Put aside the valuation of WorkDay shares for the purposes of this market research note.
Workday’s 2014 Net spending Intentions score has reached an all-time high in our work since we began surveying upon them in June 2012. This represents a significant acceleration versus one year ago and even just 5-6 months ago. A bit more about that previous statement. While Workday has had solid adoption numbers and solid Net scores previously in our work, it has not had scores commensurate to what most would anticipate to see in our work. We believe this is due to two factors: (1) its customers number in the hundreds - not in thousands, and (2) those customers have not been as big in organization size as our sample composition is. This is why the data inflecting so significantly stands out to us, because it tells us that they’re bringing on bigger customers that are more in line with our sample’s mix. More evidence of this can be found in the fact that Workday was the 11th most cited vendor in the Hosted Software subgroup just 6 months ago and it’s now the 5th most cited name in the 23-vendor space. Additionally, one out of every 4.5 Workday respondents indicated that they’re a new vendor Adoption in 2014 for their organizations - 100% of these Adopters are with Large organizations.
However, one must keep in mind that while our data for 2H13 was quite up versus 2H12, the Net score did not significantly accelerate into 2H13 from the January 2013 work and the Net score actually decelerated a bit into Q4CY13 in our September work for 2H13 versus the data originally captured in July for 2H13. This is by no means damning, but with a big expectation name such as this, we’d obviously prefer to have no signs of Net score deceleration. We feel the 2H13 vs. 2H12 comparison is more meaningful than the SEP13 vs. JUL13 comparison and again, the 2H13/2H12 acceleration was good. Additionally, the Net score deceleration we captured in September versus July was primarily due to receiving new citations (Workday respondents) that indicated Flat - it was not caused by repeat respondents reversing course from an Increase or Flat response in July to a Flat or Decrease response in September.
As many of you have already heard from us, we feel this data is quite reminiscent of Splunk's data from late 2012 into 2013; modest decel into Q4CY12, followed by skyrocketing 2013 data recorded in late December '12/early January '13 - especially from large, big wallet organizations.
Unfortunately, we cannot produce regression results as of yet, as we have only tracked Workday since June 2012. With Q4CY13 yet to be reported, we cannot map our 2013 or 2H13 work versus full year 2013 or 2H13 actual revenues. This will no longer be the case after next week’s report.
Bottomline: The data is very positive for 2014 and it’s quite obviously a vendor still winning and accelerating further among the biggest buyers in the world. So yeah, we like it.
- Best ever recorded Net score of 66% (n=32), previous best was March 2013 with a 26%.
- Best ever recorded Adoption rates of 22%.
- All respondents that indicated Adoption are Large organizations.
Best ever recorded Net score of 67% among Large Enterprises (n=24).
- Adoption rate of 29% among Large Enterprise respondents.
Net score of 69% among Holy Trinity respondents (n=13, North American or EMEA-based Large Organizations in either the Financials/Insurance, Government or Healthcare/Pharma verticals).
- This is the 2nd best 2014 Net score among Holy Trinity respondents in the 23-vendor Hosted Software subgroup lagging only Salesforce (2014 Net=81%, n=27).
Net score of 50% among the “BIG 61” respondents (n=8, Organizations with greater than 50,000 employees that have repeatedly taken the survey). Net score of 78% among Financials/Insurance respondents (n=9).
- This represents a +58 point improvement CY14/CY13 and is the best score in the space - tied with Salesforce.