Brands and businesses have a difficult decision to make about the cloud. Web-hosted services and storage have been at the heart of the digital transformation of today’s economy, but concerns over security are growing, especially after leaks of celebrities’ nude photos, allegedly from Apple iCloud, and debates about government spying revealed by intelligence whistleblower Edward Snowden.
News UK CMO Chris Duncan is an advocate of cloud technology, which proved pivotal in The Times’ and The Sunday Times’ move behind a paywall in 2010. He says:
“I used to spend time worrying about forecasting how much kit we needed to buy, and then at regular intervals we had to stop our marketing activity because we needed to upgrade the kit. I don’t worry about hitting capacity now.”
However, not all marketers are convinced about the cloud. A study by BT in September suggests that trust in data security in the cloud is at an all time low among IT decision makers. So do the advantages outweigh the concerns? Do the services that the cloud allows brands to provide trump the possible reputation damage for marketers?
Service consistency at scale
Despite the concerns, most brands that Marketing Week spoke to think they do. One cited advantage of the cloud is scalability, which also translates into cost savings. Wauwaa, an online baby products brand that launched in the UK in 2013, hosts all of its technology and marketing automation in the cloud through Bronto Software. Chief executive Ivan Lopez says the technology is allowing the business to grow quickly and easily without significant expenditures.
“Using the cloud means businesses can scale based on what their requirements are, as opposed to second guessing and setting up infrastructures that they think they need, but may in reality never use.”
He adds that the technology also helps Wauwaa to improve the customer experience. “For instance, the cloud allows us to dramatically improve content load times, streamHD-quality video and dynamically detect and serve the right content to the device our customers are viewing it on without investing in a single server.”
The ability to grow without having to continually invest in additional hardware makes a business more agile and marketers are able to adapt the proposition according to market demand. Online beauty retailer Feelunique.com started working with Zendesk’s cloud-based customer service software two years ago. It has launched a net promoter score tool on its website to gather customer feedback, and will introduce live customer forums soon.
Feelunique.com operations director Craig Wheeler says the freedom and flexibility of the cloud surpasses that of internal systems. “When I want to roll out something new like customer forums, I can do that without any IT involvement – I haven’t had to consider whether to buy a new server or memory.”
How Bestival’s site coped with 500% growth
Music festival Bestival takes place in September on the Isle of Wight. Since its launch in 2004, attendance has grown by 500%. Its popularity has placed a huge demand on the IT infrastructure that underpins its website, which is critical to the event’s success.
Bruce Hay, head of digital, says: “We needed to look at a new system to manage the huge traffic surges we were experiencing with line-up announcements, the build-up to the festival and other key calendar points throughout the year from our rapidly growing global audience.”
Cloud technology supplied a fitting solution, offering the flexibility to easily add extra resource to meet anticipated traffic surges. Hay says: “It also meant we weren’t competing with other users like we did on our previous shared servers. It enabled us to keep the website running without any downtime during these busy periods. Crucially, it also allowed us to easily make changes and updates to
the website even when we were being hit by huge surges.”
The solution has enabled Bestival to offer a seamless experience to customers, allowing them to use the website without any delays, and ensuring that graphics display and load properly. “Given the creative nature of what we do with Bestival, digitally the creative graphic elements on the website are sometimes as important as the content,” he says.
With 55,000 people attending Bestival this year, its popularity is set to continue. “As our global audience continues to grow, we needed a platform that coped with traffic growth year-on-year and this system has enabled us to do that,” says Hay.
Flexibility to meet demand
Having the ability to scale without expenditure on hardware was central to the launch of News UK’s paywall, enabling readers to buy bundled subscriptions of digital access to content on various days, or a combination of print and digital access. Duncan says that when it launched, trying to forecast the size of the subscriber base and the capacity required five years down the line was difficult.
When the paywall went live it experienced teething problems, with the digital subscriber base growing ahead of expectations to 150,000 within a year, a problem exacerbated by large peaks in traffic on Sunday mornings between 8am and 10am as The Sunday Times readers logged on. The company’s legacy data centre system could not cope. As a result, News UK moved everything that was customer-facing into a cloud environment.
News UK IT director Chris Birch says: “It’s difficult to make a million-pound investment in infrastructure in a business that may not take off. We could have spent that on the existing data centre and it would have been busy for two hours a week – between 8am and 10am on Sundays. The [cloud-based] infrastructure spins itself up to meet that Sunday morning peak demand and closes itself down to a couple of servers to power
it through the rest of the week.”
