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Friday, 13 August 2010

IBM Buys Unica: Will Acquisitions Now Shift to B2B Marketing Automation?

Posted on 07:10 by Unknown
IBM announced this morning that it was purchasing enterprise marketing automation leader Unica for $480 million, more than double the company’s current stock market valuation. This is wholly unsurprising: as the last and only big independent left in its space, Unica was obvious acquisition bait. It was also a motivated seller, since it faced an increasingly impossible struggle to fund the product enhancements necessary to compete with the likes of SAS, Teradata and Siebel / Oracle. Conversely, IBM is on a customer intelligence acquisition spree that has already included Coremetrics Web analytics, Sterling Commerce B2B integration and Cognos and SPSS business analytics.

There’s been some comment (I’m looking at you, Jonathan Block of SiriusDecisions) relating the IBM/Unica deal to consolidation with the B2B marketing automation industry. Sorry, but I don’t see a connection. As I discussed in my own post on industry consolidation, Unica belongs to the class of marketing systems that serve consumer marketers. Its acquisition is basically the completion of the consolidation of that space, not the start of consolidation among B2B marketing automation vendors. (I’m overstating a bit: there are a couple of B2C vendors left including Neolane, Alterian and SmartFocus, although the latter two use proprietary database engines that would make them difficult to integrate into a larger enterprise suite. Probably the most prominent survivor is Aprimo, but they’re more B2B.)

If there’s any connection at all, it’s that this acquisition may spur Web content management vendors to accelerate their own acquisition of marketing automation capabilities. I discussed this a bit in my post on Adobe’s acquisition of Day Software and in the industry consolidation post. Given that there are so few B2C marketing automation vendors left, the Web content management players are almost forced to consider buying a B2B marketing automation system. (The other option would be email vendors like ExactTarget and Responsys.)

This isn’t really a bad thing: the B2B marketing automation products have pretty much all the capabilities of the B2C systems and then some. On the other hand, most B2B systems are designed for smaller data volumes and have less flexible data structures.

The bottom line is probably that the upper tier B2B marketing automation vendors (Eloqua, Silverpop, Aprimo, possibly Marketbright) are next in line to be bought. But you already knew that.
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Posted in demand generation, enteprise marketing management, ibm, industry consolidation, low cost marketing software, marketing automation, unica | No comments

Thursday, 12 August 2010

Genius.com Offers Free Edition: How Much Does It Lower True Cost of Entry?

Posted on 07:13 by Unknown
Summary: Genius.com has added a free version of its system. But I think its strategy of offering an intermediate product between email marketing and full marketing automation may actually be more useful in attracting new customers.

On Monday, Genius.com announced “the first free, instant-on demand generation solution”, a description carefully crafted to distinguish their offering from the free version announced by LoopFuse in June. The key term here is “instant-on”, which Genius defines to mean “instantly integrated website tracking, email marketing and social media campaign tracking” along with fully automated integration with Salesforce.com, including custom fields in standard objects. LoopFuse also provides automated Salesforce.com integration, but doesn’t have Genius’s Web tracking technology.

Since Genius has highlighted the issue, let's dive into its Web tracking. How it works it this: Genius creates URLs that send visitors to a proxy server, which in turn forwards their page calls to the client’s actual Web site. The proxy server continues as an intermediary through the entire visit, so it can track all pages the visitor sees. The same method is used in Web advertising, email links and linked embedded within social media messages. Because the tracking is done by the proxy server, there’s no need to make changes (i.e., add a tracking tag) to the Web site itself. This is what makes the tracking truly “instant”.

So far so good, but let’s be clear: the proxy server only captures visits that begin with a Genius-generated URL. So if I respond to a Genius-generated email, all the details of my initial visit are captured. But if I come back later by typing www.genius.com into my browser or searching for Genius on Google, the proxy server isn’t involved and Genius won’t know about me unless a traditional tag has been added to the Web pages. Genius does support such tags but now we’re beyond the realm of “instant on” and, indeed, of the free Genius system.

