When I read articles like today's WSJ article on mutual funds exiting high tech startups and triangulate the content with Forrester client interactions over the last 12 to 18 months (and some rumors) I am now becoming convinced that there will be some Business Intelligence (BI) and analytics vendor shake ups in 2016. Even though according to our research enterprises are still only leveraging 20%-40% of their entire universe of data for insights and decisions, and 50%-80% of all BI/analytics apps are still done in spreadsheets, the market is over saturated with vendors. Just take a look at the 50+ vendors we track in our BI Vendor Landscape. IMHO we are nearing a saturating point where the buy side of the market cannot sustain so many sellers. Indeed we are already seeing a trend where large enterprises, which a couple of years ago had 10+ different BI platforms, today usually only deploy somewhere between 3 and 5. And, in case you missed it, we already saw what is surely to be a much bigger trend of BI/analytics M&A - SAP acquiring mobile BI vendor Roambi. Start hedging your BI vendor bets!
Today, Oracle announced that it will acquire Eloqua, a marketing automation firm. Oracle positions the deal as a comprehensive customer experience cloud that enables business to create an integrated, end-to-end process of marketing, sales, service, and support. I look forward to insight from my colleague Lori Wizdo on what the Oracle-Eloqua deal means for a marketing and sales alignment.
I think the deal has larger ramifications for the future of all customer relationship marketers and marketing vendors. Here’s my take on the deal:
Cannes this year is hosting more and more evidence of the disappearance of lines between “digital” and “advertising”: A mobile category was launched; the new Branded Content and Entertainment category includes subcategories such as “best use or integration of user generated content”; Twitter co-founder Jack Dorsey was named Media Person of the Year and . . .
. . . WPP used the international advertising festival to announce it is acquiring digital agency AKQA and incorporating it as a separate network within WPP.
AKQA is a great pickup for WPP. It's not only one of the biggest indies left but one of the best at blending creative and technology skills in one organization — a mix that doesn’t always live together easily.
It also fills a hole for WPP. AKQA aspires to a category of agencies I call “brand transformers” that are about more than communications and look to leverage digital capabilities to help clients enter new adjacent product and service areas.
Very interesting that it will be a standalone brand and not folded into one of WPP’s existing networks. Digital agencies VML and Blast Radius bring similar capabilities but are locked in the Y&R network; WPP gains flexibility by having AKQA “at large” in its holdings. In addition, AKQA is a little too big to fold into another network easily, but will need to build heft quickly if it wants to remain separate. Otherwise, in a couple of years, WPP will merge it with other assets.
I think it’s likely Interpublic and Omnicom will react. WPP clearly sees digital as essential to its future. This acquisition definitely puts some distance between WPP and Omnicom, which had been pretty close, and Interpublic, which has a couple of strong assets but doesn’t have the strategic focus that WPP and Publicis do.
Last week saw news that yet another top GRC software vendor has been acquired, following in the footsteps of Paisley, Archer, OpenPages, among others. BWise has always been an impressive vendor in the GRC space, so first off I think congratulations are in order for both parties.
That said, if you didn’t foresee NASDAQ getting into the GRC software space coming, don’t beat yourself up… after seeing the large technology vendors and content providers enter the space over the past 3 years, this wasn’t an obvious move. But looking a little deeper, NASDAQ’s move makes sense for a couple reasons:
- NASDAQ’s target market cares about GRC. NASDAQ lists its target roles as marketing/corporate communications, board and corporate secretary, investor relations, and corporate finance. All of these roles have a vested interest in better controls, stronger risk management practices, and improved corporate governance.
- BWise has always focused on the “G” of GRC. More than any other of the top GRC software vendors, BWise targeted governance professionals with capabilities such as entity management.
- There are immediate integration possibilities. Among NASDAQ’s corporate solutions are products for board management, whistleblower reporting, and XBRL filing. BWise has a host of capabilities (issue management, process management, policy management, reporting, etc.) that could quickly add value to implementations of those products.
But, as always with a deal like this, both parties will have to show the market how they will address some key questions:
Extending core offerings through marketing technology. eCircle joins Teradata’s two prior investments in marketing technology: Aprimo Marketing Studio (AMS) and Aprimo Relationship Manager (ARM), which were separately acquired in previous years. Teradata confirmed that it will position the eCircle product within its standalone Aprimo division.
Complementing data warehousing with big data analytics. Through the acquisition of Aster Data, Teradata moved to beef up its presence in analytics for large-scale data sets, such as log files, clickstream, and sensor data. eCircle’s platform is built on a similar (Hadoop-based) platform, allowing marketers to co-mingle and analyze customer records, campaign data, online behavioral interactions, and more.
The proposed acquisitions of SuccessFactors by SAP, and of Emptoris by IBM got me thinking about the impact on buyers of market consolidation, in respect of the difference between dealing with independent specialists versus technology giants selling a large portfolio of products and services. Sourcing professionals talk about wanting “one throat to choke,” but personally I’ve never met one with hands big enough to get round the neck of a huge vendor such as IBM or Oracle. Moreover, many of the giants organize their sales teams by product line, to ensure they fully understand the product they are selling, rather than giving customers one account manager for the whole portfolio who may not understand any of it in sufficient depth. Our clients complain about having to deal with just as many reps as before the acquisitions. They all now have the same logo on their business card, but can’t fix problems outside their area, nor negotiate based on the complete relationship. It seems that buyers end up like Hercules, wrestling either with a Nemean lion or with a Lernaean hydra.
The acquirers' press releases tend to take it for granted that customers will be better off with the one-stop shop. Bill McDermott, co-CEO of SAP, said, “Together, SAP and SuccessFactors will create tremendous business value for customers.” While Lars Dalgaard, founder and CEO of SuccessFactors, talks about “expanding relationships with SAP’s 176,000 customers.” Craig Hayman, general manager of industry solutions at IBM, said, “Adding Emptoris strengthens the comprehensive capabilities we deliver and enables IBM to meet the specific needs of chief procurement officers."
It’s a couple of days after Google announced its intentions to jump headfirst into the hardware business. By now everyone — including my colleagues Charles Golvin and John McCarthy — have expressed their thoughts about what this means for Apple, Microsoft, RIM, and all of the Android-based smartphone manufacturers. This is not another one of those blog posts.
What I really want to highlight is something more profound, and more relevant to all of you out there who might classify your day job as “product strategy.” To you, the Google/Moto deal is just one signal — however faint — coming through the static noise of today’s M&As, IPOs, and new product launches. But if you tune in and listen carefully, two things become crystal clear:
The lines between entire industries are blurring. Google — and some of the other firms I mentioned above — are just high profile examples of companies that are diversifying their product portfolio, and the very industries in which they play. There are several instances of this over the past "digital decade." What's different now is the increased frequency of the occurrences.