What’s new at Marketo?
We had a great 2014. We grew revenues by 56% and we now have 3,724 customers. We’ve also done a great job with customer satisfaction, with a 109% retention rate (as measured by dollars). When we generate more revenue from our customer base, that means that they are generating more revenue as a result of using Marketo, so that’s a very good thing.
We also launched a major thought leadership agenda – the Era of Engagement Marketing. The focus is on mastery of digital marketing and helping marketers shift from mass marketing to engagement marketing, or — in other words — helping them talk to their audiences not as a whole, but as individuals with specific needs and interests. This helps marketers build lasting relationships with their customers, which is especially important in today’s world where buyers have lots of choices and can move to a competitor’s product or service at a moment’s notice.
We’ve got some great examples where we are enabling marketers to move from mass marketing to engagement marketing, such as how we are helping Microsoft build subscription revenue for Office 365 or helping Pfizer map their marketing to their customers’ journeys. Dropcam is using Marketo to build stronger relationships with their customers. And we’re not just working with huge brands. We’re working with fast-growing companies like Zenefits, Forbes Magazine’s Hottest Startup of 2014, as well as nonprofits like Save the Children and the Juvenile Diabetes Research Foundation.
We also released a calendar product – the first component of our Marketing Resource Management offering. It’s a special product in that it’s the only marketing calendar that unifies campaign execution with planning. In other words, instead of just displaying a campaign, marketers can create their campaigns directly in the calendar. They can even change the timing of a campaign — like an email — simply by dragging and dropping to another day. It’s an innovative product that our customers love.
Our product innovation has centered on how to help companies engage prospects and customers across different stages of the customer journey. In some cases that has involved integration to third-party platforms like Hybris for e-commerce and Facebook for advertising. Expect to see us continue to build partnerships and integrations like these, which help users of our Engagement Marketing Platform communicate with prospects and customers based on who they are and their preferred channel. Not every customer, myself included, wants to engage across every channel. You need to understand my preferences, or I’ll tune you out.
It seems like a lot of innovation is oriented towards the top of the funnel?
Yes and no. With 60-90% of customers self-directing their journeys and the majority of people at the top of the funnel being anonymous, the challenge for every marketer is how to create an engaging experience for both known and unknown customers/prospects. Many of the innovations we’ve delivered have been targeted at helping marketers do just that.
For example, the Customer Engagement engine is a very innovative capability that made sophisticated lead nurturing simple, and that’s obviously aimed at the middle of the funnel. We have some interesting enhancements that you’ll see in the next few months that are focused at the middle and bottom of the funnel. But yes, the most recent innovations have been aimed at the top mainly – our SEO functionality and our Real-Time Personalization product.
Can you provide an update on the integration of Insightera?
It has been seamlessly integrated. It is not on its own island. It looks and feels and works like a seamless part of the Engagement Marketing Platform, because it is. When Marketo integrates new technology, we don’t want an integration where data is simply being exchanged on the backend. We demand better, because we know our customers will as well.
It’s available for purchase as a value-added capability and is now called Marketo Real-Time Personalization. The key value proposition is driving a real-time personalized web experience for both known and unknown site visitors, based not only on who they are (demographics, firmographics) but also what they do (behavior). And it enables this even for completely anonymous visitors, which is the largest population of visitors to most corporate websites. Web behavioral data can also be leveraged across other channels, like creating a more personalized email experience.
It enables an integrated, connected experience across interactions and channels. That is a major differentiator. One interesting use case is in automobiles. If you begin to configure a car online but don’t complete it, it can trigger a personalized email or alert to the salesperson. Or if it is completed, the system could recommend that the person come into the brick-and-mortar and take that model for a test drive.
Can you talk more about the Facebook integration you just announced?
As we discussed, our strategy is to help companies engage customers wherever they are, and a lot of them are hanging out in social channels. We can target known and unknown people with relevant information using Marketo and Facebook. Marketo offers marketers the ability to build rich database segmentations, many of which are built using behavioral data.
