vocus cloud marketing software analyst day presentation june 6 2012
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Vocus, Inc. Cloud Marke3ng So6ware Analyst Day Presenta-on June 6, 2012
Forward Looking Statements
During the course of this presenta3on, we may make projec3ons or other forward-‐looking statements regarding future events or the future financial performance of our company. We wish to cau3on you that such statements are just predic3ons and that actual events or results may differ materially. We refer you to our filings with the Securi3es and Exchange Commission, including our Quarterly Report on Form 10-‐Q for the quarter ended March 31, 2012, for a discussion of some of the risks and other factors that could cause our actual results to differ materially from those contained in our projec3ons or other forward-‐looking statements.
1:00-‐1:30 Vocus and Cloud Marke3ng Opportunity • Rick Rudman, Chairman and Chief Execu-ve Officer
1:30-‐2:00 Go To Market Strategy • Bill Wagner, EVP and Chief Opera-ng Officer
2:00-‐2:45 Product Overview • You Mon Tsang, SVP Product
2:45-‐3:00 Break 3:00-‐3:30 Customer Panel 3:30-‐4:00 Financial Overview
• Steve Vintz, EVP and Chief Financial Officer
4:00-‐ 4:30 Closing Comments and Q&A
Agenda
The Digital Marke3ng Revolu3on Rick Rudman, Chairman and Chief Execu-ve Officer
Unprecedented Change and Opportunity
S3mulus Shelf Experience
Tradi3onal Marke3ng Model
S3mulus Pre-‐Shopping Shelf Experience
New Marke3ng Model
New Consumer Buying Process
88% of US internet users will research
products online in 2012
New Consumer Buying Process
58% of online consumers have liked or followed a retailer
Old World Marke3ng in Decline
Yellow Page adver3sing has fallen by 50% since 2007
Old World Marke3ng in Decline
Since 2006 Newspaper Ad dollars have fallen 49%
70% of links users click in search results are organic not paid
New Digital Marke3ng Emerging
61% of U.S. marketers use social media to increase leads
New Digital Marke3ng Emerging
59% of marketers say email is s8ll best channel for driving revenue
New Digital Marke3ng Emerging
Rapid Growth in Digital Marke3ng
Digital marke8ng is expected to grow 17% CAGR from 2011 to 2016
$34b
$77b
Digital Marke3ng Defined
Email Social
Mobile
Search
Display
SMB Digital Marke3ng Spend 2012
Q: How do you plan to allocate your online marke8ng dollars in 2012?
17% 16% 15% 14% 12% 6% 5%
By 2016 70% of marke8ng budgets will be allocated to digital
SMB Growth in Digital Marke3ng Spend
20%
70%
2011 2016
Leading provider of cloud marke3ng so6ware that helps businesses
aeract, engage and retain customers
Vocus Today
Large and Growing Marke3ng Business
Vocus Marke3ng sales are expected to grow 34% in 2012 to $90M
$67M
$90M
2011 2012
Keys to Success
Innova3ve Product Integrated cloud marke-ng suite Social, Search, Email, Publicity
Broad Distribu3on E-‐commerce Large inside sales organiza-on
Unique Posi3oning SMB Sweet spot $3k-‐$30k 80% plus margins, renewals
. .
.
