MBA Class talk on SaaS and Martech impact to modern pricing. UC Berkeley, Haas Business School April 2016

1. Intuit Confidential and Proprietary1
SaaS and Marketing Technology:
Impact to Modern Pricing
Spring 2016
• SaaS and Martech Pricing Considerations
• Case Study: Intuit’s Martech “BluePrint” and Tech Purchasing

2. What is SaaS and Martech?

3. Brief History: Computer Science Innovation that drove the SaaS Model
Baby Boomers
(Born 1946 – 1964)
Generation X
(Born 1965 – 1981)
Millennial
(Born 1982 – 1996)
Generation Z
(Born 1997 - Present)
1961
IBM 1301
Disk
Storage
Unit is
released.
1962
Atlas
Computer
emerges
with virtual
memory
1970
Computer-
to-computer
communicati
on expanded
when the
Department
of Defense
established
four nodes
on the
ARPANET
1978
Wang
Laboratorie
s to
produce a
disk drive
small
enough to
use with a
desktop
computer
1994
The Iomega
Zip Disk is
released. T
he initial
Zip system
with later
versions
increased
the
capacity to
2GB
1990
The first
web
browser
2008
The first iOS
app is
released
The first
FitBit is
released
1999
Salesforce.com
founded
2007
The first
iPhone is
released
Amazon
Web
Services
launches
drastically
reducing
the cost of
server
ownership
2004
Facebook is
founded
2006
Twitter is
founded
2010
The first
iPad is
released

4. SaaS
PaaS
IaaS
iPaas
Creative Cloud

5. History of Enterprise Technology and Customer Experience Platforms
ERP
Finance
Key Players: 2
• SAP was founded in 1972
• Oracle was founded in 1977
CRM
Sales and Care
Key Players: 2
• Salesforce was founded in
1999
EMP
Marketing
Key Players: 5
Other Players: 1871
• EMP appeared first in
Forrester Wave in 2014

6. Marketing technology are tools that make life simpler for marketers to market. They
automate difficult, time-consuming and repetitive manual tasks to surface customer
insight. Built by technologists, used by marketers. Marketing technology should aim to
remove or significantly reduce the need for IT involvement.
What is Martech?
Product Marketing
Care Sales
Customer
Campaign
Content
Audiences
Data
Marketing technology are tools that make life
simpler for marketers to market and drive
awesome customer experience. They
automate difficult, time-consuming and repetitive
manual tasks to surface customer insight.
Marketing Technology addressed one or more of
these capabilities:
• Campaign: The “Why”. Ability to manage the “business of
Marketing” though campaign management, top down strategy
deployment and metadata to perform ROI calculations.
• Content: The “What”. Creation, management, distribution and
delivery to any channel of content. Content comprises of any
combination of pictures, video and copy.
• Audiences: The “Who”. Sometimes called “Segments”, it a
grouping of individuals based on metadata (demographic,
firmagraphic, behavioral and corporate)
• Data: The “So What”. Collection of the above data sets for
assembly for insights and delivery of near time customer
experience.

7. Martech Acceleration:
2013 – 2014 – Vendor
grows ~200% (947 to
1876)
Estimated TAM (2015)
- $17.6B with 21%
CAGR

8. Most as SaaS or PaaS
= 72%.
Exceptions are
Middleware, Backbone
Platforms and
Infrastructure.
= 28%
Marketing Experiences
979 vendors = 52%
SaaS or lightweight PaaS
Marketing Operations
377 vendors = 20%
SaaS or lightweight PaaS
Middleware - 114 Vendors = 6%
PaaS or IaaS
Backbone Platforms - 241 Vendors = 13%
PaaS and/or IaaS
Infrastructure - 165 Vendors = 9%
IaaS

9. Martech Acceleration:
2013 – 947
2014 - 1876
2015 - ~3500

11. Martech Acceleration: 1990’s to 2013 – Platform Players Spend ~$4B each to build their “Marketing Cloud”
EMP Players have spent ~$4B in acquisitions to build their “Marketing Cloud”…
And they haven’t stopped buying to build...

