Enterprise software 2014: Three themes to ponder

Enterprise software 2014: Three themes to ponder

Summary: Data as an asset, expanding consumption of enterprise automation to smaller companies and marketing automation are three themes worth watching, according to Cowen & Co.

SHARE:

Are there many new frontiers in enterprise software? Maybe not, but three themes are emerging for 2014 and one of them could lead to lead to more automation and enterprise software consumption across every business.

That's one of the arguments from Cowen & Co. analyst Peter Goldmacher who sees converting non-consumption of cloud software as a big growth market. Goldmacher explained in a recent research note:

There are very few greenfield opportunities in Enterprise Software any more. While there are a number of vibrant, high-growth SaaS companies, the vast majority of them are selling replacement products. We believe there is an enormous secular growth opportunity in automating processes at the very low end of the market. The Cloud has ushered in a new era of software where, for less than $50 a month in most instances, the smallest of small businesses can get enterprise-class software to automate core functions like Finance and Sales & Marketing.

In other words, large companies are swapping on-premise software categories for cloud replacements. However, smaller companies are still out of the fray and haven't benefited from process automation as much.

Add it up and the enterprise software market could expand if it can move toward the low end. Here's the rub: Most cloud companies started by focusing on smaller companies---think Salesforce and NetSuite---but are now clearly focused on large enterprises.

Goldmacher's two other trends are worth noting.

  • Data as an asset is a theme that will also affect enterprise software. Mining data will be used to convert sales, cut churn and cross sell better. Those goals represent lower hanging fruit, the bigger game is combining first and third party data to offer new products, better understand customers and drive sales.
  • Marketing automation---the last corporate function lacking process automation---will increasingly base pitches on real preferences over demographic targeting.
adobemarketingcloud

The tech companies aimed to capitalize on these trends aren't the big names you'd expect. Adobe will is a data and marketing automation juggernaut even as larger rivals talk a better game. Adobe's marketing platform trumps the point products from Oracle, Teradata, IBM and Salesforce, according to Goldmacher. 

Intuit will increasingly bring automation to smaller companies and use data as an asset since it has been chasing big data plans across its users for three years. Endurance International sells domain names, hosts Web sites and can monitor data sets from its customers for cross selling and marketing. Constant Contact is another company that can be a key marketing automation player despite previous execution issues in 2012.

Topics: Enterprise Software, Big Data, CXO

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

1 comment
Log in or register to join the discussion
  • It is a new era alright...

    "The Cloud has ushered in a new era of software where, for less than $50 a month in most instances, the smallest of small businesses can get enterprise-class software..."

    Yes, and pay that $50 per month forever. Instead of buying the software once and using it as long as you can. And not worrying about Internet down time, hackers, vendor lock-in, etc.

    Doc
    Doc.Savage