Smart SaaS

Did you start out as a Software-as-a-Service company?

We definitely started out as a SaaS company after myself, Phil Fernandez our President and CEO as well as David Morandi our CTO, emerged from our experience at Epiphany.

Our collective vision for marketing automation was to remove as many barriers to product adoption as possible. The market is littered with failed marketing software companies, especially on-premise firms. We wanted to build a world-class marketing automation solution that was easy-to-buy, easy-to-own and easy-to-use for all types of front office functions.

We knew that it was almost impossible to get big capital budget dollars for marketing automation systems, in fact, the marketing department was usually the last in line to get any money, but they did have large discretionary operating budgets. Our customers needed to have a marketing service that you can stand up quickly and show rapid value because marketing executives can’t afford to hire people to make the system work, they had to push a button and then run their first campaign.

Why do your customers buy from Marketo?

Marketo’s target customers are mid-market and enterprise divisions of large business-to-business companies. In the last two years we have sold to more than 500 customers. Marketo is serious enterprise software and not just a pretty user interface. In fact, 25% of all our customers are enterprises, not just small or medium businesses.

Over the last ten years customers have purchased complex marketing products that were dependent on buying from sales and then getting installed and trained by consultants. The current expectations have changed about marketing software and marketing and sales executives now want immediate access to all the information related to their customers and prospects. Many sales and marketing processes have not changed but there is clearly a new buying process that many companies are following. Marketo helps our customers align their selling processes to these new buying processes.

For example, today’s demand generation best practices now requires a much wider funnel of potential buyers, behavior-based lead scoring, lead nurturing, with analytical tools that can save precious time and deliver better qualified leads. With this focus on efficiency, it is now possible to unlock the value of our customer’s existing lead databases and their sales teams can close more business.

With Marketo, customers can map out their own unique buying process, team selling approach, define multiple touche campaigns and make marketing and sales much more of a science than an art. We re-imagined how the marketing professional could map out their campaigns, without having to use Visio, because the process would be more conversational, even object-oriented.  Marketo campaigns are listening to various sales and lead processes and then have agents kickoff automated actions. This makes our products easier to learn and our customer’s marketing campaigns more relevant and efficient.

We also offer smart integration with Salesforce.com is a huge advantage for us. For example, a customer can add a new schema objects in Salesforce and Marketo will make the update automatically. Marketo has developed our API natively for Salesforce but we can also work with other CRM systems like NetSuite, Siebel and Microsoft Dynamics.

Our products include Marketo lead management, which is marketing-focused and Marketo Sales Insight is sales-focused and is built on top of Salesforce.com’s Force.com platform.

A newer capability of ours is around social networking, where we can provide real understanding about what our customer’s prospects are doing on-line, like the pages they have visited, search terms they are using, but we can also help to understand what prospects are doing off-line, because that is equally as important. Marketo has integrated into Twitter and now customers can track activity, and follow-up with prospects using traditional methods like email or the phone, and in the future they can even send direct messages back through Twitter.

What do you see as the key trend emerging in the SaaS industry?

We think the Marketing Cloud initiative is a something really interesting. Salesforce has left some white space around marketing because it is such a diverse functional universe and Marketo has worked to put together an alliance of complimentary marketing technologies.

The Marketing Cloud partnership includes Demandbase, Jigsaw (which was just purchased by Salesforce.com), PR Newswire, Jive Software, Clickability and Conductor. There are ten SaaS companies in our alliance, which is the vision of the future marketing integration.

For example, a customer can do a search with Google which is optimized by Conductor;

· Then you see an add you like and click on it and then you land on a Marketo landing page,

· Then Demandbase knows the prospect’s industry,

· Clickability helps target a specific industry and then promotes a webinar,

· ON24 manages the webinar, sends reminders attend, and

· then you close the loop using PivotLink analytics.

Over time we will be able to support more and more composite marketing processes.

What is your outlook for 2010?

During 2009, most SaaS firms did well, but we did really well because our solutions are easy-to-buy. Our 2010 is on fire! We are on track to be on par with leading SaaS firms like Omniture, NetSuite, and Taleo’s and their growth numbers. The SaaS market continues to explode and we just need to continue to execute to be successful.