Genius' tracking technology is clever and unique enough that they’ve been able to patent it. But conventional marketing automation systems automatically track their own emails, landing pages and Web forms, also without touching the corporate Web site. This is not quite as powerful (or cool) as the Genius approach, but does reduce practical difference.

I wouldn’t have gotten into this had Genius not made “first free, instant-on” the focus of its announcement. What really matters is that they have a free offering, which implies two things about the system itself:

- they can provide fully automated, instant provisioning, which means their technology is sophisticated and their operating costs are low.

- the system is easy enough that new clients can use it with a minimum of support. Genius Marketing Vice President Scott Mersy told me yesterday that the company expects most users will learn what they need from a sequence of educational emails and online materials. He did add – and this and this is important – that limited phone support will be available to free users.

What does the free offering mean from an industry standpoint? I discussed this at some length in my June post on the Loopfuse’s free product. Bottom line: a free version will gain vendors some customers they wouldn’t get otherwise, but probably not create a huge difference in their market share or growth of the market itself. A marketing automation system is a highly considered purchase. Buyers recognize they will make a substantial investment in time and materials, so an extended free trial (which is what most free versions boil down to) is just one of many factors they weigh in selecting a starter system. Free systems may also attract companies so small that the free system is all they need. But those companies will never be a source of much revenue, even if the vendors manage to sell them some additional services.

In other words, the true purpose of a free system is to lower buyers' full cost of entry enough to attract a large number of new customers. This cost includes not just the software, but also the time spent to learn and operate the system, to develop new campaigns, and to design new business processes. This is why automated provisioning and self-service support really matter: they imply time savings for the users as well as the vendor.

In terms of entry costs, it's significant that Genius’ free version is based on their “Demand Generation” system, which occupies a middle ground between their “Email Marketing” and “Marketing Automation” products. The company provides a handy comparison table which shows that Demand Generation includes social media and Web tracking, triggered actions, Web forms and progressive profiling, but not drip campaigns, automated lead nurturing, lead scoring and landing pages. That is, it captures and tracks leads but doesn’t do sophisticated lead nurturing. This greatly lowers entry costs by asking users to start with a smaller, simpler set of tasks.

Although competitors will no doubt cite the limits of Genius Demand Generation as a weakness of Genius’ free offering, Mersy said the company will actually make the full Marketing Automation version available to free users who want it. He said they chose to start free users on the simpler system only to simplify their initial deployment.

That’s probably a very clever move – as is offering the Demand Generation version. Many marketing automation vendors have a “lite” system that is similar to the Genius Email Marketing, which includes Web behavior tracking and Salesforce.com integration as well as outbound email. But the next leap is typically to full marketing automation. An intermediate product provides a smoother growth path for marketers who want to start small and slowly expand their marketing automation efforts. This addresses two key obstacles to first-time purchase:

- it lets Genius offer a substantially lower entry price than competitors, without dropping the price of its full system. Starting price of Demand Generation is around $800 per month, slightly higher than the $600 per month of Email Marketing but significantly below $1,100 per month for Marketing Automation.

- it lets marketers grow into the complete system at their own pace, rather than purchasing something that requires extensive campaign development and process redesign to use fully. Of course, marketers could also just not deploy these features in another system, but the psychology of that is quite negative.

It remains to be seen whether having an intermediate Demand Generation product really gives Genius a substantial competitive advantage. If it does, it won't last long because the approach could be easily copied. Still, Demand Generation represents a creative approach to a fundamental challenge in the market. For that reason alone, it’s worth watching.
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Posted in demand generation, freemium, Genius.com, lead management, marketing automation, marketing software | No comments

Wednesday, 11 August 2010

Day Software Acquisition Adds Some Marketing Features to Adobe, But Gaps Remain

Posted on 08:56 by Unknown
Summary: Adobe added Web content management, digital asset management and social media features to its arsenal when it purchased Day Software last month. But it still lacks key pieces of a complete marketing solution.

Last month, Adobe announced their $240 million acquisition of Web content management vendor Day Software. Adobe was already a major force in Web development through its Dreamweaver, Flash and ColdFusion products, not to mention Omniture for Web analytics. But Day fills out its line by adding enterprise-class content management, digital asset management and social (blog, Wiki, etc.) publishing. In fact, the fit is so obvious that it doesn’t seem to have generated much comment, at least among the marketing gurus I read.

But the significance to marketers may be greater than they think. Back in February, Day released its 5.3 version, which specifically aimed at letting marketers manage their Web promotions without help from technical specialists. Of course, this is a goal shared by so many vendors that it verges on cliché. In particular, it’s also one of the main benefits offered by the landing page, Web form and microsite features of marketing automation systems.

Still, as I’ve argued many times, it ultimately makes more sense for marketers to build their pages in the company’s core content management system than in separate marketing automation tools. This can only happen if the content management system provides the features that marketers need to do their jobs.

Day’s 5.3 release attempted to do this by adding targeting capabilities, including segmentation and segment-driven personalization. Segments can be based on anonymous visitor characteristics such as referring site, search keywords and geolocation; on history captured in a registered visitor’s profile; and on attributes of the pages viewed. Profiles can also be enhanced with non-Web data, such as purchase history.

As you might expect, Day does a particularly good job of tracking visitor activities within the Web site. The system uses Javascript on each page to track cursor movements and capture the details of what each visitors has looked at within the page. It can also read the visitor’s browser cache to check for visits to specified external sites, a technique that’s legal although many privacy advocates think it shouldn’t be. The system also supports multi-variate content testing, which can be related to customer segments or operate independently. Tests are judged on click-throughs, which are captured within the system.

Are these features really enough to replace a dedicated marketing automation system? Surely not: marketers still need to maintain a marketing database, send emails, respond to trigger events, score leads, and integrate with CRM. In fact, Day itself expects clients to integrate with marketing automation products for campaign execution. The system does have connectors that let marketers create their emails and Web pages within Day and use an external system to deliver them.

Day’s Chief Marketing Officer Kevin Cochrane told me yesterday that he sees marketing automation as separate from Day’s business of building “customer facing solutions”. But companies that want to integrate all their online (and ultimately offine) marketing will want to combine both sets of features. Although Adobe already owns many tools used in marketing departments, it lacks the campaign management features at the heart of marketing automation. I expect that Adobe and other major Web content management leaders will eventually acquire email and/or marketing automation vendors to fill the remaining gaps.
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Posted in adobe, day software, demand generation, lead management, marketing automation, Web content management | No comments

Tuesday, 10 August 2010

Don't Fix Your Marketing Process

Posted on 14:01 by Unknown
Summary: In a constantly changing world, flexibility is more important than optimization. Marketers need people, processes and technology that allow them to react quickly to new opportunities.

The always-insightful Adam Needles is running a series of blog posts this week that summarize the “real state” of B2B demand generation. So far, his main points have been that the role of B2B marketing has expanded to cover the entire buying cycle from initial lead generation through closed deals and that new technology must be accompanied by changes in people, process and content to have an impact. Tomorrow’s post will apparently discuss the need to tie marketing efforts to revenue.

This is good stuff and well articulated, but industry gurus have been making similar points for a long time. The real question is what to do about it. HOW can marketers adjust their staffing and processes, given the practical constraints of time and budget? And can systems provide specific capabilities that will make the adjustment easier?

The conventional wisdom is that marketers need to become more efficient, more attuned to individual buyers’ movement through the purchase cycle, and better coordinated with sales departments. But although these are certainly valid goals, I think they understate the problem.

Specifically, they make an implicit assumption that marketers are facing a stable situation. This is what allows them to design a new set of processes and techniques optimized for that situation.
I’d argue that the situation is highly unstable. Marketers face continued rapid change in the methods and media they have available. In this situation, any optimized process will rapidly become obsolete. So, the key requirement is flexibility itself. The most successful organizations will be those whose people, processes and technology can most effectively exploit new opportunities as they appear.

(The classic example of the conflict between stability and flexibility is the competition between Ford and General Motors in the 1920’s. Henry Ford relentlessly, even obsessively, optimized his company to make Model T’s more efficiently. But even though Ford kept driving down his costs, he ultimately lost to a General Motors that was able to change its products more quickly. Just thought I’d throw that in there.)

What does an organization optimized for flexibility look like? I think it keeps its processes simple, so they can be easily adjusted. This may mean they’re broken down into many small, connected processes that can be changed individually without affecting the other processes around them. (“Modular” and “loosely coupled” are better terms for this but sound too geeky.)

It certainly means that results are measured closely and frequently, so successes and failures are identified quickly and exploited or discarded as appropriate. It also means the organization makes experimentation easy, in terms of funding, staff time and tolerance for mistakes. It probably suggests that staff members should be more generalists than specialists, which implies greater willingness to pay for training and perhaps wider use of outside resources to provide particular skills on demand.

From a technology standpoint, flexibility implies ease of integration with new data sources, marketing methods and external systems. That’s very different from one vendor trying to include as many functions as possible. (On the other hand, multi-function suites always do seem to win in the market, precisely because they require less integration. Perhaps this will change if integration itself becomes easy enough.)

Flexibility also implies greater ease of use, particularly in terms of setting up and modifying marketing programs and processes. The need for many small, loosely connected processes has some specific implications for interface design. The need for measurement also implies better reporting technologies – a topic that several marketing automation vendors have recently begun to address.

Circling back for a moment to staff skills, all this integration, process coupling and analysis seems to mean that those "generalists" are going to be more technically adept than today's marketers, even if they are not as specialized in terms of the particular media. I'd like to believe that really great technology and interfaces can reduce the level of technical skill required, but suspect that won't happen any time soon.

I’ll admit these are somewhat half-baked notions, since they were largely triggered by Adam’s posts this week. On the other hand, I’ve been thinking for quite some time that we need to move beyond just telling marketers to nail down their processes. Perhaps a recognition that we must manage in a period of continuous change is a good next step.
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Posted in demand generation, lead management, marketing automation, marketing process, marketing systems | No comments

Tuesday, 3 August 2010

Marketo's Enterprise Edition and Revenue Cycle Management: Looking Under the Hood

Posted on 13:27 by Unknown
Summary: Marketo continues to follow its own path. Enterprise Edition adds the complex security needed by large organizations but sticks to simple campaign flows. Revenue Cycle Management blazes an important new trail for others to follow.

I finally caught up with Marketo for a briefing on their Enterprise Edition (announced in March) and Revenue Cycle Analytics (announced in May). Since both are somewhat old news, and Marketo describes them in detail on its Web site, I’ll just make a few comments.

Executive Edition shows what Marketo believes is needed to service large marketing organizations. The most extensive enhancements provide finer-grained control over user rights. This is critical in large organizations, where regional and product groups may be responsible for different market segments and where users will have different functional specialties and approval authorities. Enterprise Edition supports these by adding user roles, “lead partitions” to control access to database segments and “workspaces” to make Marketo objects (contents, campaigns, lists, etc.) available to different user groups. User roles (but not lead partitions or workspaces) are now available in Marketo’s Professional Edition as well.

These changes are a big advance over earlier versions of Marketo, which distinguished only between users and administrators and let all users access pretty much everything. Enterprise Edition also adds a “sandbox” environment for training, testing and development – the sort of things that small companies might do on a live system, but large organizations cannot safely allow.

The other major big-company need that Enterprise addresses is more sophisticated integration with other corporate systems. Related features include LDAP integration with enterprise security systems and a Web services API to call Marketo functions and access its data.

Perhaps most interesting is that Marketo did NOT expand the complexity of its actual campaign flows. These remain fundamentally linear: that is, all leads follow the same flow from step 1 to step 2 to step 3, etc. Rules within each step can deliver different treatments to different segments, but everyone still moves to the same next step unless they leave the campaign altogether. Other enterprise-level marketing automation systems can create different branches within their campaigns, so different segments follow entirely separate paths. This makes it easier to design and visualize fundamentally different treatments for different types of leads, something that matters more in a large enterprise with many different lead types. I’ve always considered branching campaign flows to be one of the key requirements for an enterprise-level marketing automation system. It seems that Marketo disagrees.

(Actually, Marketo disagrees with much of the preceding paragraph. Everything in it is factually accurate, but I'm happy to clarify that (1) several campaigns can run simultaneously, sending leads through different flows and (2) steps within Marketo campaigns can remove leads or send them to other campaigns (3) Marketo can connect several campaigns to produce the same flows as single branching campaign in other systems.)

Revenue Cycle Analytics breaks some important new ground. As I commented in an earlier post on purchase funnel measurement, Marketo’s approach is not conceptually unique. The basic idea is to track leads through stages in a purchase funnel, which is similar to pipeline reporting in many sales automation systems. It just starts earlier in the process.

However, Marketo's implementation brings this reporting to a new level. Most specifically, Marketo has introduced a star-schema reporting database, which I’m pretty sure no other marketing automation system currently offers. (Market2Lead had something similar but is no longer sold.) This is important because the structure of an operational marketing database, which most B2B marketing automation systems also use for reporting, makes it hard or impossible to do the necessary time-based analysis.

Other components are similarly sophisticated. These include graphical models that track movement of leads through the stages, detailed analytics with specialized measures such as conversion rates and speeds, statistical projections based on current inventory and historical flow rates, and executive dashboards. The models capture more than a simple linear pipeline: they support skipping and backwards flows among stages, splits within flows for different lead types, complex stage definitions, and transitional stages where leads are processed and reassigned.

Marketo is also tackling the difficult issue of allocating revenue to multiple individuals and marketing touches. Its methods are not particularly advanced: credit can be spread evenly or based on marketing-assigned weights. But no one else has found a much better solution, particularly at the low volumes of most B2B marketing programs.

My only real complaint is that you can't actually buy it all today. Marketo is releasing Revenue Cycle Analytics in stages. The database itself was available for the May announcement and the modeling engine was released in July. Initial analytics are set for delivery this month (August), with the really cool projections and dashboards out during the first half of next year. This delay could prove costly, since funnel-based marketing measurement is a hot topic and other vendors could well build or partner to deploy something similar in the interim.

Pricing of Revenue Cycle Analytics starts at $1,500 per month and grows with database size. Incidentally, I don’t think they’ve published that figure anywhere before, so there’s a bit of news in this post after all. Huzzah.
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Posted in demand generation, enterprise marketing management, lead management, marketing automation, marketing measurement, marketo, revenue attribution | No comments

Wednesday, 28 July 2010

Manticore Technology Sees Expertise as Key to Success as a Demand Generation Vendor

Posted on 18:23 by Unknown
Summary: Manticore Technology released some modest enhancements to its demand generation platform today. The company takes a conservative approach to marketing automation, stressing the importance of process over flashy software. I’m not sure this will be enough to thrive as the market develops, but customers will benefit regardless.

Manticore Technology today released the latest version of its marketing automation system. Changes include a drag-and-drop design tool (similar to Microsoft Powerpoint); integration of opportunities and custom objects from Salesforce.com; better reporting on Web site visitors; and, real time sales alerts on Web activity.

Each of these makes Manticore a bit more useful but none breaks new ground for the industry. So rather than review them in depth (you can read Manticore’s press release for details), I’ll look at Manticore’s broader business approach as outlined by Marketing Vice President Christopher Doran.

