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TBR
T EC H N O LO G Y B U S I N ES S R ES EAR C H , I N C .
2012 Strategies to Drive 2013 Revenue: Insights from TBR’s 4Q12 Software Vendor Benchmark
Technology Business Research Quarterly Webinar Series
April 10, 2013
TBR
2 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Insights from TBR’s 4Q12 Software Vendor Benchmark: Webinar Presenters
Elizabeth Hedstrom Henlin Enterprise Software Analyst [email protected] @EAHHTBR
Stuart Williams Director, TBR’s Software and Cloud Practice [email protected] @s2_williams
TBR
3 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Go-to-Market Execution: Realign corporate infrastructure and investment to speed sales execution.
Business Reinvention: Extend core value propositions and portfolios to globally align with high-interest customer trends.
Vendors in TBR’s Software Vendor Benchmark will grow revenue in 2013 by balancing core business investments with disruptive growth strategies
Insights from TBR’s 4Q12 Software Vendor Benchmark: Highlights and 2013 Outlook
Software Vendor Outlook for CY13: Paths to Success
Revenue Growth: Sustain and defend install bases while increasing spend in new markets and segments.
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
TBR
4 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
2H13 promises some initial customer spending recovery, and vendors are adjusting investments to capitalize on early momentum
Insights from TBR’s 4Q12 Software Vendor Benchmark: Benchmark Overview
Though CY12 was a year of slowed revenue growth for vendors in TBR’s Software Vendor Benchmark, overall revenue held steady, positioning vendors for growth in CY13
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
2008 2009 2010 2011 2012
AGGREGATE REVENUE (IN $ BILLIONS) $166 $162 $183 $205 $213
AGGREGATE REVENUE GROWTH YEAR-TO-YEAR 12% -3% 13% 12% 4%
TBR
5 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Rapid adoption of disruptive solutions is pressuring traditional vendors to explore both traditional and emerging IT deployment trends
Insights from TBR’s 4Q12 Software Vendor Benchmark: Benchmark Overview
Incorporating cloud and mobility into core solutions will help vendors combat attrition and capture opportunities for growth in new market segments
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
INTUIT MSFT
SAP
SYMANTEC
ADOBE
AUTODESK
BMC
CA TECHNOLOGIES
CHECK POINT
EMC
CITRIX
COMMVAULT
COMPUWARE
HP SW
JDAIBM SW
INFORMATICA
OPEN TEXT
ORACLE
RED HAT
SAGE
SOFTWARE AG
TIBCO
TOTVS
TREND MICRO
VMWARE
PROGRESS
-40.0%
-30.0%
-20.0%
-10.0%
0.0%
10.0%
20.0%
30.0%
40.0%
-10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0%
Avg
. An
nu
al R
even
ue
Gro
wth
4Q12 Revenue Growth
Average Quarterly Revenue Growth = 6% Average Annual Revenue Growth Year-to-Year = 6.2%
4Q12 REVENUE GROWTH VS. AVERAGE ANNUAL REVENUE GROWTH
TBR
NETSUITE(33%, 31%)
Dell Enterprise Software(554%, 514%)
SALESFORCE(32%, 35%)
SLIPPING
LAGGARDS
LEADERS
IMPROVING
TBR
6 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Insights from TBR’s 4Q12 Software Vendor Benchmark: Highlights and 2013 Outlook
TBR
7 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Business Reinvention: Extend core value propositions and portfolios to globally align with high-interest customer trends.
Vendors in TBR’s Software Vendor Benchmark will grow revenue in 2013 by balancing core business investments with disruptive growth strategies
Insights from TBR’s 4Q12 Software Vendor Benchmark: Highlights and 2013 Outlook
Software Vendor Outlook for CY13: Paths to Success
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Go-to-Market Execution: Realign corporate infrastructure and investment to speed sales execution.
Revenue Growth: Sustain and defend install bases while increasing spend in new markets and segments.
TBR
8 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Vendors are turning to value-add features as extensions of core portfolio products — aligning to high-interest trends, including cloud, mobility and business inteligence, or industry-focused deployments — to defend their install bases and to grow their share of wallet.
Vendors face the delicate balancing act of shifting portfolio strategies to drive long-term growth without risking stable revenue from core products
Software Vendor CY13 Paths to Success: Revenue Growth
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Insights from TBR’s 4Q12 Software Vendor Benchmark: Key Trends
TBR
9 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Average annual license revenue growth across TBR’s 4Q12 Software Vendor
Benchmark fell to 13.8% in 4Q12 relative to 18.1% growth in 4Q11
Leading vendors are countering extended purchasing cycles with traditional software solutions and new delivery methods
Insights from TBR’s 4Q12 Software Vendor Benchmark: Key Trends
TBR
10 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Profiled vendors are aligning core portfolios to customers’ business needs — even adding new delivery methods — to ensure CY13 growth
BMC Software: Mobile computing and Business Service Management (BSM) are differentiators for BMC that cut across product segments in cloud, mainframe and service management and that will help BMC protect and grow its customer base.