12. Design
Execute
Measure
Optimize
Plan Tactically
No vendors, manual processes
Some vendors, not integrated
Multiple vendors, not integrated
Strategic
Brief
Creative Briefs
Programs
Campaigns
Activities
Promotions
Marketing vendors are disproportionately
developing technology for the “Execute”
phase of the Marketing lifecycle.
There are technology gaps in
capturing corporate metrics with
marketing results.
Platform and infrastructure marketing
technology to is nascent.
52% of Marketing Vendors
Audiences
Campaigns
Assets
Data

13. The Intuit Journey – How Value is Determined
CX Vision
Deliver Awesome CX
at every Intuit touch
point
Capability Strategy
Enable employees to deliver
awesome CX across every Intuit touch point
Martech Architecture
Build a durable, scalable & secure
CX platform to fuel Intuit vision & strategy
Source: Intuit

14. Intuit chose Multi-platform out of the 4 types of “stack” – Prevalent
Enterprise Martech ”build” behavior.
• Suite
• Platform
• Multi-platform
• Bus

15. Martech Revenue Stream Considerations - Pricing Buckets
• Annual Licenses (Users, Instances, Storage) – Eloqua, AEM, SFDC
• Consulting
• Contracts with 3rd Party Vendors for Delivery (Big 5)
• Bundling – Licenses w/ consulting, Multiple product licenses (Cross
sell / upsell), Multiyear
• Obsolete
• Versions - no price upgrade. Increase annually through the
Annual Licenses.

16. Martech Vendor Pricing Strategy
Vendor Technology Type Pricing Strategy
Adobe Marketing Cloud Content, experience
delivery, ad spending,
campaign management
On premise,
SaaS and
PaaS
• Penetration via increased functionality, cross
sell, upsell and consulting
Salesforce.com Social Listening,
experience delivery,
social advertising,
campaign management
SaaS and
PaaS
• Skimming with high priced entry cost on
“instance”
• Penetration with additional “clouds”, user,
functionality and consulting
• Additional pricing to vendors to connect to
their platform (reputed $25M / annually)
Amazon Web Services *aaS Infrastructure IaaS • Penetration via increased storage
Marketo Marketing Automation SaaS and
PaaS
• Penetration via increased functionality
packages
Kapost Content Marketing SaaS, iPaaS • Penetration via increased functionality
packages
Cloudwords Content Localization SaaS, iPaaS • Penetration via increased functionality
packages and # of integrations.

17. Enterprise SaaS transition to Subscription Business Model: The Revenue
Recognition Problem
FY14 FY15 FY16 FY17
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
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Perpetual
Subscription
Perpetual to
Subscription
Transition
Customer Purchase: $1M
Full amount - revenue recognized next fiscal month
Customer Purchase: $4.5M, discounted to $3.6M – 3 year subscription
Revenue recognized next fiscal month for $100k
Customer Purchase: $12M.
Full amount - revenue recognized next fiscal month
Total: $800K
Customer Purchase: $800k
Full amount - revenue recognized next fiscal month
Customer Purchase: $4.5M, discounted to $3.6M – 3 year subscription
Revenue recognized next fiscal month for $100k
Total: $2M

18. Considerations: Pricing or Product Careers - Startup vs. Enterprise
Startup
• How will you build?
• Web Service or Data Farms?
• What will be your business model?
• Skimming
• Penetration
• Cross sell
• Upsell
• Consulting
• Partnerships
Enterprise
• International and regulatory issues.
• Privacy: Customer Data
• Multitenancy: Transactional Data
• Transition issues:
• Is the back office ready?
• Business Models
• Pricing
• Finance – billing readiness. PO to Credit Cards
• Product
• IT: CRM, ERP
• Are the customers ready?
• Are your internal teams ready? (Sales, Marketing, Support)

19. Appendix

20. 20% 10x -15% 70%
Plan
Automate the
operational process
that supports
marketing.
Design
Manage the creative
development process
and deliver to market.
Execute
Deliver targeted
experiences based on
customer behavior.
Measure
Track marketing
effectiveness back to
business metrics.
Integrate
Capture 360-views of
customer engagement
through CRM and
engagement systems
Optimize
Understand your
success and direct
investments to areas of
value.
1 2 3
456
Increase in
conversion rates
Response ratio of
campaigns
Decrease in
acquisition cost
Faster time for
Speed-to-Market
Source: Deloitte Engagement, January 2015
A methodical approach to marketing automation results in real measurable benefits. Closed loop
marketing is a repetitive, ongoing process, not a destination or a single project. It is important to
define measurable goals for Intuit SBG that can be optimized for over time.
Marketing Automation is a foundation an
optimized marketing lifecycle

21. EMP Capability Framework (Template)
Wearables Gamingi-Beacons In Person Machine to Machine
Enablers
Platform Orchestration
Marketing PaymentCustomer LoyaltySales & Operations ServiceFulfillment
Analytics and Insights
Profile Generation
Social Media
Interaction
Predictive /
Cognitive Analytics
Localized
Promotions
Personalization /
Recommendations
Mobile Payments
Campaign
Automation
Lead
Management
Recommendation
Engine
eCommerce
Virtual Customer
Service
Mobile Apps
Recognition
Program
Regional Specific
Flavors
Single Customer
View
Community
Engagement
Digital Content
Advanced
Visualization
Real-time
DevOps
Ambient Computing /
Internet of Things
Adaptive
Design
Cloud
Orchestration
In-Memory
Solutions
Financials Supply Chain
Order
Management
Case
Management
CRM
Product
Catalog
Customer
Master
Social Mobile PhoneWebContextual and Seamless
across customer touch points
Marketing automation is a critical piece of the broad customer engagement systems, and be
appropriately integrated with other capabilities within the other enterprise technical architecture.
Source: Deloitte Engagement, January 2015

