Zoom just bought Five9 for 14.7 billion dollars.
Know what else they could have bought for that amount of money?
The Dallas Cowboys. Twice… And they still would have had some cash left over to buy a private island along with a private jet. Yet, while more people around the globe know or at least have heard of the Dallas Cowboys – the Five9 brand recognition is relatively limited to their niche and SaaS geeks, like yours truly, who reads SaaS earnings reports for fun.
But let’s talk about the reason this acquisition is quite interesting.
Let’s set the stage.
Both Zoom and Five9 have been on fire over the last couple of years. Investors have responded as such and both companies have seen ridiculous returns since their original IPO dates:
The pandemic fundamentally changed the world.
It’s still changing the world.
But it also changed Zoom as an organization and accelerated its growth substantially. It went from a solution being used by many modern organizations that embrace remote work to something that was being used to host baby showers, birthdays and even learn at school.
This is a snapshot via SimilarWeb of what Zoom’s traffic looked like pre and post pandemic:
In January 2020, they were generating an impressive 91-95M visits a month…
Today, it’s estimated that Zoom is generating more than 2.1B visits every single month.
That’s a lot of traffic.
At its peak, there were more visits to Zoom’s website per month than the entire population of the US and India combined. Game-changing growth…
But this traffic is somewhat on the decline as more people return to work and classrooms open back up for students. Don’t get me wrong. I’m LONG on remote work.
Our entire team is 100% remote. But I acknowledge the fact that while this shift to remote has shaped a lot of companies — some companies just aren’t going to embrace the remote culture.
So… Zoom is taking a bit of a dip.
How do you bounce back?
You acknowledge the fact that you have captured a ton of market value in your existing niche (video conferencing) to the point where you now must sustain your position as the leader. All while also staying hungry and looking for opportunities that are in similar lanes as yours but present new opportunities and new growth. And that’s where the acquisition of Five9 comes in…
Five9 is a contact center as a service solution that saw its revenue climb 33% to $435 million last year. The software allows call center agents to operate all over the globe and from anywhere in the world. Five9 works with top brands like UnderArmour, Teladoc, Lululemon, a handful of Universities and more. Some of their competitors include companies like: NICE inContact, Genesys, Talkdesk and Cisco. You might be familiar with a few of them but again… These companies aren’t exactly the Dallas Cowboys of SaaS.
According to Gartner + Forrester, the leaders in the cloud contact enter space – Five9 really competes mostly with Genesys and NICE InContact.
Here are a few data points to keep in mind as we look at this situation from a content perspective:
Across the board, it looks like Genesys is doing the best job at overall SEO but Five9 has certainly done a good job at generating the most valuable keywords and driving the most significant amount of total traffic. NICE is playing a bit of catch-up against its two biggest competitors while Genesys and Five9 compete for industry supremacy.
What’s even more interesting here is this:
According to both Gartner & Forrester NICE has the better product…
NICE is the product that is placed in the highest right-hand corner of the industry map yet it’s capturing the least amount of traction from SEO (all things considered).
So, why do I want to point this out?
Because while the team at Five9 was acquired for nearly 15 billion dollars…
The analysts wouldn’t say that they’re the best product on the market. But when you look at their strength as it relates to marketing and establishing a diversified stream of traffic. The team at Five9 has thrived.
It’s as if sometimes… just sometimes… Your marketing engine is just as (if not more) important than the actual product that you’ve created.
That’s right.
Your company is just like the Dallas Cowboys. It doesn’t actually have to be a great team to be worth a lot… It just needs great marketing.
I’ll leave you with this:
“The best product doesn’t always win. The one everyone uses wins” – Andrew Bosworth, Facebook
Have an awesome week.
PS: I’m hosting a free webinar next week! It’s the same talk I gave at Mozcon (here’s what people thought) — Register today and I’ll be sure to send you everything you need to get your hands on it.
