WebTrends: The Measure of Success

This week, I went over some due diligence materials of a private Internet
company. On the top of the pile of papers were the WebTrends reports. It
showed the type of traffic the site was getting.

In fact, just about every private company I’ve worked with relied on
WebTrends reports. Simply put, it is kind of like the Gold Standard of
traffic measurement.

Actually, I had the chance to meet the CEO of the company several years ago.
He gave me a demo of the software and it was definitely cool. He told me, “We are making profits.” Back then, this was
considered kind of crazy. Aren’t you supposed to sustain big losses? If
not, you couldn’t grow fast, right? Well, WebTrends (WEBT)
demonstrates that it has not sacrificed growth.

Now, Webtrends has become a company with a full suite of products, becoming
a leading provider of Visitor Relationship Management solutions and
enterprise management and reporting solutions for Internet and intranet
servers and firewalls. Last year, the company introduced 15 new products and
has also launched a professional services organization.

In the last quarter, sales increased 200 percent to $7.4 million with $1.2
million in earnings. For all of 1999, total revenue increased 146.3 percent to
$19.7 million. Profits were $2.7 million.

Their Net reports are easily accessible online without requiring any
hardware or software investment or log file access. They help Web operators
maximize their Web sites and intranets. The information helps in dealing
with combining sites, eliminating sites not being used, expanding areas with
high user demand and developing guidelines for publishing web content.

WebTrends Live is the industry-first product that correlates e-commerce data
with Web site visitor behavior, helping to generate a ROI for e-marketing
campaigns. These capabilities give e-business managers a solution to help
optimize their Internet investment by providing critical day-to-day
information about their customers, partners and suppliers.

WebTrends has a broad customer mix including ISPs, governments, educational
institutions, and corporate clients. A sampling of customers include:
American Express, AT&T, Cable & Wireless, Comcast, DIGEX, Dow Jones &
Company, EDS, IBM, Microsoft, NASA, USWeb/CKS, and UUNet. Last year,
WebTrends added 10,000 new customers. In fact, in the last quarter, the
company added about 4,000 new customers. In all, the company has 35,000
customers.

Clearly, WebTrends is growing its product line and bottom-line. It’s an
infrastructure play that has a business model that is profitable. It may not
be an exciting business, but it works.


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