With new funding of $600 million, Contentsquare aims to humanize digital interactions

The pandemic-induced digitization of everything has been well documented, as businesses have had to shut down and find another way to interact with customers through digital initiatives.

Before the pandemic, digital transformation was something most businesses only thought about. Post-pandemic, it’s something that most businesses rely on to transact and provide services and everything else in the customer lifecycle.

One of the challenges of the hard shift to digital is the risk of dehumanizing the customer experience. Websites often treat all customers the same or use very basic demographics to personalize content, but the reality is that people are all different and have unique needs and wants. The more a company can create a tailored experience, the higher its brand loyalty will be.

Digital Experience Analytics Provider Content Square focused on making the digital world more human. Over the past year, the company has rolled out a number of key new features, including artificial intelligence capabilities and a cookieless solution, acquired two companies, opened a number of new offices around the world, and hired 700 people, with a current workforce of 1,500 people.

Contentsquare recently announced its next investment cycle for growthwhich includes a $400 million Series F funding round and a $200 million debt financing line, led by Sixth Street, a private equity firm that has made investments in companies such as Airbnb, Spotify, SnapLogic, Wind Power and sports teams. Real Madrid and San Antonio Spurs.

In May 2021, the company closed a $500 million Series E round, led by SoftBank, a year after its $190 million Series D, led by BlackRock. This brings total funding to $1.4 billion across the six rounds, including debt.

One of the notable aspects of the round is Contentsquare’s valuation of $5.6 billion, doubling from a year ago, a testament to the company’s growth and significant market needs and opportunities. My surprise has less to do with Contentsquare and more to do with the overall macro and valuation of listed companies. Financial markets have slashed the market capitalization of many high-flying companies linked to the pandemic by up to 90%, while that of Contentsquare has doubled.

This highlights several key points. The first is that the intense corporate focus on improving digital interactions is not a pandemic bubble, but rather something that will create long-term market leadership for companies that do it well. Although investors have bailed out many companies focused on “working from home”, they seem to be increasing their investments in companies that have a direct impact on the customer experience.

This also validates Contentsquare’s leadership in this market. Digital experience analytics is a relatively new market and there is no de facto leader like Salesforce Inc. in customer relationship management. Contentsquare has used its previous cycles to quickly add new features both organic and inorganic to create an experience platform that not only collects and analyzes data, but also delivers actionable insights.

“In today’s digital environment, it’s not enough to judge success solely on traditional KPIs, like clicks or conversions,” says Niki Hall, Chief Marketing Officer of Contentsquare. “Today, understanding intent, frustrations, pleasure – all of this matters and creates value for the brand and customers. Uncovering insights that represent the end-to-end customer experience enables brands to take meaningful decisions and take intentional action, improve in real time, and, if they use Contentsquare, do it all while maintaining the highest levels of privacy and trust.

We’re still in the early stages of this technology, and I imagine Contentsquare will use much of the investment cycle to rapidly grow its customer base and continue to make significant headway in the $34 billion total addressable market. It currently has over 1,000 corporate clients, but that’s still a small slice of the overall pie. At present, winning business is more of a land grab and it requires investment in marketing, sales and a more local presence on a global scale.

I also expect the company to continue to develop the capabilities of its platform to become a true one-stop-shop. The company has a five-product strategy for its platform that includes analytics to analyze customer journey and content, mobile app optimization, finding and fixing surface errors and load times, merchandising for product and pricing analysis, and recommendations for benchmarking and rating. All of these products can help companies create a unique experience for each person.

Digital is certainly the preferred path for most customers, but brands need to be careful not to over-digitalize experiences where consumers feel their needs aren’t being met. Contentsquare has done an excellent job of meeting the needs of its customers. Growth and funding are proof of that. With this cycle, I expect to see the company stepping on the gas and accelerating what is possible with digital experiences.

Zeus Kerravala is a principal analyst at ZK Research, a division of Kerravala Consulting. He wrote this article for SiliconANGLE.

Image: Contentsquare

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