics and attribution management platform providing online marketers the ability to measure

the true effect of each digital advertising interaction and optimize their online spend accordingly, in real‐time.The Company’s platform helps marketers to optimize the effectiveness and profitability of their online

advertising channels, campaigns and individual ads. ClearSaleing tracks the chronological sequence of the

customer’s online media interactions, which they call Purchase Path. The digital media touch points captured in

a given Purchase Path include both the “hard” actions taken by the consumer such as a click, search or direct

navigation, and the consumer’s passive interactions, such as being served display advertisements. ClearSaleing

delivers this in their SaaS based platform by providing dashboards, reports, alerts and optimization tools.

Specific capabilities delivered by ClearSaleing’s advertising analytics and attribution management platform

include:

• Cross‐media tracking spanning across a consumers’ online Purchase Path

• Complete interaction tracking ranging from 1 – infinite days per Purchase Path

• Capture an infinite number of advertising interactions per conversion

• Profit analytics can incorporate cost of goods sold data, margin data or a custom profit calculation, such as

lifetime value LTV and net present value NPV

• Ability to track offline conversions that occur over the phone and at brick and mortar stores via Point of

Sale systems

• Connection of disparate digital online interactions in one data warehouse

• Optimization tools, including bid management, keyword suggestion and creative management

The ClearSaleing advertising analytic solution is made up of several components:

• Application screens.

• Reports.

• Alerts.

• Efficiency tools.

Application Screens

In addition to the account settings screen, ClearSaleing has 60 application screens that provide users with

actionable data. The screens are broken into the following sections:





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• Performance. Performance screens all have the attribution calculations “baked right in.” Credit is allocated

to each source click and banner ad impressions based on the attribution model the user has chosen.

Almost every of the 32 screens can be exported to Excel.

• CRM. ClearSaleing’s CRM tab contains all of the data captured from every form tracked with ClearSaleing.

In addition to the demographic data, there is the Purchase Path detail of all clicks and impressions with

date and time and the products purchased. Users can search for specific data by selecting date range,

sales type, and sales stage criteria. Search results can be exported to Excel.

• Maximizer. The Maximizer section contains all of the efficiency tools bid management and creative

management.

• Operations. Operations screens have no attribution factored into the calculations. The data is in real time.

All credit is applied the day of the conversion and credited to the last click. Operations screens are

extremely useful for comparing data to all other systems as well as for seeing how campaigns are

performing the day they are launched in real time.

Reports

ClearSaleing offers almost 200 reports out of the box. Reports can be run using attributed data performance

reports or non‐attributed data operations reports. Reports can be run on demand or scheduled. Reports can

be delivered in different formats: HTML, PDF, Excel, CSV, XML, pipe delimited, and external data source. Larger

reports can be sent to an FTP location rather than received via email. Users can use the custom report module

report‐builder wizard teamed with the external data source option to customize their own dashboards.

Alerts

Users can create an unlimited number of reports to track the performance against a threshold e.g., fewer than

five orders per day or against a previous period of time e.g., compare yesterday to the previous day. Alertscan be configured from the highest‐level lead source e.g., Google AdWords to the most granular level e.g., a

specific keyword.

Efficiency Tools

ClearSaleing’s efficiency tools save users a great deal of time by facilitating making changes across the top five

search engines. Efficiency tools include a manual bid manager, an automated, rules‐based bid manager, and bulk

sheet creative ad text editor.





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Appendix A: Composite Organization Description

For this TEI study, Forrester has created a composite organization to illustrate the quantifiable costs and

benefits of implementing ClearSaleing’s Advertising and Analytics platform based on the characteristics of the

four interviewed customers provided by ClearSaleing. The composite company is intended to represent an

online retail division of a retail organization with a network of brick‐and‐mortar stores in North America.

The composite company is a retail organization with $1.5 billion in annual revenue and more than 7,000

employees. Its online retail division represents a $300 million contribution to this revenue, with $5 million in

overall digital ad spend and two online marketing staff.

Prior to its investment in ClearSaleing:

• The composite company was running a number of disparate online marketing campaigns, each being

measured independently. The composite organization also planned to scale its campaigns over the next

couple of years.

• The composite company was working with another search engine marketing vendor for some of its

campaigns but found that the data received was not as robust and detailed as the organization needed.

• The organization was also using other Web analytics tools that were not attribution‐based and planned to

continue using these tools in conjunction with ClearSaleing.

• The organization maintained a five‐person marketing analytics team.

In implementing ClearSaleing, the composite company had the following objectives:

• Establish a more bottom‐line‐oriented, ROI approach to measure the performance of marketing activity.