CA Technologies: New CA CEO Michael Gregoire will slim sales management and evolve KPIs to ensure sales of both cloud and traditional software, improving operating margins.
Red Hat: New products and businesses, particularly cloud computing, demand Red Hat scale investment in sales and channel teams to ensure that go-to-market timing for these Red Hat offerings is not slowed as a result of personnel ramping up within the company.
SAS: TBR research shows financial services and retail at the leading edge of analytics adoption. We believe SAS’ prioritization of R&D investment and focus on high-impact products for verticals will drive material revenue growth for SAS in 2013.
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Insights from TBR’s 4Q12 Software Vendor Benchmark: Covered Vendor Research Highlights
Highlighted Case Studies — 4Q12 TBR Software Business Quarterly Vendor Reports
TBR
11 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Business Reinvention: Extend core value propositions and portfolios to globally align with high-interest customer trends.
Vendors in TBR’s Software Vendor Benchmark will grow revenue in 2013 by balancing core business investments with disruptive growth strategies
Software Vendor Outlook for CY13: Paths to Success
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Insights from TBR’s 4Q12 Software Vendor Benchmark: Highlights and 2013 Outlook
Go-to-Market Execution: Realign corporate infrastructure and investment to speed sales execution.
Revenue Growth: Sustain and defend install bases while increasing spend in new markets and segments.
TBR
12 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
• Vendors within TBR’s Software Vendor Benchmark are balancing the simultaneous needs to increase sales coverage, reduce costs and evolve portfolio positioning, all without negatively impacting margin.
• Firms including Symantec, HP Software and Oracle embraced 4Q12 and 2012 strategic realignments in internal organization, portfolio and go-to-market strategies to better position themselves for growth.
Software Vendor CY13 Paths to Success: Go-to-Market Execution
Vendors are challenged to accelerate new-hire monetization — especially within sales — or pay broader prices in profit and margin erosion
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Insights from TBR’s 4Q12 Software Vendor Benchmark: Key Trends
TBR
13 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Margin leaders improved internal efficiency and cost control to sustain
profitability and underpin investment despite incremental revenue growth
Aligning sales with evolving portfolios will increase vendors’ go-to-market efficiencies — a key driver of margin growth in CY13
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Insights from TBR’s 4Q12 Software Vendor Benchmark: Key Trends
TBR
14 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Profiled vendors are reacting to extended purchasing cycles by pairing sales investment with corporate realignment, maximizing execution
Symantec: By focusing sales teams on new opportunities while establishing a renewals team, Symantec is shifting its corporate focus to continuous sales process innovation to accelerate the creation of revenue growth opportunities. The resolution of internal inefficiencies resulting from past acquisitions will position Symantec to effectively sell solutions across its portfolio.
HP Software: In 4Q12 HP Software simplified its portfolio positioning by bundling products to address four major markets: cloud/IT management, enterprise security, big data analytics (Vertica) and meaning-based computing (Autonomy). This reorganization helps HP Software improve perception, shorten its sales process and drive CY13 revenue growth.
Oracle: TBR maintains Oracle’s CY12 hiring campaigns and its training and realignment of sales around product specializations position Oracle to rapidly monetize new hires across CY13. Oracle direct sales will increase its near-term presence across accounts, with specialized sales teams set to expand customer consumption of the Oracle product portfolio.
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Insights from TBR’s 4Q12 Software Vendor Benchmark: Covered Vendor Research Highlights
Highlighted Case Studies — 4Q12 TBR Software Business Quarterly Vendor Reports
TBR
15 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Business Reinvention: Extend core value propositions and portfolios to globally align with high-interest customer trends.
Vendors in TBR’s Software Vendor Benchmark will grow revenue in 2013 by balancing core business investments with disruptive growth strategies
Software Vendor Outlook for CY13: Paths to Success
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Insights from TBR’s 4Q12 Software Vendor Benchmark: Highlights and 2013 Outlook
Go-to-Market Execution: Realign corporate infrastructure and investment to speed sales execution.
Revenue Growth: Sustain and defend install bases while increasing spend in new markets and segments.
TBR
16 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
• With continued global economic instability, vendors are focusing on maintaining customer bases while cautiously investing in growth.
• Targeting regional investments to maximize investment efficiency and messaging alignment will be critical to ensuring that vendors realize revenue growth across geographies in CY13.
