Constant Contact makes sure businesses never lose touch with their prospects and customers. The company provides small businesses with Web-based marketing software and services for managing e-mail and social media campaigns, as well as offering local deals, managing digital storefronts, and creating online surveys. Its offerings include tools for creating, implementing, tracking, managing, and analyzing marketing materials. Customers include retailers, restaurants, and other businesses, as well as non-profit organizations, alumni associations, and churches; two-thirds of its clients have fewer than 10 employees. It claims more than 555,000 customers for its products.
Constant Contact has offices in Massachusetts, Colorado, Florida, California, and New York, as well as in London. It serves clients in some 180 countries, although the US accounts for nearly 90% of sales.
Sales and Marketing
Of course Constant Contact uses digital marketing techniques to attract customers. Its products are marketed through its own advertising and referral efforts, as well as through partnerships with more than 9,500 local and national small business service providers.
It focuses on small businesses and organizations, most of which pay a fixed, monthly subscription fee based on the number of e-mail addresses in their account. Subscriptions to its e-mail marketing tools typically cost between $15-$150 per month, which allows Constant Contact to serve a market that is typically ignored by larger CRM and marketing software competitors such as Oracle, SAP, and salesforce.com. The company has seen rapid organic growth in recent years, with its customer base growing 20-fold from the 25,000 it reported in 2004.
Constant Contact's revenue has risen steadily along with its customer base. In 2012 sales were up 18% to $252 million, driven by a 12% increase in the number of average monthly customers and a 5% rise in revenue per customer. Now in its third year of profitability, the company took in $12.7 million in net income for 2012, down 46% from $23 million in 2011. The decrease in profits was due to increases in operating expenses, as well as costs for acquisitions the company has made.
The company continues to enhance its offerings with new services and tools, and throughout 2012 it expanded its product suite from three products to six. CardStar provides mobile applications for loyalty cards and coupons. SaveLocal manages group coupons for small businesses, and SinglePlatform offers a digital storefront for mobile formats. Previous product launches include online surveys (2007), event marketing (2009), and social media (2010) tools.
It is also looking for growth in new geographic markets. Although international operations are a small part of Constant Contact's business today, it sees opportunity in international markets. Its email marketing templates are also offered in Spanish, and the company opened its first office outside the US, in the UK, in 2011.
Mergers and Acquisitions
In 2012 Constant Contact paid $5.7 million for CardStar, which provides mobile applications for loyalty cards and coupons. Also that year the company acquired SinglePlatform, a developer of marketing software used by small businesses to improve their visibility to consumers on the Web. SinglePlatform's application enables businesses to use a single interface to distribute content to such online venues as Foursquare, YP, and UrbanSpoon, as well as on social networks and other websites.
In 2011 Constant Contact had added social CRM capabilities with the acquisition of Bantam Networks for $15 million in cash. Its Bantam Live application gives small businesses a place to launch and monitor customer engagement campaigns across social media platforms. In 2010 the company acquired NutshellMail, giving its customers a tool for engaging social media networks from their e-mail inbox.