Columbia House Provides Exceptional Customer Service with KANA; Service and Satisfaction Levels Dramatically Increase as Customer Base Doubles.

Business/Technology Editors

MENLO PARK, Calif.--(BUSINESS WIRE)--Aug. 6, 2001

KANA (NASDAQ:KANA), the leading provider of next generation eCRM solutions, today announced that as a result of KANA Response, Columbia House anticipates a 20 percent increase in customer service representative (CSR) productivity and KANA has already helped Columbia House manage a 100 percent increase in Web site customer interaction.

Timely and accurate response to customers plays an integral role in the success of Columbia House. With membership in its Music, Video and DVD clubs on the rise, the company needed a solution that would maintain its high standard of customer service, without having to drastically increase the size of its contact center. Columbia House found in KANA Response the ability to manage the influx of requests and decrease response time, even as the customer base doubled in size.

"As our membership numbers rapidly increased, we realized that our own home-grown e-mail solution was not enough to manage the growing volume of customer inquiries," said Susan Summers, director of customer service for Columbia House. "With KANA Response, our team of 57 CSRs now function in a streamlined business process, benefitting from workflow management, reporting and productivity tools."

KANA Response is a Web-architected solution that enables Columbia House to interact with customers personally and consistently. A positive customer relationship is fostered by the following functionalities of KANA Response:

-- Easy-to-use workflow capabilities that assure consistent, high-quality
responses no matter which agent handles the inquiry. With its extensive set of
customizable rules, KANA Response workflow automatically determines the action
to apply to a response such as automatically acknowledging the inquiry,
automatically routing the inquiry to a particular work queue, or automatically
suggesting a solution.

-- Customer management capabilities that provide a global view of a customer's
profile and interaction history and consolidate information across
communication channels empowering agents to provide the most appropriate
response to an inquiry.

-- Collaboration capabilities to ensure consistent and timely responses that
meet service level requirements. When more complex inquiries demand interaction
with someone outside the contact center, agents have immediate access to KANA
Response's collaboration tools so that they can work with other departments and
even external parties to complete an inquiry.

"Organizations like Columbia House who need to manage an active customer base choose to partner with KANA to expedite the contact center response process," said David Milam, executive vice president of marketing for KANA. "KANA Response has allowed Columbia House to retain control of the customer experience even as the volume of customer questions have doubled in size. KANA's ultra-scaleable solutions offer Columbia House the ability to offer the highest level of service, even as its customer base continues to increase."

About Columbia House

The Columbia House Company is the world's largest direct marketer of music, videos and DVD home entertainment product. With more than 16 million offline and online club members in the United States, Canada and Mexico, the company provides direct-to-consumer marketing of more than 12,000 music titles and 5,000 video and DVD titles through its entertainment clubs. The company's Website, www.columbiahouse.com, is one of the premier e-commerce brands and consistently ranks among the Web's top 25 shopping destinations. Since its inception in 1955, The Columbia House Company has a proven record of excellence in database marketing, market segmentation, credit screening and niche market merchandising. Headquartered in New York City, The Columbia House Company is a general partnership owned equally by Sony Corporation and AOL/Time Warner, Inc.

About KANA

KANA (NASDAQ: KANA) provides the industry's leading eCRM solutions to the largest businesses in the world, helping them to better service, market to, and understand their customer and partners, while improving results and decreasing costs in contact centers and marketing departments. Through comprehensive multi-channel customer relationship management that combines the best-in-class KANA eCRM Architecture with enterprise applications, KANA has become the fastest-growing provider of next generation eCRM technology. The company's customer-focused service, marketing and commerce software applications enable organizations to improve customer and partner relationships by enabling them to productively interact when, where and how they want - across all touch points, including web contact, web collaboration, e-mail, and telephone. KANA's global customer base includes Global 2000 organizations in the financial services, manufacturing, high technology, communications, retail and services markets. ADP, Chase, E*Trade, GAP, GM, Hewlett-Packard, Kodak, Sony, United Airlines, Verizon, and Williams Sonoma are among the Industry leaders that have implemented KANA's eCRM solutions. KANA has locations in 22 countries worldwide, in addition to an extensive global network of channel partners. For more information, please visit www.kana.com.

Cautionary Note Regarding Forward-looking Statements Under the Private Securities Litigation Reform Act of 1995:

Information in this release that involves KANA's financial forecasts, projections, expectations, beliefs, hopes, plans, intentions or strategies regarding the future are forward-looking statements that involve risks and uncertainties. These statements may include statements about KANA's strategies in the marketplace, its market position and its relationship with customers. All forward-looking statements included in this release are based upon information available to KANA as of the date of the release, which may likely change, and we assume no obligation to update any such forward-looking statement. These statements are not guarantees of future performance and actual results could differ materially from our current expectations. Factors that could cause or contribute to such differences include, but are not limited to, risks associated with the merger with Broadbase and integration of the companies; slowing economic conditions; competition in each of our marketplace; risks associated with the evolving and varying demand for eCRM customer communication and similar software; lack of market acceptance of KANA's products or services; inability to integrate and enhance existing products and services within budget and on schedule, and develop new products and services on a timely basis; introduction of new products or services by competitors; inability to attract and retain qualified employees; the ability to manage cash and expenditures; KANA's history of losses; the ability to expand sales; inability to manage business in light of recent management changes and personnel reductions; litigation over property rights; and general economic factors, particularly as it affects spending by our prospective customers on software products such as ours. These and other factors are risks associated with our business that may affect our operating results are discussed in KANA's filings with the Securities and Exchange Commission ("SEC"), including our most recent annual report on Form 10-K and quarterly report on Form 10-Q, and registration statement on Form S-4.

NOTE: KANA is a registered trademark and KANA Software and the KANA logo are trademarks of KANA Software, Inc. All other company and product names may be trademarks of their respective owners.