In March 2012, cloud operator ExactTarget (ET) pulled off a big deal — its public offering of $19 per share.

Well, following a roller-coaster ride that saw ET shares spike by more than 30% before going rangebound in the low $20s, ET has made another big move: a $2.5 billion sellout to Salesforce.com (CRM) that values the stock at a juicy $33.75 per share.

And frankly, I think we’re going to see more of the same in the cloud sector.

The cloud is a huge transformation of the traditional business software market. The technology essentially makes it much easier and cost-effective to implement and manage, while also offering other benefits like real-time access to data and analytics.

All in all, companies can wring a lot of value from cloud computing.

As a result, the market potential is enormous. According to IDC, the market for cloud software is expected to surge from $22.9 billion in 2011 to $67.3 billion by 2016. That’s an annual growth rate of more than 30% — five times the ramp for the overall software market.

However, building a cloud company from scratch is no easy feat, requiring a long time to build the proper infrastructure, design effective workflows and acquire customers. Thus, it often makes more sense for traditional software vendors to enter the cloud or boost their own offerings through dealmaking. A spate of players that have done so (and can be expected to do more down the line) include Oracle (ORCL), SAP (SAP), IBM (IBM) and CA (CA), which all can plunk down big dollars.

Some of the most interesting targets — such as Workday (WDAY) and ServiceNow (NOW) — also are the least likely to be sold thanks to sky-high valuations. However, a few smaller operators look like potential M&A fodder, including …

Millennial Media

Millennial Media (MM) operates the No. 2 mobile ad network in the U.S. The platform powers more than 42,000 apps and delivers rich ads across over 7,500 mobile devices.

Through Millennial Media, customers can build sophisticated profiles on customers that can greatly improve the results for ad campaigns. Targeting can be done with factors including a user’s interests and locations.

The opportunity is massive, with Gartner forecasting that the market for mobile advertising will grow from $3.8 billion in 2012 to $13.5 billion in 2015. MM’s own expansion has been impressive, too, with revenues soaring in its latest quarter by 50% year-over-year to $49.4 million quarter. It also improved its adjusted EBITDA, with losses falling from $2.4 million to $800,000 in the same period.

And yet, MM’s stock performance has been horrendous. Shares are off 33% year-to-date to $8.48 — roughly a third off its $13 IPO pricing, and 65% off its high-water mark around $23.50, which Millennial Media reached in its first day of trading.

As the company competes against big fish such as Apple (AAPL) and Google (GOOG), MM’s best option to avoid losing ground to these fierce rivals might just be selling out.

Demandware

Demandware (DWRE), which develops enterprise-class cloud commerce software, has a platform that hosts more than 150 retail brands and 625 sites around the globe.

DWRE makes money based on a “shared success” model, taking a cut from the growth in its customers’ revenues. This has resulted in steady growth for DWRE, including a 27% year-over-year bump in Q1 revenues to $20.5 million.

However, losses have lingered as the company continues to invest heavily in its business. In the same period, the loss from operations came to $7.3 million, much deeper in the red than its $1.8 million loss in the year-ago period.

The long-term prospects look bright, though. E-commerce is a megatrend — Forrester expects the global market to increase by about 10% a year, reaching $327 billion by 2016 — and traditional companies will most likely outsource this to top providers like Demandware.

But for companies like Oracle or SAP, which have massive customer bases, acquiring DWRE could provide a huge boost of growth thanks to cross-selling opportunities.

Bazaarvoice

Bazaarvoice (BV) is similar to ExactTarget, operating a platform that helps customers improve their marketing efforts, especially on social channels like Twitter and Facebook (FB).

The company has put together a solid customer base including mega-brands such as Best Buy (BBY), General Electric (GE), Home Depot (HD) and Samsung (SSNLF). What’s more, BV has been able to keep up the growth momentum. In the latest quarter, BV’s revenues climbed 55% year-over-year to $42.7 million, though its operational loss widened from $3 million to $5.5 million.

Bazaarvoice’s continued financial issues have worried Wall Street, and investors have clipped BV shares by more than half in the past year. Salesforce’s deal for ET should only add to BV’s problems by intensifying the competition.

Considering being an independent public company hasn’t worked out too well, Bazaarvoice might be much better off finding a bigger partner and selling out.

Tom Taulli runs the InvestorPlace blog IPO Playbook. He is also the author of High-Profit IPO Strategies, All About Commodities and All About Short Selling. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities.