Who’s Winning and Losing in Marketing Automation? Fall 2014 Round-up

by Dan Freeman 
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One of the most important metrics in evaluating the ultimate value of any cloud software product is the customer retention rate, a number that encapsulates the value obtained versus client expectations. Retention rate takes into account usability, support, expectations set, and impact on marketing and/or revenue goals. Companies that receive value in excess of expectations generally renew; those that don’t opt out.

Download a Just Revised Marketing Automation Industry Report Covering Marketo, Eloqua, Pardot Act-On, Infusionsoft, Salesfusion and many others.

Though a valuable indicator for customers considering an investment in marketing automation, don’t expect marketing automation vendors to divulge much about retention. They sometimes publish the number and growth rate of their customer base but not a single one lets on to retention rate, or its inverse—churn.

Not to worry. Another class of marketing technology companies can shed light on the magic retention metric.

Software tracking company Datanyze scans over 18 million of the world’s most-trafficked websites, hunting for JavaScript embeds and web tags that indicate the presence of hosted software—in this case a marketing automation platform. The chart below shows the total number of websites using selected marketing automation platforms as of 9/1/14.

Note that websites do not equate with customers as a single customer may use marketing automation software on dozens or even hundreds of websites. Nevertheless, website count is a good indicator of success.

But not so fast...

It’s not just absolute website count but rather the changes—the additions and loses over time—that are the strongest indication of platform success in the marketplace.

I analyzed the top 20 firms for which we have data—and which fall roughly into the marketing automation space—and calculated the percent change in websites using their software since January 1, 2014.

Change happens quickly in dynamic markets. Demand for marketing automation software is growing overall but aggregates mask marketplace turbulence. According to the data, only two of the 20 firms—Pardot and Act-On—have increased their website count by more than ten percent since the beginning of 2014. Seven of the 20 platforms have actually lost websites, a few by over 20 percent.

The data also implies that churn is higher than many would believe. For the 20 marketing automation platforms, the aggregate ratio of websites adds to drops for the first eight months of 2014 was 1.08, meaning that for every 100 websites that added a marketing automation platform, 92 websites dropped one.

Note that the Datanyze metrics are an indication only only and are by no means a definitive measure of software presence. A few caveats of this data are in order and can be found here.

Great marketing can generate a steady stream of new customers in a growing market, but only positive customer experiences will result in high retention rates. Caveats aside, one thing is clear; rapid change is ahead in the marketing automation sector.

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Marketing Growth Strategies LLC has been engaged in research, analysis, lead generation, and client implementation in the Marketing Automation sector since 2009 and has recently revised its highly successful 2014 Marketing Automation eBook.

Considering implementing marketing automation? Download the 2014 Marketing Automation eBook

Venture Capital Investment in Marketing Automation On Pace For Record Year

by Dan Freeman 
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Two financings last week signaled a record pace this year for venture capital investment in the red-hot marketing automation sector. Autopilot—“Marketing Automation for Agile Marketers”—announced that it raised a $10 million Series B funding round led by Rembrandt Venture Partners. Also last week, Captora, a company led by former Marketo and SuccessFactors executive Paul Albright, announced that it raised $22 million in Series B funding.

Whereas Autopilot features traditional marketing automation functionality such as lead capture and nurturing, email marketing, and lead scoring (see an Autopilot overview), Captora is focused on the top of the funnel—securing more inbound leads by automatically generating custom landing pages that match keywords used in searches (see a Captora overview).  These two financings add to an already robust year for venture capital investment in marketing automation technology.

Selected VC Financings for Marketing Automation in 2014

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Over that past 10 years, nearly $700 million in venture capital has gone into the marketing automation sector, including $126 million so far in 2014.

Mergers and Acquisitions in Marketing Automation Continues Strong As Well

Since 2010, there have been nearly $7.5 billion of marketing automation acquisitions; $750 million in 2014 including IBM's $300 million acquisition in April of this year.

Maximize your company value--let us help you position your products within the complex marketing ecosystem, drive new revenue, and reach high value alliance partners. Create thought leadership--white papers, eBooks, webinars, Newsletters. Contact me now. 

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Marketing Growth Strategies LLC has been engaged in research, analysis, lead generation, and client implementation in the Marketing Automation sector since 2009 and has recently revised its highly successful 2014 Marketing Automation eBook.

Are you a marketing automation vendor? Learn about the capturing up to 500 fresh Marketing Automation leads.

Considering implementing marketing automation? Download the 2014 Marketing Automation Industry Report

LeadRocket/Genius Acquired by SaaS Vendor CallidusCloud

by Dan Freeman 
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Last week, Marketing automation vendor LeadRocket (formerly, Genius) was acquired by Callidus Software Inc., which also owns LeadFormix, for an undisclosed amount. This announcement came a week after Salesfusion’s acquisition of Loopfuse (Salesfusion raised $8.25 million in venture capital just two weeks prior). As marketing automation catches on, and as more software firms—we count over 50—chase an expanding customer base, we will continue to see more consolidation.

The LeadRocket acquisition is notable as Genius was the an early leader in marketing automation—they raised over $40 million in venture capital between 2006 and 2009—more than any other marketing automation vendor during that time frame.

Venture Capital Funding for Marketing Automation (2005 - Current)

The publicly traded Callidus CALD acquired marketing automation vendor LeadFormix in 2012 for $9 million. Its full product suite provides Software as a Service (SaaS) for hiring, learning, marketing and selling.

So many factors come into play in determining vendor success; product features, usability, marketing prowess, pricing, support, company leadership, strategy, etc. These factors will sort themselves out through tens of thousands of marketplace experiments over the next year as users attempt to leverage marketing technologies to get a handle on the new world of digital marketing.

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Marketing Growth Strategies LLC has been engaged in research, analysis, lead generation, and client implementation in the Marketing Automation sector since 2009 and has recently revised its highly successful 2014 Marketing Automation eBook.

Are you a marketing automation vendor? Learn about the capturing up to 500 fresh Marketing Automation leads.

Considering implementing marketing automation? Download the 2014 Marketing Automation eBook.

Salesfusion Buys Loopfuse

by Dan Freeman 
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Atlanta-based marketing automation vendor Salesfusion announced this morning the acquisition of LoopFuse, another marketing automation company, also based in Atlanta. The terms of the deal were not disclosed.  Reflecting the rapid change in the marketing automation sector, this news comes two weeks after Salesfusion raised $8.25 million in a Series B financing round. According to the Salesfusion website,

“Salesfusion expects to more than triple sales, revenue, and customers by the end of the year.”

As adoption of marketing technologies accelerate, venture capital continues to flow into marketing automation.

More from the Salesfusion website;

Acquiring LoopFuse has significant implications for Salesfusion and the entire marketing automation space. Salesfusion is embedding LoopFuse’s dynamic social media publishing and monitoring tools directly into the Salesfusion suite of products adding social listening, publishing and nurturing to the leading marketing automation suite for midsized businesses. Expanding on current Loopfuse technology, Salesfusion will be the first provider to bring the power of predictive analytics to marketing automation, arming marketers with the first “smart” marketing automation solution and enabling them to interact with and nurture prospects and customers in a more efficient, intelligent way.
The addition of LoopFuse customers to the Salesfusion portfolio makes Salesfusion one of the largest marketing automation software vendors focused specifically on the midmarket segment, overtaking several competitors. Pease and Young, both of whom will stay on at Salesfusion, enhance the company’s business and technical capabilities and attractiveness to customers and investors. Said Christian Nahas, CEO of Salesfusion, “Marketers are asking for a solution that is smart and intuitive. A solution that helps them reduce the friction between marketing and sales and deliver bottom line results like never before. We are now one step closer to achieving that goal.” See more here. 

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Marketing Growth Strategies LLC has been engaged in research, analysis, lead generation, and client implementation in the Marketing Automation sector since 2009 and has recently revised its highly successful 2014 Marketing Automation eBook.

Are you a marketing automation vendor? Learn about the capturing up to 500 fresh Marketing Automation leads.

Considering implementing marketing automation? Download the 2014 Marketing Automation eBook.