The State of Email Marketing: Email Marketing Service providers in Denmark

Michael Leander

Email Marketing technology has evolved rapidly over the past years. We take a look at the State of Email Marketing Service Providers (ESPs) in Denmark.
This blog post is part of our country-ESP-break-down series of covering what’s up in the email marketing technology space in Europe and the Middle East.

In our ESP country break-down we discuss the business side of Email Marketing Service Providers as a service to our clients and followers. We tell it as we see it and report on the basis of our four fundamentals for ESP’s – which are:

1. Does the Email Marketing Service Provider present a unique differentiated offering?
2. Does the ESP have critical mass or is the ESP likely to get critical mass within 1-2 years time?
3. The reputation of the ESP from what we can gather through word-of-mouth, customer experiences and research online
4. What is the financial background of the Email Marketing Service provider

Here is our report from the email marketing trenches in Denmark.

Please note that we have received word that certain international ESP’s are missing from the list. Entry level vendors such as CampaignMonitor, MailChimp, GetResponse etc surely have customers in Denmark, however we do not see these as significant players in terms of the SME and Enterprise markets.

The Email Marketing Kingdom of Denmark

Denmark (along with markets such as Sweden and the Netherlands) is one of the most mature markets for email marketing in Europe. One of the first email marketing service providers Atteno (which was later acquired by Guava) was established in the late 1990′s. Since then the market has seen quite a few new local players enter. Some have managed to stay afloat, while others either have folded or been snapped up by somebody bigger.

The country has produced quite a few exceptionally well planned and executed email marketing campaigns including those from Kilroy Travels and Scandinavian Airlines (SAS). A large number of brands regularly publish permission based (opt-in) newsletters. Some of the better ones we know of are IDE Møbler and Danske Spil.

In recent years some of the bigger global players such as Responsys (direct representation) and Exact Target (through dedicated reseller Core Relations) have entered the Danish email marketing arena. We know of at least two more ESP’s contemplating a move into the Danish market to bridge their expansion in to the Nordics from there. If that materializes we are looking at some 15 ESP’s competing for an estimated market of some 15-20.000 potential customers.

We find it interesting that such a small market can attract so much attention.  Here is our take on the some of the most important email marketing technology vendors in Denmark categorized into “the leaders”, “newcomers and others”, “foreigners” and “the upper class“. The upper class are no less important than the others, however we couldn’t come up with a better term on the fly.

The leaders measured in number of paying end-user customers now and/or in the near future:

Zoomio – RIP – Zoomio no longer exists: Apsis acquired Zoomio assets

Zoomio burned through loads of cash – at least € 7 million to be exact. In 2011 investors had enough and declared the company bankrupt.

Anders Frankel’s Email service provider Apsis from Sweden acquired the key assets such as the software, brand names and customer data from the bankruptcy estate of Zoomio. Apsis will seek to migrate Zoomio customers to the Apsis Email Marketing platform.

As a footnote, Per John Jensen – former CEO of Zoomio – have taken on a new role to bring German Email Marketing Service Provider e-Circle into the Scandinavian market.

Globase most likely next up for acquisition

Founded in Denmark in 1999 and then later acquired by German company AdPepper in 2006, Globase International seems to remain focused solely on the Danish market. With a staff of around 15 people, Globase is known to take very good care of their customers – many of whom have been with them for 5-6 years. After experiencing serious scalability problems in 2004-2006, Globase chose to rebuild their platform to improve performance, scalability and the feature richness of that platform.  We’ve spoken to clients of theirs who are quite happy about the solution.

How are they unique? A relatively mature full scale email marketing solution with an above average UI, we’d have to say that their support/customer service/client care is what makes Globase stand out from the rest.
Critical mass? We estimate Globase client base to be around 400-450 paying customers. Hardly critical mass from an international perspective, but good enough to make a difference in Denmark.
Reputation? Best reputation in the business. Clients mention excellent customer care and like the fact that Globase owners seem to be financially solid. A few people we’ve spoken to thought Globase went out of business due to the fact that their website was not updated for several years !! (it is now though)
Financial background according to Soliditet / Nordic Business View: With an increase in revenue by some 40% from 2008 to 2009, Globase had revenues in fiscal year 2009 of DKK 11 mill (€ 1,5 mill) and landed an impressive DKK 2,1 mill EBIT.  Owner AdPepper is a publicly listed stock with a solid financial background.

