RealTime IT News

eGain: An offer you can't refuse

New-aged Internet metrics are taking over. Market valuations and volatility are often functions of metrics such as page views, unique monthly visitors, and the number of registered users at a site. Of course I'm guilty as well. New metrics have to be created to explain and support the business models of companies that carry the growth of the 21st century economy on their backs, but deliver little or nothing with regard to profitsfor the time being.

Still, there are companies in the Internet space that currently display strong and consistent revenue channels, and it's evident that their model will lead to profitability. Many of these companies can be found in the Business Services sector. Companies within this sector provide such things as email management solutions, Web site hosting, application services, and content aggregation to corporate customers. High-profile names include Exodus Communications (EXDS) , Critical Path Inc. (CPTH) , and Navisite Inc. (NAVI) among others.

These companies provide out-sourced solutions that save their customers time and money, while increasing efficiency and productivity. I came across such a company last August while attending the Internet World summer conference in Chicago. The technology and services being displayed by then-private eGain Communications (EGAN) had me in awe, to say the least. It quickly came to me that etailers and other high traffic Web sites would increasingly rely upon EGAN's email management system and customer support solution to add value to the company/customer relationship. Indeed, the potential for recurring revenue, while cutting costs and increasing productivity seemed enormous.

After arriving back home, I decided to research the space. Quickly, I uncovered an even more established company that was also private at the time, Kana Communications (KANA) .

Kana provides email management systems for Web companies that receive massive amounts of email inquiries from customers and clients. In addition, Kana supports Web site-based communication capabilities for its customers. Sound interesting? Maybe not yet, but the service has become a key ingredient for the success of hundreds of Web companies, including eBay (EBAY) which now handles more than 100,000 emails per week.

How It Works An email management system from Kana holds a knowledge base, which is basically a database of potential answers and/or responses to expected queries from customers. After reading a new email message, the system will dig into this database for a potential response. If the artificial "agent" can find an answer in the database, the system may trigger an automated response to the customer's inquiry. If no appropriate answer can be found, the artificial agent will then pass the inquiry on to a real-life customer-service representative who is best prepared to answer that specific question. The routing method adds value while saving time and money. Real life agents only receive questions they know they'll be able to answer. In addition, all emails and correspondence are kept on file, adding organization, depth, and personalization to the company/customer relationship.

Corporate Value The average customer service rep might be able