First some background. Manticore launched its B2B marketing automation system in 2003, making it one of the older vendors in the industry. With a $2,000 per month starting price and a solid mix of features, it sits squarely in the middle of the market. The firm has grown steadily but slowly, reaching just under 125 active clients. These include a few very large firms but mostly mid-size businesses and divisions of larger companies. Unlike faster-growing competitors, Manticore has been largely self-funded.

In a stable industry, this would be a comfortably conservative position. But the marketing automation space is changing rapidly. A mid-tier company which is neither growing quickly nor dominating a particular niche could easily be left behind. At least, that's my opinion.

Manticore doesn’t see it this way. According to Doran, the company has found that the real key to success is guiding clients through successful execution of demand generation programs. Manticore wants clients to understand that demand generation is a business process. It positions itself as a "trusted advisor" that sells based on its expertise, not on technology.

Part of this approach is to give clients a methodology. Manticore offers a straightforward one: define the stages in your marketing funnel; benchmark performance at each stage and identify bottlenecks; create transitional content to move prospects into new stages; define nurture programs to reduce bottlenecks; execute the programs; measure the results and compare them with your goals. The product supports this methodology but does not insist on it.

Doran sees Manticore's customer support group as playing a key role in delivering its expertise. Support staff are trained to help clients address their business issues. This fills a key gap between buying the software and hiring an actual marketing consultant. Manticore relies on business partners for such consulting services.

Of course, Manticore recognizes that it cannot succeed unless the product itself remains competitive. As the latest round of enhancements illustrates, Manticore remains focused on the core demand generation features of email, landing pages, lead nurturing and sales integration. The company is avoiding extensive investments in “inbound marketing” technologies such as search engine optimization and paid search advertising. Nor will it expand into marketing resource management features for planning and budgeting. Doran did say he expected to add some social media features and deeper reporting. And the company will continue to stress its traditional message of ease of use – although at this point, most other demand generation vendors make a similar claim.

I remain skeptical about Manticore's approach. It's true that process is more important than technology and that services to new users were the key to success in earlier marketing automation generations. But today there are plenty of consultants and agencies to provide that support, so it's probably not necessary for vendors to do it themselves. As a practical matter, I think most buyers will prefer systems with a broader scope, flashier presentation and more aggressive marketing. But so long as Manticore and similar firms remain financially sound, they can sell to the minority of buyers who understand the value of expert service. Perhaps that's all Manticore really needs.
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Posted in demand generation, lead management, manticore technology, marketing automation, marketing software | No comments

Thursday, 22 July 2010

Marketing Automation Vendor Consolidation: Lessons from History

Posted on 18:39 by Unknown
Summary: consolidation isn't new among marketing software vendors. When campaign management systems consolidated in the late 1990's and early 2000's, most were bought by enterprise software companies. The pattern will likely repeat itself.

As I wrote in my June 30 post on consolidation among marketing automation vendors, I expect the number of competitors to shrink fairly quickly as new buyers concentrate their purchases among a handful of leading vendors. This is a natural result of a maturing market, as technology-oriented pioneers are replaced by buyers less likely to research their options in depth.

But what, exactly, will the consolidation look like? Will weaker marketing automation vendors merge with each other to establish a larger market presence? Will they merge with complementary firms to offer a broader range of capabilities? Will they specialize in particular industries to establish a small but profitable niche? Or will they simply be crushed as giants from related industries introduce their own products?

Let’s look at a similar consolidation about ten years ago, among the original marketing automation vendors.* These were campaign management systems including Exchange Applications, Recognition Systems/Protagona, Prime Response, Intrinsic, Unica, Aprimo, Decision Software TopDog/MarketWide, Alterian and SmartFocus.

The pattern is quite clear. A handful of vendors managed to survive as independent firms. The big winner has been Unica, which competes successfully among high-end buyers. Decision Software has remained a small company while Aprimo is most successful in B2B marketing resource management. Alterian and SmartFocus are also still independent, but are sold largely via marketing service agencies.

The rest of the competitors, including the original market leaders, were nearly all purchased as line extensions by much larger firms. Exchange Applications went to Amdocs, Prime Response went to Chordiant (itself recently purchased by Pegasystems), Protagona was purchased by DoubleClick (now part of Google), Ceres ended up with Teradata, Intrinsic was bought by SAS, Epiphany became part of Infor, Paragren was bought by Siebel (now Oracle). Other, less successful vendors simply vanished. There were no mergers of equals and no one thrived as a specialist in a particular industry. Although Unica, Alterian and SmartFocus have purchased complementary products, these were extensions around the campaign management core.

Although the world has certainly changed since the late 1990’s, I see no reason to expect a different pattern among demand generation vendors. A few might survive as independents serving the most sophisticated clients. Eloqua and Silverpop are the obvious candidates. Of the remainder, the stronger firms will probably be purchased by companies seeking enter the demand generation space, and the weaker firms will quietly go out of business or be purchased for their client lists.

The more interesting question is who will be the buyers. The obvious candidates are CRM vendors. Of course, Oracle has already made its move by purchasing Market2Lead's intellectual assets. Salesforce.com is the big question and no one would be surprised to see them make an acquisition. Enterprise software vendors like SAP and Infor are also likely buyers. Microsoft is another possibility, although its Dynamics CRM is sold mostly to smaller businesses than the typical marketing automation system. Speaking of small business suppliers, Google and Intuit are long-shot contenders.

Email marketing is another obvious adjacent space. Again, there was already one transaction: Silverpop/Vtrenz in 2007. The potential margins from marketing automation probably look relatively attractive to email vendors. The problem here may be that the independent email service providers (ExactTarget, Responsys, Vertical Response) are relatively small companies themselves, so it might be hard for them to make a substantial investment. On the other hand, as the consolidation proceeds, small marketing automation companies may get pretty cheap.

Finally, we come to Web marketing companies. These include content management systems (Autonomy Interwoven, EMC Documentum, OpenText, etc.) and Web analytics (Adobe Omniture, IBM Coremetrics, WebTrends). Note that many of these are already part of larger suites whose owners could easily afford a marketing automation acquisition. A couple of smaller Web content management firms (Marqui, SiteCore) have already moved towards marketing automation. One challenge faced by the smaller Web marketing companies is that their customers (Web site managers and analysts) are generally not the buyers for marketing automation. Even “inbound marketing” (search engine optimization, keyword advertising, Web display ads) is often done by someone other than the marketing automation user. This is less of an issue for larger firms, who have relationships throughout their clients’ organizations.

Incidentally, not everyone agrees that smaller marketing automation vendors must vanish. I had a conversation today with one vendor who argued that success still depends mostly on helping new users get value from their systems. In this view, small vendors can succeed by providing excellent service and support, as well as by linking with marketing agencies and consultancies. This could certainly be a niche – remember that Alterian and SmartFocus survived by working through service providers. Still, I ultimately expect that most mid- and large-size firms will purchase marketing automation as part of a larger software suite, and thus that independent marketing automation vendors will find it increasingly tough to survive.

_______________________________________________________________
*Actually, there was a previous class of “database marketing” systems including Customer Insight Company, OKRA Marketing, Harte-Hanks P/CIS, Max$ell and RTMS. These used proprietary, non-SQL database engines. Most were purchased by larger companies and then discarded when adequate systems using standard SQL databases became available. Alterian and SmartFocus, both descended from Brann Viper, still survive.
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Posted in campaign management, demand generation, market consolidation, marketing automation, marketing software | No comments
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  • birst
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  • net promoter score
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  • role of experts
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  • salesforce acquires exacttarget
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  • score cards
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  • setlogik
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  • sisense prismcubed
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  • Spredfast
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  • treehouse international
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