o Digital marke3ng represents one of the most significant opportuni3es in so6ware today
o Vocus so6ware suite uniquely addresses cri3cal func3ons of modern digital marke3ng
o Pricing and posi3oning creates scalable and profitable long-‐term business model
o Posi3oned for market leadership with one of the fastest growing cloud marke3ng businesses
Vocus Investment Highlights
Go To Market Strategy Bill Wagner, EVP and Chief Opera-ng Officer
Vocus Total Available Market
Large 1,000+
employees
Mid-‐sized
10-‐999 employees
Small
2-‐9 employees
Personal businesses 1 employee
1M orgs x $7K ASP = $7B
5M orgs x $3K ASP = $15B
Vocus TAM = $22B
Customer Acquisi3on Model
Mobile
Email Publicity
Social Media
Marke3ng eCommerce Sales Suite
o Free Trials provide high volume lead flow
o E-‐commerce sales reduce customer acquisi3on costs
o Inside sales upgrades to Vocus marke3ng suite
o Account Execu3ve team op3mizes renewals and upgrades
Free Trial
Website
SEO
Free Trial
Free Trial Free Trial
Free Trial
Free Trial
Vocus Sales Model
o 0-‐4 years experience
o $250K quota
o $75K compensa3on
New Sales
o 0-‐4 years experience
o $600K quota
o $70K compensa3on
Account Sales Large
Mid-‐sized
Small
Personal Businesses
Total Quota Carrying Sales Reps
-‐
100
200
300
400
500
2005 2006 2007 2008 2009 2010 2011 2012
Quota Carrying Reps
*
* Es3mated as of 12/31/2012
Customer Success Across All Industries
Healthcare Technology
Non-‐Profit Consumer
Customer Mix
Buyers
-‐ Small Business Owners -‐ Marke3ng Professionals -‐ PR Professionals
Customer Size
-‐ Small ( <$5M) -‐ Mid/Large ( >$5M)
Customer Mix
Geography
-‐ US -‐ EMEA
Channel
-‐ Field -‐ Inside -‐ eCommerce
Customer Mix
Product
-‐ SEO News Release -‐ Publicity -‐ Social Media -‐ Email
Packaging
-‐ Stand Alone Products -‐ Suite
Vocus Market Posi3oning
Marke8ng Suites o Mul3-‐channel o Integrated o $3k-‐$30k ASP
Enterprise Marke8ng PlaUorms o Complex lead scoring & CRM integra3on o Dedicated staff and services o $100k-‐$1M+ ASP
Point Solu8ons o Social, Email, Website o Freemium-‐$30/mo.
Large
Mid-‐sized
Small
Personal Businesses
Product Overview, Demo and Roadmap You Mon Tsang, SVP Product
Building The Modern SMB Marke3ng Suite
o All-‐in-‐one trumps point products
o Time to “WOW” measured in minutes
o Always Prescribe Ac8on
o “Signature” Features o Generate leads and
a[racts and retain customers
“It makes things a lot easier for me. The recommenda3ons are just fantas3c and they take the guesswork out of social media. It makes social media simple and much easier to grasp.”
“Comfortable and easy to go to...when in a rush it’s a nice place to be.”
Recommenda3on Engine Tes3monials
Page 1 of Google results for Boston rare coin dealer #3: PRWeb.com #4: PRWeb.com #5: Yahoo News (thru PRWeb) #6: beantowncoins.com
“We have risen to the first page on search engine rankings for most of our key terms in under 90 days.”
o Joe Palmieri, Beantown Coins
“The coverage we got was nothing short of incredible. I think gevng onto Forbes was my favorite.”
o Sco[ McIntosh, CEO, MusikPitch
PRWeb Tes3monials
o Added over 24,000 fans in 120 days a6er installing apps.
o Free so6ware product sample was downloaded over 30,000 3mes.
o Increased fanbase from 8,000 fans to over 20,000 fans in 4 months.
o Collec3ng over 6,000 email addresses of poten3al customers.
o Gained over 8,000 new fans in two months.
o 4,000 entrants into Sweepstakes campaign in 4 weeks.
Facebook Apps Customer Results
o Experts about spices o Ideas for luxury market column
o Owners of companies to chat about their 2012 hiring
Publicity Alerts From 2012-‐06-‐01
“Thanks to HARO, our sales have tripled. Our website traffic increased by 3,000% in one day alone, and its kept up.” “Three weeks a6er responding to the HARO query, I was on a plane to Florida, where I shot four na3onal television appearances. I did not expect that to happen.” “It was June when HARO got us into Beeer Homes and Gardens. I remember because we’d just released our new product, the S2H STEP. When our coverage appeared, the whole produc3on run sold out in two weeks.”
HARO Tes3monials
Vocus Mobile Start Page
Vocus Mobile Recommenda3ons
Vocus Mobile Twee3ng
Vocus Mobile Dashboard Metrics
iContact for Salesforce
Designed for Mid-‐Market Customers and Large Senders • Advisory Services • Web Site Tracking • Custom Reports • Advanced Segmenta3on • A/B Split Tes3ng
iContact Premier
“When we first started out, we would do snail mail and postcard mailers, which were very expensive…The value that we get from iContact really is huge for us.”
