Small Businesses Warming Up to Social Media Marketing; Constant Contact Stock Aiming for $25

Constant Contact (NASDAQ:CTCT) is a major player in the online marketing business. It generates almost all of its revenues from content marketing, which is comprised of email marketing, event marketing, online survey tools as well as social media marketing. It competes with Eventbrite, iContact and Surveymonkey in that space as well as Salesforce.com (NASDAQ:CRM) and Microsoft (NASDAQ:MSFT) in the customer relationship management market. We currently have a $25 Trefis price estimate for Constant Contact, which stands nearly 15% above its current market price.

Check out our complete coverage of Constant Contact

Social Media Marketing on the Rise; Constant Contact Stands to Benefit

It recently launched social media marketing solutions for small businesses, which enables them to market and advertise their products and monitor their campaigns on social networking portals like Facebook, Twitter and LinkedIn. In a recent survey conducted by them, it was revealed that small businesses are now warming up to the idea of social media marketing, and finding social networking sites like Twitter, Facebook and LinkedIn an effective way to market their products online. ^[1] Around 81% of the businesses surveyed reported using social media to market their products, with most of them using Facebook and Twitter.

Constant Contact recently reported a 20% increase in revenues in Q3 2011, and continues to add new customers at a steady rate. We expect it to have nearly 800,000 customers by the end of the forecast period. We expect social media marketing will drive a large part of its content marketing business in the coming years.

Understand How a Company’s Products Impact its Stock Price at Trefis

1. Constant Contact Survey Reveals Significant Shift in Small Businesses’ Willingness to Use Social Media Marketing, MarketWatch [↩]