Management recently changed at Globase – so we think we might see a more aggressive approach to the market from Globase in 2011. Question is; will they finally make their move to enter new international markets leveraging AdPeppers international representation or is next step to attract an acquisition. Time will tell.

Update October 2011: Globase managed to grow revenues to DKK 12,7 million [€ 1,7 mill] in fiscal year 2010 and landed an impressive profit of DKK 2,5 million [€  360 K]. This would suggest that Globase are adding customers or growing the value of the existing portfolio. Word on the street is that the latter would be most accurate.

Apsis – most likely to acquire most new customers

Swedish Email Marketing Service provider Apsis have been going from success to success. Founded in Sweden in 2001 they have build a solid, money making business and have attracted more than 5.000 clients. With their presence in Denmark, Sweden, Norway and Finland we think it is fair to say that they are the market leader in Scandinavia. Apsis also have a small operation in the Netherlands and have recently opened operations in Hong Kong.  Like many other vendors they also offer online survey capabilities.

Update September 2011: Apsis acquired the key assets from Zoomio’s bankruptcy estate.  While everyone in the market and everyone who would like to get their foot into the Email Marketing Software market are courting Zoomio’s some 400 customers in Denmark, we think that Apsis just might succeed in retaining at least 50% of Zoomio’s customers. A wild guestimate would suggest that this might add an additional yearly recurrent revenue to Apsis’ Danish operation of somewhere between DKK 4,0 mill to DKK 6,0 mill (€ 0,5 mill. to € 0,7 mill).

How are they unique? Price and presence makes Apsis unique. But in the Danish market that goes a long way.
Critical mass? As a regional player we believe Apsis has established critical mass and is well positioned for the future.
Reputation? Apsis seem to have a good reputation, but we haven’t (yet) founded enough evidence to suggest anything else.
Financial background according to Soliditet / Nordic Business View: 74,3% of Apsis is owned by Norwegian based venture capital company Norvestor. Sales of app. €10 mill. in 2009/10. Apsis Sweden generated a profit of around SEK 8 mill in 2008/2009. Apsis Sweden recorded a revenue of DKK 2,6 mill in 2009/2010 with a small profit.

Apsis is very much an entry level player. But given their broad distribution, we believe they can move up, down – or whichever way they please. It will be interesting to observe Apsis over the coming years.

Exact Target- biggest of the global top 5

Swedish based Core Relations has been selling and servicing Exact Target in the Nordic market since 2005. The reseller has grown slowly, but surely, while adding new trophy clients including KappAhl, Louis Poulsen, Saxo Bank and Stofa to name a few. The founding management team are amongst the most experienced email marketers in Scandinavia. They started  their career with aforementioned Globase in 2004/2005. To our knowledge they are the only reseller of Email Marketing technology that have managed to build a sustainable SOPP (Selling Other People’s Products) business. (ok, I made the SOPP acronym up inspired by the late shipping magnate Onassis’es OPM – Other People’s Money)

How are they unique? Core Relations offer Exact Target
Critical mass? We estimate that Core Relations have around 250 paying customers – add to that Exact Target’s some 8.000 customers. We expect them to be around for a while.
Reputation? Like Globase, Core Relations have done a good job of giving good customer support earning them a good reputation.
Financial background according to Soliditet / Nordic Business View: We do not have any figures for Exact Target at present. Core Relations had revenues of around € 1 million in 2009 and produced an small EBIT from their activities.

Core Relations have done their part in bringing Exact Target to the market. We think that Exact Target will eventually acquire them, fuel some working capability into them and give them wings to penetrate other near-home markets.

New and other Email Marketing Service providers in Denmark

This part discusses a few new email marketing service providers in Denmark or ESP’s from foreign lands that have recently entered the Danish market.

MailTalk (formerly known als MailMonitor)– a unique delivery model

Presenting itself as the complete Online Marketing and Communication Platform, we find that MailTalk’s chosen niche approach might just to turn out to be a smart move.
Choosing MailTalk customers like the Danish Ministry of Education and Mannaz certainly have shown their appreciation.  By offering strong integration to Microsoft Sharepoint and CRM, Sitecore CMS and Line of Business applications they allow their customers to host the solution in the customers own IT environment.