“iContact allows us to take client lists and data from a variety of different applica3ons and bring them into one place. We can create campaigns very quickly, test new ideas, and communicate with our customers. Being a small business, we don't have a large marke3ng staff, so iContact makes that very easy for us.” “There are a lot of email marke3ng solu3ons out there, but it's difficult to know which ones will be here tomorrow... If customer service and stability are your top priori3es, I wouldn't look anywhere other than iContact.”
iContact Tes3monials
Coming End of Year: o Fully Integrated Email o Social Business Stream o Buying Signals o Local Search Lis3ngs
Vocus Marke3ng 2.0
Buying Signals
Tele Atlas (TomTom) Comcast.net Search Dexknows.com Foursquare yellowbook.com Kudzu.com 7mainstreet.com Grote Sims realtor.com Acme Media Guide Me RepairPal anywho.com hamptonroads.com Reply.com apartmentguide.com Hello Hi Technologies SanDiego.com Atlanta New Homes Directory Hillclimb Media SimpleGeo Ausili Produc3ons HomeAndRoad.com Siri Inc. B2B Yellowpages Homestore Snapfinger.com beachcalifornia.com Hostway SnapMeals BestOfTheWebLocal ho{rog.com Swipely Boulevards New Media Innova Electronics TechnoCom BuyerZone Intellistrand Teleroute campusfood.com InTheMO.com Tello ChaCha Search Intuit TenList.com CheckPoints JHE Marke3ng thefeast.com Chevia justclicklocal.com thelocallife.com Ci3es2Night.com keen.com townme.com CityMaps.com kgb Townsquare Media CitySquares.com KSL.com TravelPost Closely License Holding Tribune Interac3ve Contractors.com Local Insight Media T-‐Tell CrowdSpot Localbase Tworkz.com DDC Locallife Holdings Upnext.com DirectoryCentral.com LymaBean usdirectory.com Dog3me Media MagicYellow V-‐Enable Driverside MarkMonitor.com V-‐Local Easily Planned Matchbin VoteForTheBest.com eats.com Matchpoint Walnut Industries Edmunds menshealth.com whatser.com Eyeroo Corp MerchantCircle Where Inc. ezlocal.com Metromix WhitePages.com EZToUse.com mojopages.com wimgo.com fixr.com MyCityWay.com wissr.com fixya.com mymove.com yellowassistance.com Foodspovng Ogden Newspapers yellowbot.com Friendfer.com OnSite Media yellowpagecity.com Fwix Openlist.com yellowspaces.com GenieKnows.com Outside.in yipit.com Geodelic Systems patch.com Yodle Georgia.com pennysaverusa.com Zebek ge{ave.com pilotonline.com zidster.com gofave.com praized.com zipcodez.com GoLocal247.com ReachLocal *as of Q1 2011 GoTown reallocalpages.com
Local Search Op3miza3on with Local Lis3ngs
o Social CRM o Web Pages o Mobile Marke3ng o Cross-‐channel Campaigns o Universal Designer
2013 Roadmap Highlights
Social CRM
Break We will return aXer a 15 minute break
Customer Panel
Amy S. Gebhardt Director of Public Rela3ons, Oneida
Steve Phillips President , Purple Trout Kathryn Seifert CEO, Eastern Shore Psychological Services Moderated by Bill Wagner, EVP and COO
Customer Panel
Financial Overview Steve Vintz, EVP and Chief Financial Officer
o Annual prepaid subscrip3on model and strong renewals create predictable revenue stream
o Monthly and transac3on eCommerce customers yields low CAC and drives upsell to annual subscrip3ons
o Investment in sales provides aerac3ve cash returns and long-‐term leverage
o Proven track record of balancing top-‐line growth with profitability
Financial Highlights
