In the four years since its founding, ExactTarget which delivers e-mail marketing solutions has landed more than 3,250 clients, including General Mills and Home Depot. And the 140-employee company plans to hire up to 10 more people a month for the next several months, says Dorsey, ExactTarget’s president.
“The biggest risk or challenge I see ahead for us is integrating so many new employees into the business,” he says. “We need to convey who we are and communicate our core values.”
Dorsey, who founded the company with Chris Baggot and Peter McCormick, attributes the company’s success to its adherence to its eight core values Treat people well. Be easy to do business with. Stay true to permission. Make clients look like heroes. Empower marketers through software. Make decisions like an owner. Have an entrepreneurial spirit. Pursue company goals as a team.
To instill those values, ExactTarget requires each new employee to attend three days of training.
“What I am hoping to instill in them is that when they are making decisions, to hold them up against the core values,” Dorsey says. “If they do, they’ll make the right choices.”
Smart Business spoke with Dorsey about the company’s frenetic growth, its strategies for success and its core values.
What strategies led to the company’s growth?
We developed powerful and easy-to-use software designed to empower the marketer. Companies before us built their models around advertising agencies or companies that offer or perform professional services on behalf of a client. Our first big strategy was to put the tools and the power directly in the hands of the marketer at the companies themselves.
Secondly, we focused on tools that were interactive and appealing to Internet agencies. We have a strong reseller network that offers our tools through their own private labels and resell. They can then include e-mail marketing in other Internet or marketing services that they offer. That represents about one-fourth of our business.
Another strategy is that our sales and marketing employees are building face-to-face relationships with their clients. We are not leaning on the Web to sell the Web. We have local people in several markets, which is very different than other companies. We have reps in 30 cities. Some of these markets are untapped by other companies and have proven quite successful for us.
We have also partnered with some firms that have customer data and worked with them to develop smarter, more relevant software. We integrated our products and developed two applications.
We’re a client, as well. We help clients leverage customer data, like his buying history, city, state and ZIP code. We pull that information into an application so marketers can send more targeted e-mails. That’s the cornerstone of the business and what we’ve been doing from Day One.
We’ve been very focused on empowering the marketer. Leveraging the agency and partnership channels were opportunities that presented themselves,
and we took advantage of them.
What strategies were unsuccessful, and what did you do about them?
There are always strategies that don’t work as you intended. Early on, we focused on small businesses and franchise organizations to build content. We thought the franchises could localize the software to the marketplace and we’d have a good segment of the market.
We had a product category called Franchise Connect. It was not as successful as we thought it would be; there were bigger opportunities with companies that had large sales organizations or business units around the country and globe. Companies could do branding and content development at the field level and localize it.
We abandoned Franchise Connect and translated it into an enterprise platform with the same functionality, with great outcomes. It would not have been as successful under the franchise banner.
When did you know the company was going to be successful?
We’ve been insatiable. We rarely sat back or have been satisfied with where we were. The turning point was when we gained momentum. It started about two years into our evolution.
We were landing bigger clients and realized our products worked well for large organizations. We felt then that we were becoming a strong player, growing a lot and gaining a lot of momentum.
You added 250 clients in the last quarter. How are you accommodating that increase in business?
We just recently moved to our new corporate headquarters in the heart of the city on Monument Circle. We have 30,000 square feet of space now. We also made tremendous investments in hardware and personnel.
We have been very aggressively hiring. Our goal is to hire five to 10 new employees a month.
We’ve hired a recruiter who can devote 100 percent of his time to hiring. We are seeking high-energy people that have a passion for the business and have an entrepreneurial spirit, who think like an owner of the company. Those are intangibles. And we need people who thrive in a high-growth environment.
As the company reaches a more mature stage in its development, do you expect your rapid growth to continue?
We really don’t anticipate our growth to slow we are moving at a pretty fast clip and feel that growth will continue. The strong reason is our on-demand software, which is a big base of our business.
Clients pay us each year or monthly for the software, and this model is working throughout the whole nation. The client leases the use of the software for one year and renews at a comparable rate or more.
We have a strong rate of reoccurring clients. We are doing a great job bringing new business on board plus adding more services to our current clients.
The majority of our competitors are privately held. We are highly regarded by analysts and are considered one of the top three companies in the country. We have more than 3,250 clients under contract. Most companies only cater to high-end clients, so they only have 200 or 250 clients.
How do you plan to retain and attract clients?
On the retention side, we’ve built a capable account management team that helps the clients use the applications correctly, building client relationships and offering great customer service. They make sure the
client is well cared for and successful.
On the new business side, we have a partnership strategy which has proven highly valuable in generating new leads. We also offer ongoing education in the form of seminars and Webinars that are very successful ways to attract new clients.
How have your core values played in your strategies and growth?
One of our core values really stands out to me that has impacted the business, and that is to stay true to permission. It became very clear to me that that philosophy was important.
Our clients have legitimate use of e-mail addresses but need to use them responsibly. We developed a one-year anti-spam agreement for our clients. We turned away a lot of business because of that agreement, because a lot of businesses don’t care about privacy or being responsible e-mail marketers. We stayed away from the temptation of sharing our databases.
Our core values remain very strong, and our other values focus on privacy and deliverability. Because of our core values, we have very good relationships with providers like AOL which have very strict standards. A second core value that is important to us is for us to be easy to do business with.
It’s easy for a nontechnical person to understand the software and our price structure. And we have a strong customer service orientation. It’s easy to get ahold of us, and we put our service up against that core value filter.
Are there any plans to take the company public?
Our core focus is to build a great business and grow in size and presence. While taking the company public is an option for us, we don’t have plans at this time. Last year we felt that we became a high-profile, on-demand software company.
Our business is fundamentally run like a public company; we use metrics similar to a public company, so that could be an alternative for us in 2006 or 2007.
HOW TO REACH: ExactTarget, (317) 423-3928 or www.exacttarget.com