These segmentations built in Marketo can now be used to target individuals with specific Facebook ads. For example, a known traveler is browsing for hotel deals on a travel site and leaves without making a purchase. In addition to being sent relevant information about her destination in other channels such as email, when she visits Facebook on her smartphone, she can also be directly presented with ads from the travel site, which encourage her to go back to the site to complete her purchase.
What’s the difference with traditional Facebook re-targeting?
It takes advantage of all the rich segmentation a marketer builds in Marketo in order to make these ads more relevant. Facebook offers targeting capabilities but this can be enhanced with Marketo. Now the ads can be personalized based upon a person’s behaviors across other channels, such as the web or email, or based on other known demographics or firmographic that wouldn’t otherwise be accessible through Facebook’s ad targeting engine.
Are the ads dynamically rendered for the individual?
Yes, the ads are generated dynamically based upon the segment profile.
Does the Facebook integration require Marketo Real-Time Personalization?
No. The Facebook integration is available to all Marketo customers and does not require the Real-Time Personalization product.
Can you talk more about your recently announced integration with SAP Hybris?
SAP announced a partnership with Marketo to empower brands to unify customer information and build long-term relationships with them. Hybris (an e-commerce platform) stores customer data across touch points – service, sales, commerce, supply chain orders, billing, etc. Marketo helps companies to leverage this data to better orchestrate campaigns to engage customers at every step of the customer journey. For example, if an aircraft manufacturer uses Hybris to capture data on things like parts orders and repairs, they can use Marketo to market to their large airline customers. This could include things like triggered messages around part re-orders, targeted promotions, etc. The value here is that the understanding of customers is expanded to include a wider set of enterprise data and engage them more effectively.
Marketing Resource Management (MRM) was a big theme when I last talked to Jon Miller (co-founder, Marketo). Can you provide an update?
Marketing is a team sport. A big challenge that a lot of our customers have is, how do I coordinate a set of activities across teams and divisions in such a way that I don’t over communicate? Since Calendar’s launch last September adoption has been strong. You will continue to see more innovation that provides the ability to plan and execute in one place, making it easy for cross-functional teams to coordinate on campaigns. The idea for Calendar was sourced by our user community.
As you do more in MRM, will you start to compete with your partner, Allocadia?
No. Allocadia continues to focus on financial budgeting. Our MRM function is focused on planning.
A concern which surfaces in your reviews is reporting if you don’t purchase the Advanced Analytics module. Do you have any plans to address this?
Yes, we are addressing it. There are now 20 reports available outside of the Advanced Analytics module. You’ll see us to continue to improve the out-of-the-box reports, as well as to build on differentiation available through our Advanced Analytics – such as revenue attribution measurement – where you can track the revenue and pipeline influence of every customer interaction at every step of the journey.
I do want to add that some of this feedback is a bit misaligned, as our standard reports are more flexible and more customizable than those of our primary SMB competitors. So it isn’t that you need to purchase the Advanced Analytics in order to get reporting that is the equivalent of our competitors. Rather, we believe that our standard reporting is a step above those of our competitors, and purchasing the Advanced Analytics package provides capabilities that our competitors simply don’t offer. So it isn’t really an apples to apples comparison.
I know that B2C is a big growth focus. Can you talk about your progress?
We’ve seen tremendous growth in B2C. It has become deeply embedded in the profile of our customer base in our new customer acquisition results. We’ve signed a range of companies that needed a better way to engage to their customers; from automakers to app makers, from higher education to home decoration. MyFitnessPal, for example, is a very fast-growing small business that was recently acquired by Under Armour. There are 65 million people using the MyFitnessPal app to count calories, manage their diet and track their fitness. MyFitnesssPal is using Marketo across their email, website and blog to reactivate customers and move them forward in their fitness journey. They are practicing continuous nurturing in order to build stronger relationships with these users. Also, we’ve have large companies like Kaiser Permanente using Marketo for B2B and B2C. The Affordable Care Act has increased the importance of building relationships with individuals.