Software for matching medium and message

June 16, 2014, 6:27 PM UTC
NewsCred's Content Marketing Cloud software.
Photo courtesy NewsCred

It’s one thing to control branding in a single advertisement or corporate brochure. It’s another thing entirely to coordinate dozens of stories and messages across multiple digital marketing channels, from social media to websites to text messages.

Then do it every day. (Actually, more like every hour.)

That challenge is what is driving the emergence of content marketing software, a category all but invisible until October 2013. That’s when Oracle (ORCL) paid an undisclosed sum to buy Compendium, which develops technology that helps marketers deliver relevant content to prospects using profiling and analytics.

“As customers increasingly access information through online and mobile channels, the buying process is shifting from sales-driven to marketing-driven,” said Thomas Kurian, executive vice president for Oracle’s Development group, when the deal was announced. “Now, more than ever, marketers are challenged to deliver relevant and engaging content across multiple channels and throughout the customer lifecycle.”

In the eight months since that deal, millions of dollars in venture capital have been pledged to startups in this space including $25 million for NewsCred, $24 million for Percolate, $9 million for Contently, and (earlier this month) $3.6 million for Triblio. And last week, one of the older companies in the category, Kontera, was bought by digital advertising agency Amobee for $150 million.

“One of the big trends in marketing over the last three years has been the shift from discreet campaigns to sustained communications,” said Michael Dixon, a partner at Sequoia Capital who joined Percolate’s board as part of its March funding round. “This new pattern of communications has placed additional resource demands on marketing teams and requires deeper coordination between marketing, communications, IT and outside partners like agencies. These challenges aren’t solved just by adding more people or money. The only scalable way to handle these demands is through implementing a content marketing system.”

Why is this category so suddenly interesting? Forrester Research senior analyst Ryan Skinner said at the most basic level, content marketing tools replace spreadsheets as a means of tracking and coordinating simultaneous writing or content development projects. But the promise is far grander: helping marketers stay more “culturally informed” about which messages might resonate with their target audiences. “Every marketer is trying to become a quasi newshound,” Skinner said. “These tools help give them relevance.”

There are actually a mind-boggling array of startups that claim to focus on different pieces of this problem, which makes it very difficult to compare the prospects of a Percolate, which focuses on workflows, with other high-profile players such as Kontera, which is focused on analytics.

One high-profile Percolate customer is consumer goods giant Unilever (ADR), which uses the software to coordinate messages and content related to more than 60 different brands across dozens of markets. “We are trying to build software around the entire workflow of marketing,” said James Gross, Percolate’s co-founder.

Given their niche status, many of these developers are busily building connections with other tools and platforms that relate to sales and marketing. Kapost, for example, has so far created more than 50 integrations with tools ranging from Eloqua (part of Oracle) to LinkedIn to Marketo to Salesforce (CRM) to WordPress. Pricing starts around $1,000 per month for up to 10 users, said Jesse Noyes, Kapost’s senior director of content marketing.

“In different channels, customers will be in different stage of decision-making. You need content to reach the buyer at every stage,” Noyes said. “The thing you will always need is content.”

In its May report analyzing the category (“The Content Marketing Software Landscape: Marketer Needs & Vendor Solutions”) the market research firm Altimeter Group organizes content marketing companies in eight different use cases: Creation, Curation, Aggregation, Optimization, Performance/Analytics, Audience Targeting, Distribution, and Workflow. “People are absolutely spending money on this. Venture funding is through the roof,” said the report’s author, Rebecca Lieb. “It is exploding and will continue to exploded.”

Over the next several years, Lieb believes natural maturation will inspire the creation of “content marketing stacks” that combine these capabilities and make them simpler to manage. These are akin to the services that have converged around digital marketing and advertising tools, perhaps best illustrated by Google’s acquisition of DoubleClick back in 2007.

Three players to watch on that front (for now) are Oracle, and Adobe (ADBE), all of which are investing in different components of these technologies. It will take a couple of years to get there. “Adobe has all the ingredients, but it doesn’t mean they have the cake,” Lieb said. “Integration is hard.”

Meanwhile, and Oracle are hungry, and wealthy. So stay tuned for more consolidation and integration in this software category.