Small Auckland company Jericho is living proof of the benefit of treating computing resources in the same way as electricity or water supplies. It is in the happy position - despite the recession - of having an expanding workload, but is coping without the costs and delays of setting up new infrastructure.

Instead, Jericho - an email marketing service company - merely asks its on-demand computing provider to allocate the necessary IT resources to cater to the peaks and troughs of its business. With the economic downturn forcing businesses to work harder to bring customers through the door, Jericho is busier than ever managing their email marketing campaigns from conception to delivery.

"For Jericho it's been a good year, no doubt in part due to being able to scale our offering to meet client demand."

Jericho creative director Andrew Kay

"People are looking a lot harder at their marketing dollar and how they can extract more visibility from that investment," says Jericho co-founder and creative director Andrew Kay. As a result, many of the firm's clients, particularly retailers, are upping the frequency of their email contact with customers, and also varying the content.
"That's resulted in an increase across all facets of our business - from the design and production department through to the end result of more emails."

The core of Jericho's business is SmartMail, its email marketing campaign management and reporting software. Big clients, which include Telecom, Ezibuy and Fly Buys, typically have a full-service arrangement with Jericho, which means Jericho designs the content layout, manages despatch, and reports the results.

Computer grunt is required for message sending and reporting, and for that, Jericho relies on on-demand computing provider Integral Technology Group, an IBM^® Business Partner. It's a year-old relationship that has given Jericho the flexibility to take on a major new client, The Warehouse, without having to spend large sums on additional computer hardware.

Winning The Warehouse business was a direct result of the partnership with Integral and IBM, Kay says. "It was due to our scalability - being able to quickly increase our sending capacity to meet The Warehouse's requirements."

The new business means a 10 percent increase in email volume, but Integral's on-demand model ensures that doesn't come at the cost of Jericho's other customers. Kay says it's merely a matter of activating virtual servers at Integral to deal with the added demand.

Equally, when any client has an unscheduled need to do a big email send-out, as had happened half-a-dozen times in the first few months of the year, additional capacity can be provisioned within as little as an hour for as many as 500,000 messages.

"The relationship with Integral is very fluid so that when we get new clients on board, from signing contracts to the first emails going out can be a turnaround of about a week."

That contrasts with the couple of months it would take to set up and test new systems in-house when added capacity was needed for a customer of The Warehouse's size.

Integral's utility delivery model also means a significant cost saving, says Kay. "We're really starting to see that cost benefit coming through, especially when adding new clients doesn't mean having to invest in new hardware."

That's not to say that Jericho's expansion hasn't required some investment. In the past 12 months, during a time when many companies have had to lay off staff, it has increased its headcount by 30 percent to 26 full-time employees.

"For Jericho it's been a good year, no doubt in part due to being able to scale our offering to meet client demand," says Kay, who sees no negatives in the utility computing model.

"So far, in the year we've been running it, we haven't seen any downsides. For us it really has been a plus."

Jericho wins the Excellence in Business Support Award for the 1 to Many Business Services category (< $5M t/o) at the 2009 Vero Excellence in Business Awards. http://www.marketing.org.nz/cms/News/5425

Jericho took the top prize at the 2007 IBM Business Partner Awards: Integral Technology Group's utility computing solution for email design and delivery specialist. Find out more »

Key Facts

• Company formed in 2000
• Profitable since 2004
• Has 26 employees - six more than a year ago
• Recession-proof profit growing faster than 25 percent
• Handles millions of customer emails a month
• With on-demand infrastructure, has boosted capacity 500 per cent

This customer story is based on information provided by Jericho and illustrates how one organisation uses IBM products. Many factors have contributed to the results and benefits described; IBM does not guarantee comparable results elsewhere.
Warranty, service and support of non-IBM products are provided directly to you by the manufacturer, supplier and publisher of the product. Subject to any rights which may not be excluded or limited, IBM makes no representations or warranties regarding non-IBM products or services.
IBM is the trademark or registered trademark of International Business Machines Corporation in the United States, other countries or both. Other company, product and services marks may be trademarks or services marks of others. ^© Copyright IBM Australia Limited 2009 ABN 79 000 024 733. ^© Copyright IBM New Zealand Limited 2009. ^© Copyright IBM Corporation 2009. All Rights Reserved.
"Business Partner" is used informally and does not imply a legal relationship

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