We recall a compelling presentation by Eric Groves — once SVP at Constant Contact and now the Co-Founder and CEO of Alignable — when he talked about the incredible disruption of ConstantContact by Mailchimp. The presentation was a crash course in how to totally disrupt a market leader — ConstantContact — in the span of a couple of quarters.
We bring this up as we learn of Mailchimp’s march forward from email and newsletter company to what it now describes itself as, “the All-In-One integrated marketing platform for small businesses, to grow your business on your terms.” Mailchimp can credibly make this claim now that it is offering online stores and appointment booking to its core SMB customer segment.
Late to the Party?
We wonder if Mailchimp isn’t a bit late in this product expansion. But before we explain why, let’s go over a bit of company background.
Mailchimp is a 20-year-old, privately-owned company pushing upwards of a billion dollars of topline revenue. The following was written about the company back in pre-pandemic 2018. “With $600 million in revenue, Mailchimp is in the black and has more than doubled its estimated valuation to $4.2 billion in the last two years, giving [Ben] Chestnut, 44, and [Dan] Kurzius, 46, its sole owners, stakes worth $2.1 billion each.” With the pandemic, we’re pretty certain the company became more relied upon by its customers. At least among those able to ride it out.
Image Credit: Mailchimp
So now the company is pushing forward with online stores. This puts them in competition with $123 billion market cap behemoth Shopify and its countless competitors. And it’s adding appointment booking. Something offered by literally every small business platform. So we have to ask, are they too late to the game?
The new services will be included in the company’s “Websites and Commerce” plans. These start with a free tier and include additional features and benefits for paid tiers. Each plan enables small business users to build sites with an unlimited number of pages and includes SEO tools and integration with Google Analytics. The stores offering lets business owners build their product catalogs and manage their orders, taxes, and shipping configurations.
Apparently, 40% of the company’s 14 million customers (it’s unclear how many of these are paying) are already in the commerce space. And apparently, they’ve been asking Mailchimp for a native commerce solution. According to the company, eCommerce revenues rose 61% between 2019 and 2020. We can only imagine that growth further accelerated in 2020 and 2021.
Not Abandoning Email
Here’s what CEO and co-founder Ben Chestnut wrote about in the announcement. “Rest assured, we’re not abandoning our smart marketing solutions. In fact, our goal is still to have the best email marketing in the world. We know our customers and partners demand consistency and continuity as much as they demand new features and functionality, so we’re refining and nurturing existing tools, too. We continue to work on making the process of designing emails as easy as possible. And in a few months, we’re adding new beautiful email templates.”
So Mailchimp not running away from its core business. It is simply adding to its product suite. But lots of other small business SaaS platforms have been heading in this direction for some time. We think it is a bit ironic that from where we sit, Mailchimp, once a disruptor — just ask the folks over at Constant Contact — is now playing catchup. This doesn’t mean they won’t be equally successful in offering online stores and appointment booking. But playing catchup is wildly different from playing disruptor.