Vendors are looking to jumpstart global growth by extending their reach; but regional markets demand differing portfolio and messaging strategies
Software Vendor CY13 Paths to Success: Business Reinvention
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Insights from TBR’s 4Q12 Software Vendor Benchmark: Key Trends
TBR
17 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
With the U.S. market continuing to mature, growth leaders in the Americas are driving new footprints in high-growth product segments
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Insights from TBR’s 4Q12 Software Vendor Benchmark: Key Trends
Average Americas annual revenue growth for vendors in TBR’s 4Q12 Software
Vendor Benchmark was 23.4%, up from 4Q11 and year-to-year growth of 13.2%.
TBR
18 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
BMC
MSFT
SAP
ADOBE
CITRIX
CHECK POINT
COMMVAULT
COMPUWARE EMC
JDA
NETSUITE
OPEN TEXT
ORACLE
HP SW
INTUITAUTODESK
RED HAT
SAGE
SOFTWARE AG
IBM SWTIBCO
INFORMATICA
TREND MICRO
VMWARE
PROGRESS
SYMANTEC
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
-15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%
Co
rpo
rate
Rev
enu
e G
row
th
EMEA Revenue Growth
4Q12 EMEA GROWTH VS. CORPORATE GROWTH
Average EMEA Revenue Growth Year-to-Year = 23.8% Average Corporate Revenue Growth Year-to-Year = 24.2%
TBR
CA TECHNOLOGIES (-21.2%, -5.4%)
Dell Enterprise Software(576.3%, 553.9%)
Salesforce.com(37.4%, 32.1%)
Insights from TBR’s 4Q12 Software Vendor Benchmark: Key Trends
Pockets of segment-specific growth in mature European markets continue to sustain incremental regionwide revenue growth in EMEA
Average EMEA annual revenue growth for vendors in TBR’s 4Q12 Software
Vendor Benchmark was 23.8% year-to-year, relative to 4Q11’s increase of 11.7%.
TBR
19 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
PROGRESS
MSFT
SAP
ADOBE
CA TECHNOLOGIES
CHECK POINTCOMPUWARE
EMC
HP SW
INTUIT
NETSUITE
ORACLE
IBM SW
BMCRED HAT
SAGE
SALESFORCE
SOFTWARE AGAUTODESK
SYMANTECINFORMATICA
TIBCO
TREND MICRO
CITRIX
-20.0%
-10.0%
0.0%
10.0%
20.0%
30.0%
40.0%
-20.0% -10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0%
Co
rpo
rate
Re
ven
ue
Gro
wth
APAC Revenue Growth
4Q12 APAC GROWTH VS. CORPORATE GROWTH
TBR
Average APAC Revenue Growth Year-to-Year = 30.8% Average Corporate Growth Year-to-Year = 24.2%
CommVault(63.1%, 23.6%)
4Q12 APAC GROWTH VS. CORPORATE GROWTH
TBR
Average APAC Revenue Growth Year-to-Year = 30.8% Average Corporate Growth Year-to-Year = 24.2%
Dell Enterprise Software(422.3%, 553.9%)
OpenText(52.1%, 9.6%)VMware(50.9%, 22.0%)
Insights from TBR’s 4Q12 Software Vendor Benchmark: Key Trends
Awareness-focused vendor spend in APAC — increasing physical presence to accelerate sales traction — fueled double-digit revenue growth in 4Q12
Average APAC annual revenue growth for vendors in TBR’s 4Q12 Software Vendor
Benchmark was 30.8%, building on 4Q11’s year-to-year growth of 19.2%.
TBR
20 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Profiled vendors will drive CY13 revenue gains by balancing efficient execution and direct portfolio messaging
Microsoft: Microsoft’s refreshed products and cloud solutions are well-timed for worldwide customers’ needs, and TBR projects that Microsoft will see positive revenue results from these CY12 launches in CY13, particularly in APAC.
SAP: TBR believes placing regional direct sales and channel sales under SAP President of Global Operations Rob Enslin and adjusting regional sales to increase the authority and autonomy of regional leads enables SAP to increase sales agility by empowering regional sales leads to expedite efforts, drive growth and better answer the needs of in-region customers.
IBM Software: IBM continues to build on its strategic focus on high-growth markets, reporting that more than 30 of its targeted growth countries saw double-digit growth in 4Q12.
VMware: VMware will grow headcount in target markets in APAC (including China and Japan), Eastern Europe and Latin America in order to support and sustain revenue growth in CY13.
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
Insights from TBR’s 4Q12 Software Vendor Benchmark: Covered Vendor Research Highlights
Highlighted Case Studies — 4Q12 TBR Software Business Quarterly Vendor Reports
TBR
21 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Outlook and Projections
TBR
22 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Go-to-Market Execution: Balanced investment in new customer acquisition and net-new market segments has the highest potential to jumpstart CY13 vendor revenue growth.
