Salesforce.com lost its fight to trademark 'social enterprise' - and Marketo CEO Fernandez reveals that the Cloud giant could also have found itself in a scrap over the term 'Marketing Cloud'.
Next week, all eyes will be on the Marketing Cloud – the Salesforce.com version. As previewed recently by Salesforce.com CEO Marc Benioff, the firm’s pitch to the CMO will be one of the main themes at the Dreamforce conference in San Francisco.
One firm that won’t be using the term at Dreamforce though will be Marketo, one of the main sponsors of the conference and a firm that’s been using the Marketing Cloud term for a good few years now.
Last time I met up with Marketo CEO Phil Fernandez he joked that if Benioff wanted to use the term it would cost him – and it does seem to have come close to that. This week in London Fernandez admits that lawyers have been consulted about who owned the term, but in the event Marketo has chosen not to make a fuss.
“You know, if you ask five lawyers for an opinion you end up with seven opinions,” he shrugs. "We had a board meeting and we asked ourselves if we wanted to pursue the Marketing Cloud brand equity. Our trademark lawyers thought Salesforce.com’s case was weak, but at no point did I really want to be in legal fight with one of my closest partners."
Given the events of recent weeks with Salesforce.com on the receiving end of criticisms for attempting to trademark the social enterprise term and its subsequent climbdown
, it's temping to wonder what would have happened if Marketo had decided to make a fight of it.
“We’ll never know," says Fernandez. "But buyers don’t really give a crap about any of that stuff. I had a couple of board members who beat me up on it, but I’m going to put our energy into stuff that really matters.”
In other words Marketo will carry on talking about the Marketing Cloud outside of the environs of Dreamforce, but this year instead of hosting its Marketing Cloud party at the conference, it will diplomatically stage the Marketing Masterpiece party instead. It's definitely a more civilised approach to terminology conflicts...
In the pit of the stomach
For what it's worth, the Benioff verison of Marketing Cloud will be somewhat different to the Fernandez version anyway reckons the Marketo boss. “At the heart of it, it’s about some of the new crowds that Salesforce.com wants to run with, that New York media crowd,” he suggests. “That’s clearly influenced some decisions, such as the acquisition of Buddy Media.”
That was a deal that surprised Fernandez he admits. “They have relatively few customers and lots of services activity, it’s not the high velocity, sell-a-lot kind of Salesforce.com model” he argues. “It’s surprising that they bought such a non-subscription model business.”
This may indicate deeper issues, suggests Fernandez. “I’m not sure that in the pit of his stomach that Marc believes in the space,” he says cautiously. “Some day it will be undeniable just how important this space is that we’re in, but until he has that wake up moment that this is a big category that every one of his sales force automation customers is going to need, well….”
Benioff has identified the CMO as a prime target however, citing a claim by research firm Gartner that the marketing officer will be a major influencer over ICT spend. Others have been more sceptical – last month Infor CEO Charles Phillips, for example, dismissed the notion
Fernandez holds a middle ground. “I think what’s really being said is that marketing is an under-invested area rather than that the budget will move to the CMO,” he suggests. “If you look at where the ICT investment has traditionally gone, it’s on finance and SFA and call centres. Overwhelmingly marketing has had the least investment.”
CMO responsibility - ready or not
This does beg the question of what CMOs will do with extra power and investment if given. In some respects the Cloud calls the bluff of CIOs who complain their ‘day job’ prevents them making a significant business contribution; the same might be said of the CMO presumably?
“The CMO says ‘The CEO doesn’t understand me’,” admits Fernandez. “There is a disparity of readiness among CMOs. There are those who get it, those who are in denial, those who are scared, those who are visionary – there’s no blanket answer. But we are seeing more and more hiring and replacement of people who are marketeers for a digital age.”
Fernandez was in London this week on one of the last stops in a 40 gig self-styled Social Rock Star tour around the world. With the final stage due to be held in Sydney in a few weeks time, he reflects that the agenda for these events has evolved as he’s encountered more and more customers and prospects.
“There has been a lot of interest in the social story,” he says. “It’s an appetite like a kid that says ‘daddy, daddy, daddy, tell me the story again’. I get out my slide about sales and marketing alignment that I’ve doing for what seems so long now that I think I should stop using it, but then I look out and see people paying attention and nodding around the room.”
It’s a familiar story – many of the long standing Cloud evangelists still say they need to start with Cloud 101 after ten years or more preaching the gospel. “Market waves always move ahead of buying waves,” agrees Fernandez. “But there is a lot of acceptance of Cloud Computing now.”
With that in mind, Fernandez sees no slowdown in opportunity for the Marketing Cloud – Marketo version. “Relative to our size as a company, the market is so huge that there’s a lot of buying going on,” he states. “It is true that in the US and Australia there are more deals that are at the end of the pipeline, whereas in Europe we do see less urgency in buying and more requests for another call to discuss. But it’s a growth market whichever way.”
One that’s big enough for Salesforce.com and Marketo? Undoubtedly so especially in light of their different approaches to the sector. Just don’t mention the Marketing Cloud at Dreamforce…