Pendo buys to further help SaaS product teams determine their next big feature update

Pendo acquires Receptive
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A firm called Pendo that helps companies determine which product features to deploy and assess how well they’re being adopted will announce its acquisition of on Tuesday, adding more qualitative capabilities for its customers.

Based in Raleigh, N.C., Pendo was founded in 2013 and has approximately 340 employees and more than 1,000 customers, including Adobe’s Marketo and Citrix. The company’s platform helps other software-as-a-service (SaaS) companies look within their own apps to see how they’re using a particular product, what features are offering value and personalizing the way they can onboard customers or guide them to new enhancements.

Although Pendo already offers some qualitative components to its core service, Receptive is almost entirely focused on gathering feedback across a set of customers to identify areas of opportunity in product development.

Pendo will spend the next few months integrating Receptive’s features into its own platform, though the two firms’ offerings will continue to be sold as standalone services, according to Pendo CMO Jake Sorofman. The purchase was driven by the sense that “product is the new marketing,” he said, given how reputations are built on things like user experience and the degree to which a SaaS tool helps customers achieve a business outcome.

“You used to be able to hide behind a false brand promise and get away with a mediocre product,” Sorofman told B2B News Network. “Now the product itself needs to match the brand promise or better. Customers want to try before they buy because they don’t take your word, they want to hear from your customers. It’s much easier to switch between alternatives. SaaS has made barriers to exit lower, which means you need to continuously renew loyalty and guide them to value.”

Besides simply figuring out new features, the combination of Pendo and Receptive will also help B2B firms connect with customers who might be willing act as an advocate for a particular product, while also improving the results of how SaaS companies measure themselves through things like Net Promoter Score (NPS) or Customer Effort Score (CES).

Product management teams have not had the budget or power within organizations to be as effective as they could be, Sorofman argued. That’s changing, however, especially as they get exposed to tools that can allow them to create a more one-to-one experience with customers from the moment they make a purchase. Pendo’s personalization features, for example, monitor what a user does and allows a company to target them with in-app messages or guides that raise awareness about new add-ons or short cuts to increase their satisfaction. All this helps ensure the effort that does into product development isn’t wasted, he adds.

“There is a virtually unlimited number of things you could do,” he said, “and often what feels like difficult or nearly impossible tradeoff decisions.”

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Shane Schick
Shane Schick is the Editor-in-Chief of B2B News Network. He is the former Editor-in-Chief of Marketing magazine and has also been Vice-President, Content & Community (Editor-in-Chief), at IT World Canada, a technology columnist with the Globe and Mail and was the founding editor of Shane has been recognized for journalistic excellence by the Canadian Advanced Technology Alliance and the Canadian Online Publishing Awards.