Consistent Revenue Growth
13 consecu-ve years of growth
Non-‐GAAP. *2012 at mid point of guidance provided on 5/1/2012 and reaffirmed today
$ Millions
-‐
20
40
60
80
100
120
140
160
180
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012*
Balanced Mix of Business
Revenue by subscrip8on type
Annual Monthly Transac3on
Customer count by subscrip8on type
Annual Monthly Transac3on
87
Record Customer Growth
Over 13,000 annual subscrip-on customers*
* As of 3/31/2012
-‐
2,000
4,000
6,000
8,000
10,000
12,000
14,000
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
2,000 acquired customers from DataPresse
E-‐Commerce (Monthly/Transac8on)
Annual Subscrip8on
ASP $480 $5,000
$$ Renewal Rate n/a 80%
Customer Life (years) n/a 5.0
Total Life8me Sales $960 $25,000
Marke3ng Acquisi3on Cost $300 $1,000
Sales Cost $0 $8,000
Total Life3me S&M Cost $300 $9,000
Total Life8me Contribu8on $660 $16,000
Life3me Profitability 69% 64%
Payback 3me (months) 7.5 8.4
Compelling Customer Economics
Investments Drive Strong Returns
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Cumulative Cash Cumulative Profit
Cash Break-‐ even
Profit Break-‐ even
Collec8on, revenue starts
First Sale
Hiring a Sales Rep is Accre8ve to Cash Flow in Year 1 and Profit in Year 2.
Significant Growth in Marke3ng
Marke3ng PR
Marke3ng represents over 47% of total sales for FY2012 Growth in marke3ng accelera3ng to 37% for 2H2012
0% 5% 10% 15% 20% 25% 30% 35% 40%
1H12 2H12
Q2’12 o Non-‐GAAP Revenue $43.5M -‐ $43.8M o GAAP Revenue $42.8M -‐ $43.1M o Non-‐GAAP EPS $0.08 -‐ $0.09 on 24.2M diluted shares o GAAP EPS $(0.30)-‐$(0.29) on 19.5M basic and diluted shares FY 2012 o Non-‐GAAP Revenue $171.3M -‐ $172.5M o GAAP Revenue $169.1M -‐ $170.3M o Non-‐GAAP EPS $0.38 -‐ $0.40 on 24.0M diluted shares o Free Cash Flow $15.5M -‐ $16.5M o GAAP EPS $(1.25)-‐$(1.23) on 19.5M basic and diluted shares
Reaffirming Q2’12 and FY2012 Guidance
Balance Sheet Highlights
Cash & Investments
Total Debt
Total Assets
2012
$25.8
2010
$100.4
Deferred Revenue
$ in Millions 2011
$108.2
$283.9 $174.5 $195.7
$1.8 $0.3 $1.0
$66.4 $56.6 $63.0
Shareholders’ Equity $102.4 $104.4 $102.7
December 31 March 31
92
Long-‐Term Financial Model
(2%)
Revenue
Opera8ng Margin
G&A
R&D
S&M
Gross Margin
2012*
78%
$28.1
53%
9%
18%
Free Cash Flow ($2M)
$ in Millions 2005
6%
83%
$171.9
54%
6%
17%
$16M
25-‐30%
Long-‐Term Op Model
85-‐87%
100%
41-‐42%
5-‐7%
10-‐12%
25-‐30%
All data-‐points referenced above are on a Non-‐GAAP basis. *2012 at mid point of guidance provided on 5/1/2012 and reaffirmed today.
18%
83%
$84.6
44%
4%
17%
$20M
2009
o Expand cloud marke3ng suite o Grow inside direct sales force o Expand e-‐commerce and alternate channels o Expand interna3onal opera3ons o Selec3ve opportunis3c acquisi3ons
Long-‐Term Growth Levers
Concluding Remarks and Q&A
o Digital marke3ng represents one of the most significant opportuni3es in so6ware today
o Vocus so6ware suite uniquely addresses cri3cal func3ons of modern digital marke3ng
o Pricing and posi3oning creates scalable and profitable long-‐term business model
o Posi3oned for market leadership with one of the fastest growing cloud marke3ng businesses
Vocus Investment Highlights
Vocus, Inc. Cloud Marke3ng So6ware Analyst Day Presenta-on June 6, 2012
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