How are they unique? Strong IT development background and hosting flexibility
Critical mass? MailTalk is a relatively new solution – time will tell, but the good news is that the company has the finances to invest
Reputation? MailTalk is owned by the Danish IT company Delegate A/S. A Microsoft Gold Certified Partner which has a flawless reputation for delivering top-notch enterprise solutions.
Financial background according to Soliditet / Nordic Business View: Owner Delegate A/S do not disclose revenue numbers. But they managed to amass profits of nearly €1 million in 2010. We believe they have the financial muscle to become a serious contender in the Danish email marketing technology market.

MailTalk has attracted some pretty impressive clients in a short period of time. We think they will continue to do that and become the preferred choice with customers attracted by their niched approach.

Makenewsmail – new, entry level SaaS solution
New to the Danish market, this solution is developed by Make Websolutions AS, a Norwegian company. But we don’t know anyone using it, haven’t heard anyone talk about it so our assessment is quite superficial. Our take is that this company is going to take up the battle against email marketing technology providers who already have amassed 50, 60, 100.000 paying customers. We say good luck fighting that battle.

UbiVox – entry level email marketing
Established in 2003 UbiVox is the brain-child of a group of three internet entrepreneurs. We haven’t tested the solution, however they seem to position themselves in the category of entry level solutions targeting one-man-bands and small businesses. Financially speaking they are too young to have a record. But parent company Dining Philosophers ApS seem to have limited financial activity.

eBooster newsletter system
eBooster is yet another entry level system with pricing starting as low as DKK 99 (app. € 15) pr month. We’ll investigate just what eBooster is all about and what their end-users think about the service. But from the outskirts it does pretend to be yet another me-too solution trying to compete with the big, global guys. They do have a decent website, though. Financially speaking they didn’t have much activity in 2009.

RelationBuilder from Webconnect
We are not sure just how new this home-brewed solution is, however we will investigate and report back our findings for your perusal.

The foreigners – Email Marketing Service providers in Denmark or foreign ESP’s represented by resellers or distributors

Responsys – Cross channel marketing
Headquartered in San Bruno, Responsys established their Nordic office in Denmark. With trophy customers such as COOP Danmark, fittness dk, Pandora, Nordisk Film Biografer A/S and STARK they have attracted a good number of heavy user email marketers to their portfolio of end-users. We expect Responsys to add new customers at a slow pace and will be following them with great interest.

DreamMail by Epsilon Interactive – represented by Talefod
Talefod is an agency which has been reselling various email marketing technology tools for years.  Financially speaking Talefod is more solid than most, however it sure does seem as if there isn’t much activity going on.

The upper class – highly advanced and/or specialized email marketing technology vendors in Denmark

Agillic – customer lifecycle marketing automation expert
Agillic seems to be one of those software vendors with an impressive idea, but with a serious problem in making that idea work commercially speaking. We’ve had the pleasure of being presented for this multi-channel marketing automation solution a few years ago. And the solution does seem to address a whole range of very relevant issues that many companies in the telecommunication, banking, insurance, travel/hospitality etc. are struggling with.

But caution is advised. Agillic has lost nearly € 12 million since 2006 (DKK 84 mill). In fiscal year 2009 they lost DKK 17 mill. We understand that it costs money to bring a new technology to market. As a buyer, however, you want to ensure that there is financial backing, a solid plan to bring the company in the green and a certain distribution of the solution.

Peytz – newsletters for publishers
Peytz is a web agency whom also have developed an Email Marketing Solution. Over the years they have developed a strong position in the email marketing for publishers niche. Customers include the largest media & publishing houses in the country such as TV2, DK, Dagbladet Børsen and others.

Financially speaking Peytz is doing well over above average, however it would not be fair to even begin to guess about just how size-able the activities deriving from Peytz activities as an ESP are. Our guess is that actual recurrent software revenue makes up a relatively small portion of revenues.

Peytz might have a good chance to remain a contender in the longer run if they either remain within their niche of publishing and related industries and/or expand their presence outside of the Danish market space.