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Multi-Channel Testing & Personalization

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  • 1. TECHNOLOGY FOCUS. BROAD REACH. OPTIMAL RESULTS.Market Thoughts: Personalization in Digital MarketingSpring 2013Peter FalveyManaging Directorpeter.falvey@falveypartners.comP. 1.617.598.0437Jason MylerManaging Directorjason.myler@falveypartners.comP. 1.617.598.0438Jeffrey CookVice Presidentjeffrey.cook@falveypartners.comP. 1.617.598.0439
  • 2. 2Market OverviewMulti-channel personalization is among the top priorities for CMOs. Many solutionsvendors from diverse segments of the market are attempting to address the demand.Considerations Important Sector: Personalization is currently among the most critical objectives ofmarketers. Demand for personalization technologies is creating an increasingly attractivemarket and many companies are ramping revenues quickly Growing Number of Vendors Moving into Personalization: Vendors from several,diverse market segments are taking different approaches to deliver multi-channel, real-time personalization for marketers Significant Investment in Leading Vendors: A significant amount of venture capital hasrecently poured into the space as leaders try to take advantage of a rapidly growingmarket opportunity Consolidation on the Horizon: We believe larger players will begin to consolidate themarket in the next 12-18 months as they react to growing customer demand forpersonalization tools
  • 3. 3Personalization Becoming a BattlegroundThe value of marketing solutions is closely tied to the ability to personalize contentacross channels, attracting entrants from diverse market segmentsTESTING & ANALYTICS PROVIDERS- Testing and analytics tools increasingly moving intopersonalization as automation and more diverse testingCONTENT MANAGEMENT- Deep integration with existing enterprise systems- Would argue that they are best positioned as they hold the“pane of glass” between the user and channelE-COMMERCE INFRASTRUCTURE- Many e-commerce vendors moving from recommendationengines towards omni-channel personalization- Larger players releasing new products (e.g. Hybris)DIVERSIFIED ENTERPRISE SOFTWARE- Personalization initiatives leveraging investments inmarketing software and BigData / analyticsMulti-ChannelPersonalization
  • 4. 4Testing & Analytics Players are Well-Positioned to WinWe believe that the testing and analytics players will emerge as the leaders among thegrowing number of personalization technologiesSolution OfferingBasic EnterpriseScaleSmallerLargerTESTING & ANALYTICS MARKET MAP Personalization = Data: Personalization isbecoming an exercise in BigData, and testingand analytics platforms are already handlingthe core of the corporation’s marketing data End customer the same: Corporate users oftesting and analytics platforms are the sameconsumers driving growth of personalizationtechnologies Measurement is critical: Testing andanalytics vendors provide critical measuringtools to complement personalization Natural product extension: Effectivepersonalization automate and optimizes thehistorical testing processWHY TESTING & ANALYTICS PLAYERS WILL WIN
  • 5. 5Funding Landscape Among Leading Independent VendorsWe anticipate competition from vendors will ratchet in the coming months ascompanies deploy significant amounts of capital that has been raised recently$50M+$25M - $50M$10M - $25M<$10MUnfunded
  • 6. 6Targets and Offering MapMRM/Automation Social Web Analytics eCommerce WCM Sales CRM Online Testing E-mailin 2012 for $870M in 2012 for $300M in 2010 for $1B in 2011 in 2011 for $1.5Bin 2010 for $480M in 2010 for ~$600M in 2010 for $1.4Bin 2011 for $400M in 2009 for $1.8B in 2010 for $240Min 2012in 2013via Autonomy in 2011 for $11Bvia ExactTarget in 2012 for $689M via ExactTarget in 2013 for $2.2BAcquirerPlatform Players Will Start to Consolidate Personalization ToolsWe believe consolidation activity will be catalyzed by the larger marketing platformplayers as they continue to build their portfoliosNo offeringStrong offering Some offering
  • 7. 7Target Date Amount / Total Raised InvestorsApril 2013 $28M / $31.2M Benchmark Capital, Bain Ventures, Battery Ventures, Google VenturesFebruary 2013 $15M / $36M OpenView Venture Partners, Rose Tech VenturesFebruary 2013 $15M / $34M Bain Capital Ventures, TL CapitalFebruary 2013 $18M / $34M OpenView Venture Partners, Austin VenturesJanuary 2013 $60M / $79M Goldman Sachs, Arthur VenturesDecember 2012 $20M / $36M Northgate Capital, Trinity PartnersNovember 2012 $25M / $69M Mitsui Global, Orix VenturesNovember 2012 $20M / $39M New Enterprise Associates, Sequoia CapitalNovember 2012 $30M / $69M Investor Growth Capital, Tenaya Capital, North Bridge VenturesNovember 2012 $35M / $101M Altimeter Capital, Cross Creek Capital , Undisclosed InvestorsOctober 2012 $25M / $41M New Enterprise Associates, Lightspeed Venture Partners, Bain VenturesSeptember 2012 $16M / $31M Norwest Venture Partners, Trinity VenturesSeptember 2012 $20M / $35M General Catalyst Partners, FloodgateJune 2012 $39M / $67M Norwest Venture Partners, Nexus Venture PartnersJune 2012 $32M / $38M LLR PartnersJune 2012 $50M / $76M Northgate Capital, Summit PartnersMay 2012 $70M / $70M Accel Partners, Sequoia CapitalMay 2012 $26M / $47M Sequoia Capital, Hummer WinbladApril 2012 $33M / $80M New Enterprise Associates, DFJ, Walden InternationalsJanuary 2012 $12M / $14M Investor Growth Capital, Pentech VenturesRecent Investment ActivityHigh profile capital providers are showing interest in the broader marketing softwaresector through significant investmentSource: Company Press Releases, SEC Filings, Wall Street Research, CapitalIQ, Pitchbook
  • 8. 8Recent M&A ActivityThe consolidators are paying attractive prices for the emergent leaders in digitalmarketing to fill in product offering holesSource: Company Press Releases, SEC Filings, Wall Street Research, CapitalIQ, PitchbookTarget Acquirer Date EV Revenue / EVJun 2013 N/A N/AJun 2013 2,250M 7.1xJan 2013 N/A N/ADec 2012 N/A N/ADec 2012 $870M 9.7xOct 2012 $95.5M 8.7xOct 2012 $21M N/AJul 2012 $350M ~7.8x – 10xJul 2012 N/A N/AJun 2012 $745M ~14.9x – 18.6xMay 2012 $500M 10.0xMay 2012 $300M 3.0xFeb 2012 $169M 3.4x

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