Business Reinvention: To drive reinvention without disrupting core businesses, vendors must focus on cross-selling core products to new or acquired customers.
Vendors will drive short-term growth and long-term opportunities across CY13 by balancing targeted investments with tight cost controls
Insights from TBR’s 4Q12 Software Vendor Benchmark: Highlights and 2013 Outlook
Software Vendor Outlook for CY13: Outlook
Revenue Growth: TBR projects accelerating enterprise software growth in 2H CY13 as vendors drive adoption in new customer bases and markets.
SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES
TBR
23 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Questions?
TBR
24 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
For further information, please contact:
Stuart Williams James McIlroy Director, Software and Cloud Practice Vice President, Sales [email protected] [email protected]
TBR
T EC H N O LO G Y B U S I N ES S R ES EAR C H , I N C .
About TBR Technology Business Research (TBR) is a leading independent technology market research and consulting firm specializing in the business and financial analyses of hardware, software, networking equipment, wireless, portal and professional services vendors. Serving a global clientele, TBR provides timely and accurate market research and business intelligence in formats that are tailored to clients’ needs. Our analysts are available to further address client-specific issues or information needs on an inquiry or proprietary consulting basis. TBR has been empowering corporate decision makers since 1996. To learn how our analysts can address your unique business needs, please visit our website or contact us today.
Contact Us
1.603.929.1166 [email protected] www.tbri.com 11 Merrill Drive Hampton, NH 03842 USA
This report is based on information made available to the public by the vendor and other public sources. No representation is made that this information is accurate or complete. Technology Business Research will not be held liable or responsible for any decisions that are made based on this information. The information contained in this report and all other TBR products is not and should not be construed to be investment advice. TBR does not make any recommendations or provide any advice regarding the value, purchase, sale or retention of securities. This report is copyright-protected and supplied for the sole use of the recipient. Contact Technology Business Research, Inc. for permission to reproduce.
TBR
26 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
Appendix
TBR
27 TBR Quarterly Webinar Series | 4.10.13 | www.tbri.com | ©2013 Technology Business Research Inc.
TBR covers the vendors that make and shape enterprise software and cloud computing markets
Software Vendor Reports (SBQ)
Cloud Vendor Reports (CLBQ)
Benchmarks and Market Landscapes
• BMC Software • CA Technologies • HP Software • IBM Software • Microsoft Corp. • Oracle Corp • Red Hat • SAP AG • SAS* • Symantec • VMware
• Amazon Web Services* • Google Cloud* • IBM Cloud* • Microsoft Cloud* • Oracle Cloud* • Rackspace* • Salesforce.com* • ServiceNow* • Verizon Cloud*
Software Vendor Benchmark • Includes publicly held SBQ report vendors as
well as 19 additional firms
Public Cloud Market Landscape • Includes the public cloud business of CLBQ
report vendors as well as 28 additional firms
Coming in CY13: Coming in CY13: Coming in CY13:
• Dell Software • EMC Software • Infor*
• Fujitsu Cloud* • HP Cloud* • Dell Cloud* • Workday* • NetSuite* • SAP Cloud*
• Applications Vendor Market Landscape • Systems Management Vendor Market Landscape • Business Intelligence and Analytics Vendor Market
Landscape • BRIC Region – Applications Vendor Market
Landscape
*Semiannual publication
Appendix: TBR’s Software and Cloud Business Quarterlies
NOTE: The Cloud Business Quarterly and TBR’s cloud research will be covered within the Cloud Business Quarterly Research Highlights and Outlook Webinar.
TBR
T EC H N O LO G Y B U S I N ES S R ES EAR C H , I N C .
About TBR Technology Business Research (TBR) is a leading independent technology market research and consulting firm specializing in the business and financial analyses of hardware, software, networking equipment, wireless, portal and professional services vendors. Serving a global clientele, TBR provides timely and accurate market research and business intelligence in formats that are tailored to clients’ needs. Our analysts are available to further address client-specific issues or information needs on an inquiry or proprietary consulting basis. TBR has been empowering corporate decision makers since 1996. To learn how our analysts can address your unique business needs, please visit our website or contact us today.
Contact Us
1.603.929.1166 [email protected] www.tbri.com 11 Merrill Drive Hampton, NH 03842 USA
This report is based on information made available to the public by the vendor and other public sources. No representation is made that this information is accurate or complete. Technology Business Research will not be held liable or responsible for any decisions that are made based on this information. The information contained in this report and all other TBR products is not and should not be construed to be investment advice. TBR does not make any recommendations or provide any advice regarding the value, purchase, sale or retention of securities. This report is copyright-protected and supplied for the sole use of the recipient. Contact Technology Business Research, Inc. for permission to reproduce.