Zeta Global's Unique Customer Data Platform and Positive Market Outlook
2023-08-04
Zeta Global, led by its Co-Founder, Chairman, and CEO, David Steinberg, held an earnings call meeting to discuss the company's financial performance and growth. The meeting focused on the accelerated profit growth and the dropping incremental margin, which were the key topics of discussion.
One particularly interesting topic discussed during the meeting was Zeta's Customer Data Platform (CDP). CEO David Steinberg highlighted that the CDP opportunities were mostly untapped, indicating a significant growth potential for Zeta in this market. He also emphasized that Zeta's CDP was unique as it integrated a data cloud and AI implementation, offering a comprehensive solution for seamless activation. This differentiation could give Zeta a competitive edge over other vendors.
During the meeting, an analyst from Morgan Stanley inquired about Zeta's success rate in Request for Proposals (RFPs) involving competitors like Salesforce, Oracle, and Adobe. Unfortunately, the provided information does not include Steinberg's response to this question. However, this topic suggests that Zeta is likely competing with major players in the industry and could provide insights into Zeta's market positioning and potential challenges in winning RFPs against established competitors.
To gain a deeper understanding of Zeta's market position, further information is needed regarding their market share, revenue growth, customer feedback, and specific case studies or success stories related to their CDP. Additionally, it would be beneficial to compare Zeta's CDP offering with those of Salesforce, Oracle, and Adobe to understand Zeta's unique value proposition and potential areas of differentiation.
The market outlook for Zeta appears positive based on their consistent performance, increasing operating margin, and closing of larger deals. The decrease in customer nervousness and shortening sales cycle indicate increased confidence and aggressiveness among marketers. The emergence of generative AI technology is expected to drive a large replacement cycle in the marketing cloud industry, benefiting Zeta. Zeta's focus on small language models within the customer data platform ecosystem is resonating well with enterprises. Overall, Zeta expects continued growth and success in the market.
The key drivers of Zeta's business are super-scaled customers, sales productivity, SG&A expenses, and market share in advertising technology. The competitive landscape for Zeta is evolving positively, with the company consistently exceeding expectations, closing larger deals, and experiencing a shorter sales cycle. The emergence of generative AI is driving discussions in the industry, and Zeta believes that the next year will see a significant replacement cycle in the marketing cloud sector. Zeta's focus on small language models and personalized insights without sharing data externally is resonating well with enterprises. Overall, Zeta expects to see more positive developments in the competitive landscape in the coming quarters.
During the meeting, the most important Key Performance Indicators (KPIs) discussed were customer acquisition, revenue bands, bigger deals and closing percentage, and growth rates. Zeta added 52 scaled customers in the last 12 months, demonstrating its ability to attract and onboard new customers. Out of these customers, 32 were in the less than $500K revenue cohort, and the company expects them to move up to the million-dollar revenue band, reflecting its growth potential and ability to upsell existing customers. The company is also seeing bigger deals and closing a greater percentage of them, demonstrating its success in securing larger contracts and converting leads into sales. Additionally, the company is tracking ahead of plan in terms of growth rates, with the top line and bottom line growth rates six points faster than initially projected.
Zeta's outlook for the quarter and the year appears positive, with consistent performance, exceeding expectations, and increasing operating margin. The company is closing larger deals and improving sales cycle efficiency. Additionally, they anticipate a significant replacement cycle in the marketing cloud industry, driven by the popularity of generative AI and their focus on small language models. Overall, Zeta is optimistic about their projections for both the third quarter and the entire year.
The participants of the call included David Steinberg, Co-Founder, Chairman, and CEO; Scott Schmitz, Senior Vice President of Investor Relations; Chris Greiner, CFO; and several analysts from various institutions. During the call, David Steinberg expressed his pride in the team's ability to drive profit growth and achieve incremental margin growth. He also highlighted the company's track record of beating and raising projections for eight consecutive quarters. The call concluded with the mention of an upcoming event called Zeta Live, scheduled for September 27th and 28th.
In conclusion, Zeta Global's earnings call meeting provided insights into the company's accelerated profit growth, unique Customer Data Platform, and positive market outlook. With a focus on customer acquisition, revenue bands, and closing bigger deals, Zeta is positioning itself for continued growth and success in the competitive landscape.