22. Path to Defining Customer Journeys and Campaigns
Journey Scope
Touch Points
User Flow
Message Inventory
Content Template
Requirements Tracker
Identify Business
Objective and relevant
Content Story
Identify tactics from Multi-
channel plan
Identify audience / target
customers
Identify timing and
frequency of journey
Map the channel touch
points for the journey
Align content to each step
Identify calls-to-action
Map alternative paths in
the journey (branch logic)
Drill down into each step
of the journey
Determine
personalization needs
Map customer attributes
to personalization
Review journey for
content gaps
Document data needs for
triggered events
Complete the journey
blueprint document using
completed templates
Review and approve
Begin to configure
Define Objective
Identify Journey
and content
Determine
Personalization
Finalize
Requirements
Templates

23. Intuit Current Marketing Capabilities State Assessment
Intuit CE current state is fragmented across products and channels
Segmentation
Capability
Research insights
CX Definition
(Personas/ Journeys)
Definition
Using various research to provide a holistic understanding
of customers’ needs across the entire lifecycle
Bring customers to life by designing personas and journey
maps to drive strategic and operational decisions to enable
impactful interactions
Developing Practicing Innovative
Current
Capabilities
Target
Capabilities*
Customer Data
Analytics
Capturing, storing and cleansing customer data to make
business decisions and derive insights into customer
preferences, priorities and behavior
Understanding of market and customer base using multiple
schemes with a dynamic view. enabling the transition of
customers across segments
Touchpoint and
Content Strategy
Creating and delivering valuable, relevant and consistent
marketing content in a coordinated manner across multiple
channels and touchpoints
Source: Deloitte Engagement, January 2015

24. Marketing Automation CX Transformation: Future 0-7 Day Trialers
Unopen, No Log-in
“Take a Tour” Email
Day 0: Registers for Trial
Opens, “Clicks “Take a Tour”
Welcome Email
(12k / wk new Trialers)
Day 7
Opens Welcome Mail
Clicks “Add Bank Info”, Closes w/no entry
Send “Bank Info Entry Benefits” Email
Open “Bank Info Entry
Benefits” Email
Clicks “Subscribe Now
$9.99/mo”,
No Log-in for 5 days
Send “Get One Month For Free” Email
Open, “Nurture”
Day 8 – 29 Trialer Program
“Right for me” marketing messages based on customer behavior;
Full visibility to customer experience allow optimized customer experience across marketing, sales, care.
0
+2
+1 +1
Web Sale fulfilled
Shows on top of the
SFDC Lead Queue
based on Lead Score
>3
+2
+2-1
Add to “Nurture
Day 30-59 Trialer” Program<=3

25. 1. Customer Experience
Definition
2. Data/Unified Customer
Profile
Sample - Roadmap – Value Milestone View
The two year roadmap is intended to provide direction to planning, execution and roll-out, and is subject to iterative refinement and re-planning based on business priorities
and value drivers.
4 months
POC
6 months
1. Customer Engagement
Automation
2. Marketing Resource
Management
3. Audience Management
4. Journey Analytics
P1 P2 P3
Dependencies
6 months 8 months
Initiatives
Milestones
• Validated
platform choice
and business
case
• Conversion and
lead metrics
validated
• Business case
and execution
plan developed
• Email campaign
efficiency lift
• Web campaign
tracking
• Increased lead
conversion
through funnel
for a small set
of products
• Marketing &
sales gains
• Cross-
channel
campaign
efficiency lift
• Journey
analytics
• Increased
lead quality
for SBG
telesales and
ProTax
• Revenue
• Conversion lift
across sales,
marketing,
care
interactions
• Efficiency and
visibility gains
in overall
campaign
execution
• LTV tracking
and lift
• Conversion,
lead quality,
and campaign
cost gains
across SBG
in North
America
• Initial gains in
geo
campaigns
and
engagement
• Coordinated
campaign
execution
across
marketing,
sales, care,
product
• Ongoing
global roll-out
and campaign
scale
• Global
efficiency lift
• Increased
GNS & LTV
globally
• True
campaign
ROI tracking
and
improvement
• Ongoing C-
Sat gains
• Ongoing ROI
optimization
• Full global
roll-out
• Planning,
tracking,
execution,
and
measurement
across SBG