Group 1 Software: High Cost of Quality

By Baselinemag  |  Posted 2003-12-01 Print this article Print

Group 1 Software's customers say the company's software is great at handling international data, but hold out hope the technology will get easier to use.

Who says companies are no longer willing to buy high-priced software? Many Group 1 customers say they have no problem demonstrating a payoff from the ways its Code-1 Plus and DataSight software clean up messy mailing lists and databases.

Sure, buyers are not thrilled about the costly expenditure. Prices for the top-of-the-line product, DataSight, start at $200,000 for a one-time license plus annual maintenance of $33,000 (based on a fee of 16.5%)—nearly the same rates as rival Trillium and well above those of another, Firstlogic, customers say.

"The software costs a lot, so we do a [return-on-investment] analysis every year," says Rick Lemp, senior information-technology manager at Maritz Inc., a provider of direct-marketing and consumer research to the travel industry. "If we didn't think it was worth it, we wouldn't be buying it."

On a recent 12-million-piece direct-mail campaign, Lemp estimates that using Group 1 products to spot and eliminate duplicate names and fix and enhance faulty addresses saved more than $500,000. Maritz identified 8% of the names on the mailing list as duplicates and eliminated them.

Emerson Process Management, a manufacturer, wanted to consolidate data from 70 business units scattered worldwide and spot customers doing business with more than one unit, which required eliminating conflicts in customer-address information. "We looked at Trillium and Firstlogic, but the deciding factor was that Group 1's international data was better," says Nancy Rybeck, Emerson's customer data warehouse strategy architect.

Still, even satisified customers say Group 1 products should be easier to use. Schroeder Publishing, for example, has been using Code-1 Plus since the early 1990s to clean up customer-address information in direct-mail files and to append "ZIP-Code-plus-four" data where it doesn't exist, says direct-mail supervisor Terry Guill. Code-1 Plus is unnecessarily complex, making it hard for non-experts to navigate and use different functions, Guill says.

Group 1 acquired technology from data-integration software vendor Sagent Technology that may help address that shortcoming. Group 1's DataSight interface was basically character-based, requiring customers to enter strings of commands to run the software. The new interface will allow customers to click on icons instead, requiring less training.

Group 1 Software
4200 Parliament Pl., Suite 600, Lanham, MD 20706
(301) 731-2300 www.g1.com

Ticker: GSOF
Exchange: NASDAQ
Employees: 600

Robert S. Bowen
CEO, Vice Chairman
Has been chairman and CEO since 1984. He's held senior management positions at Firestone and Zenith Electronics.

Mark D. Funston
Executive VP, CFO
Before joining Group 1 in 1996, he was CFO of Comsat RSI (a division of Comsat Inc.) and of Radiation Systems.

Andrew W. Naden
Executive VP, Enterprise Solutions Sales
Oversees domestic marketing and sales operations functions for Enterprise Solutions unit.

DataSight validates, parses, matches and consolidates data; the tool appends records with extended ZIP codes, geographic, telephone and tax-jurisdiction data. Code-1 Plus validates addresses; Data Quality Connector works with Siebel's CRM applications.

Reference Checks

Nielsen Media Research
Russell Orth
Lead Developer
Project: Uses Code-1 Plus to validate and correct addresses before sending viewing diaries to participants in the company's television-ratings survey.

RSA Security
John Ma
Manager, IS Applications
(781) 515-5000
Project: Uses Code-1 Plus to clean up customer data fed into a Siebel customer-resource-management application.

Schroeder Publishing Co.
Terry Guill
Direct Mail Supervisor
Project: Deploys Code-1 Plus to clean up customer database and add "ZIP-plus-4" data to addresses to increase percentage of successful direct-mail deliveries.

Maritz Inc.
Rick Lemp
Senior I.T. Manager
(636) 827-4000
Project: Market-research firm uses Code-1 Plus to weed out duplicate customer records.

Emerson Process Management
Nancy Rybeck
Customer Data Warehouse Strategy Architect
Project: Selected Group 1 because of superior international-address support.

Diversified Business Communications
Pauline McNeil
Data Services Manager
Project: Deployed Code-1 Plus, Code-1 Plus International and Merge/Purge packages earlier this year after taking the company's database and direct-mail-marketing operations away from an outsourcer.

Executives listed here are all users of Group 1 Software's products. Their willingness to talk has been confirmed by Baseline.


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