Competition hots up in marketing automation as Marketo eyes number one position
I had a short update meeting yesterday with Phil Fernandez, founder and CEO of marketing automation vendor Marketo, who was in London for that vendor’s...
I had a short update meeting yesterday with Phil Fernandez, founder and CEO of marketing automation vendor Marketo, who was in London for that vendor’s annual client and prospect events (which was bigger and better than ever, so he claims).
As last time we met, in November 2011, Fernandez's manner relaxed and easy going, which belies his status as leader of one of the world’s fastest growing technology companies. Marketo reported 200 per cent year-on-year income growth in August which he says means it is now neck-and-neck with category founder and long-time leader Eloqua in vying for market supremacy, according to the latest market data.
But rather than dwell on corporate rivalry, I was keen to understand his view of the market as a whole, and in particular the extent to which it is growing, and the opportunities that presents. Given that whilst marketing automation has been around for the best part of a decade now (and is therefore now longer a ‘new’ technology) but its market penetration remains low, is he disappointed by how his company is performing? When there’s so much potential business still out there, could they being doing better?
Not a bit of it, was his response. “We’re growing as fast as we could realistically expect to,” he said, as evidenced by ongoing recruitment drive which has increased headcount 100 per cent year-on-year. Whilst he certainly was not prepared to accept that Marketo’s growth was ‘seat of its pants’ stuff, he was quick to make it clear that the growth at the level he is managing presents significant challenges. Whilst Fernandez may be laid back on the surface, lack of ambition or determination on the part of the CEO is certainly not going to be holding Marketo back.
As for recent developments, Fernandez was delighted to inform me that he has not spent a penny of the $50 million in VC investment that he secured last autumn, and strongly hinted that acquisitions are likely to be a key source for future growth. This follows the purchase of Facebook specialists Cloud Factory, acquired back in April.
He also repeated his suggestion to me from last autumn that creating MRM (Marketing Resource Management) type functionality within its platform was a key ambition for Marketo, making it the key marketing management platform, and a must-have for the CMO. He would not, however, be drawn on timelines for the launch of such functionality.
The key challenge for marketing automation vendors, he says, remains to address the fragmentation of technology in the marketing space, which results in disparate, often incompatible suites of applications making integrated thinking and analysis difficult if not impossible. Building a platform to achieve this, either by internal development or acquisition, is Marketo’s challenge, and a grand ambition. This is a company that has come a long way from often being regarded as an upstart in the marketing automation space just four years ago, to a potential leadership position. It would take a brave man to bet against them achieving their objective.