About
The Echo System offers an SaaS-delivered social media analytics and engagement platform that resides on the back end of consumer-branded home pages. Through its proprietary software, the company can provide a rich social media data analytics set to the brand in order to improve yield management, including advertising ROI, targeting certain types of social users/demographics, increasing product awareness, optimizing product or page views, and driving campaigns to increase customer lifetime value. The Echo System is the only social media analytics company that can inform a brand what a social media user is worth to that brand (true ROI) and drive engagement with that brand based on what type of user is visiting a site.
Thesis
As the world increasingly moves toward social media as a platform for customer awareness and engagement, measurable ROI within social media advertising will become exceptionally important for consumer brands. The Echo System is the only company today that can not only measure this ROI in specific dollar terms, but can also increase ROI through its suite of engagement tools.
People
All four founders of The Echo System were also involved in the founding and rapid growth of Resolution Media, a Chicago-based digital marketing firm that was sold to Omnicom in 2005.
Management Team
- Lance Neuhauser, CEO
- Co-founder of Resolution; established Resolution's NY office
- David Barnes, CTO
- Instrumental in creating Omnicom Media's ERP/CRM
- Zak Knudson, VP of Product & User Experience
- Founded Search Centre for Omnicom UK
- Andrew Chomer, Chief Revenue Officer
- Ran Global Partnerships for Resolution
Product
The Echo System offers three user-facing tools: 1) Social Center, which is a popout on a brand's home page the prompts social engagement ("Like," "Connect," "Follow"); 2) EchoShare, which allows a user to advocate for brand or specific products by posting to a Facebook wall, a friend's Facebook wall, Twitter, or email; and 3) EchoAsk, which allows a user to ask Facebook or Twitter friends what they think of certain products. Additionally, the company offers two client-facing tools: 1) Social Dashboard, which provides rich demographic and site analytics; and 2) the Echo Effect Score, a proprietary scoring method that indexes, identifies, and targets top brand influencers.
Potential
Social marketing is expected to reach $3.1 billion by 2014, a CAGR of 34% from today (Forrester Research, August 2011). Additionally, almost 8% of U.S. retail sales today are transacted via e-commerce, representing almost $14 billion (InternetRetailer.com, October 2011). Critically, this market is very under-penetrated; among Fortune 100 companies, two-thirds report that social media comprises less than 5% of their marketing spend today. Within three years, that figure is projected to climb to 10-20% (Booz/Buddy Media study, 2011).
How Big Can This Be?
The Echo System could be the leader in social media analytics and engagement. Measurable ROI is the "holy grail" of advertising and brand engagement, and as the world moves to an increasingly social modality, The Echo System should prove to be of critical importance to the world's leading consumer brands.
Predictability
The world is becoming increasingly social, and The Echo System is strongly positioned to offer a unique value proposition to brands that use Facebook and Twitter for customer engagement. No other company can provide measurable ROI and such rich analytics in the social media space. Early traction with customers has proven the strength of this value proposition. By engaging potential customers in-part with a pay-for-performance model, The Echo System has also created a selling model that makes it difficult for customers to "say no." Additionally, the company enjoys a true network effects model with a platform that becomes "smarter" over time: the more data it can analyze for a brand, the more effective engagements that brand can achieve.
Risks
Rapid company growth implies the need to get the customer experience perfect. Additionally, there are bigger, better-funded, and more well-known competitors that may enter this space. Finally, given The Echo System's growth phase, the company needs to have an excellent grasp of the technological requirements attendant with this growth.