Last year, News UK also launched a paywall on The Sun’s website. The cloud now handles the company’s frequent peaks in traffic, such as the surge in activity that surrounds The Sun’s Fantasy Football Dream Team game. “Two days before the
start of the football season we see hundreds of thousands of people sign up,” says Duncan. “Two days later it might be only 500 people signing up. You need systems that can scale to that capacity and flex up and down as the business needs.”
Organic skincare retailer Neal’s Yard is also seeing agility benefits, working with Cybertill’s cloud-based retail software. The retailer uses a promotion engine to manage in-store offers, allowing it to offer centralised, regional and individualised promotions.
Jason Cook, head of IT at Neal’s Yard, says: “We don’t have to wait overnight for the shops to download the promotion, they go live immediately.” The technology also allows the retailer to respond quickly to events. “For instance, if a particular natural remedy were to become popular in the press, we could choose to instantly run a promotion on that product, which is deployed across all stores,” he says.
Agility extends to being able to test and implement changes quickly. Duncan says News UK is constantly testing across The Sun and The Times, which run on the same platforms and share customer behaviour insights across the teams.
“We test multiple versions of the acquisition site, for example what happens if we provide more information earlier on in the journey or if we signpost in a different way or even change the colour of certain buttons,” says Duncan. “It is all about crunching out an extra half a per cent here and half a per cent there, and over the past couple of years that has made a massive difference to the effectiveness of that buying journey. Very small gains make a huge difference to our net growth.”
While the manifold benefits are clear, the cloud can also cause hiccups. Wauwaa’s Lopez says: “Down time and major outages that have a ripple effect, such as the loss of connectivity to a certain data centre or facility, can be a pain point when using the cloud. Often, unless you have a good ongoing dialogue with your provider, it can be difficult to know exactly how your system could be affected.”
Minimising outages – and reacting quickly when they do happen – is important for marketers, who will undoubtedly be in the firing line if customers are unable to use a service or find it unreliable. To mitigate this risk, Wauwaa has four back-up systems. Should part of its site go down, its users would experience only a momentary loss of service.
“A few years ago, you would see cloud providers announcing that they would go down for four hours – customers don’t want to hear that. That worry still exists with some providers; businesses need to be wary and ask about downtime,” adds Lopez.
Despite surveys suggesting that many businesses are frozen in fear by the cloud’s associated security risks, there is a pragmatic response. “Wherever sensitive data is stored, it will always be at risk and it could be argued that cloud companies are better at security as they have more to lose through poor security, and therefore invest more time and money in ensuring that their systems are protected,” says Neal’s Yard’s Cook.
Wauwaa’s Lopez agrees that “IT security in the cloud is probably greater than data being stored on your own servers”.
Duncan at News UK adds: “I used to have my data physically sat in contact centre operations that I didn’t own, run by people I didn’t know. Every hardware and software configuration has an element of risk because you are holding personal data, but I would rather be sat on a cloud system where ultimately that business is dependent on its ability to provide security, than in a medium-sized contact centre operation where one guy maintains the servers every month.”
His colleague Birch says he speaks to many IT directors who say they do not encrypt customer data held in their own data centre, but would encrypt it if they moved to the cloud. “I find it odd that people are lulled into a false sense of security in their own data centre. If the information is that important, treat it the same in your data centre as you would in the cloud.”
How does Bookatable use cloud technology?
Bookatable provides cloud-based web solutions for restaurants to accept and grow their online reservations, manage guest marketing, table plans, reporting, etc. Bookatable also uses a variety of third-party cloud-based services to help run its business and technical operations.
What are the advantages of the cloud?
Our web-based solutions enable our customers to access their applications and their data from any device connected to the internet. They don’t need to install any software on their device, and they automatically receive regular product enhancements from Bookatable. Having a cloud-based solution is also invaluable for restaurants that use a variety of smartphone, tablet and desktop devices to access their Bookatable reservation system, including remote access to their data.
How does the cloud enable Bookatable’s marketing?
Our real-time restaurant availability allows customers to see up-to-the minute booking availability, which is reflected on our smartphone apps and website.
As a cloud-based business, Bookatable employees are accustomed to using business solutions such as Salesforce.com for managing sales leads and our restaurant clients benefit from our fully cloud-based Electronic Reservation Book. This helps them to manage their bookings and restaurant floor, and to successfully fill tables when needed. Cloud-based technology helps us to keep pace with customer demand generated by successful marketing or social media campaigns by dynamically adjusting our environment to meet the load.
How have you maximised security in the cloud?
Bookatable uses a combination of its own hosted infrastructure and cloud-based storage, although directionally we are moving more of our infrastructure to Amazon Web Services over time. We facilitate about 20 million reservations per year, and our services have been used by more than 3 million diners, so we have a lot of data to protect. We use several techniques and internal controls to limit access to this data.