• Implement a standard reporting tool for all online marketing campaigns.

• Eliminate duplication within the online marketing channel by correct attribution of credit.

• Roll out a flexible solution that could work with the organization’s existing internal processes and systems

as well as the organization’s multiple product lines and product segments within these lines.

• Improve report production and, subsequently, the productivity of its marketing analytics team.





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Appendix B: Total Economic Impact™ Overview

Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s

technology decision‐making processes and assists vendors in communicating the value proposition of their

products and services to clients. The TEI methodology helps companies demonstrate, justify, and realize the

tangible value of IT initiatives to both senior management and other key business stakeholders.

The TEI methodology consists of four components to evaluate investment value: benefits, costs, risks, and

flexibility.

Benefits

Benefits represent the value delivered to the user organization — IT and/or business units — by the proposed

product or project. Often product or project justification exercises focus just on IT cost and cost reduction,

leaving little room to analyze the effect of the technology on the entire organization. The TEI methodology and

the resulting financial model place equal weight on the measure of benefits and the measure of costs, allowing

for a full examination of the effect of the technology on the entire organization. Calculation of benefit estimates

involves a clear dialogue with the user organization to understand the specific value that is created. In addition,

Forrester also requires that there be a clear line of accountability established between the measurement and

justification of benefit estimates after the project has been completed. This ensures that benefit estimates tie

back directly to the bottom line.

Costs

Costs represent the investment necessary to capture the value, or benefits, of the proposed project. IT or the

business units may incur costs in the forms of fully burdened labor, subcontractors, or materials. Costs consider

all the investments and expenses necessary to deliver the proposed value. In addition, the cost category within

TEI captures any incremental costs over the existing environment for ongoing costs associated with thesolution. All costs must be tied to the benefits that are created.

Risk

Risk measures the uncertainty of benefit and cost estimates contained within the investment. Uncertainty is

measured in two ways: 1 the likelihood that the cost and benefit estimates will meet the original projections,

and 2 the likelihood that the estimates will be measured and tracked over time. TEI applies a probability

density function known as “triangular distribution” to the values entered. At a minimum, three values are

calculated to estimate the underlying range around each cost and benefit.

Flexibility

Within the TEI methodology, direct benefits represent one part of the investment value. While direct benefits

can typically be the primary way to justify a project, Forrester believes that organizations should be able to

measure the strategic value of an investment. Flexibility represents the value that can be obtained for some

future additional investment building on top of the initial investment already made. For instance, an investment

in an enterprise‐wide upgrade of an office productivity suite can potentially increase standardization to

increase efficiency and reduce licensing costs. However, an embedded collaboration feature may translate to

greater worker productivity if activated. The collaboration can only be used with additional investment in





training at some future point in time. However, having the ability to capture that benefit has a present value that

can be estimated. The flexibility component of TEI captures that value.

Appendix C: Glossary

Discount rate: The interest rate used in cash flow analysis to take into account the time value of money. Although

the Federal Reserve Bank sets a discount rate, companies often set a discount rate based on their business and

investment environment. Forrester assumes a yearly discount rate of 10% for this analysis. Organizations

typically use discount rates between 8% and 16% based on their current environment. Readers are urged to

consult their respective organization to determine the most appropriate discount rate to use in their own

environment.

Net present value NPV: The present or current value of discounted future net cash flows given an interest

rate the discount rate. A positive project NPV normally indicates that the investment should be made, unless

other projects have higher NPVs.

Present value PV: The present or current value of discounted cost and benefit estimates given at an interest

rate the discount rate. The PV of costs and benefits feed into the total net present value of cash flows.

Payback period: The breakeven point for an investment. The point in time at which net benefits benefits minus

costs equal initial investment or cost.

Return on investment ROI: A measure of a project’s expected return in percentage terms. ROI is calculated by

dividing net benefits benefits minus costs by costs.

A Note On Cash Flow Tables The following is a note on the cash flow tables used in this study. The initial investment column contains costs

incurred at “time 0” or at the beginning of Year 1. Those costs are not discounted. All other cash flows in Years 1

through 3 are discounted using the discount rate shown in the Framework Assumptions section at the end of

the year. Present value PV calculations are calculated for each total cost and benefit estimate. Net present

value NPV calculations are not calculated until the summary tables and are the sum of the initial investment

and the discounted cash flows in each year.

Appendix D: Supplemental Material

Related Forrester Research

“Redefining Attribution In The Social Computing Era,” Forrester Research, Inc., March 3, 2009

“The Interactive Attribution Landscape,” Forrester Research, Inc., October 20, 2009

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