One year ago, eBay put its enterprise marketing assets up for sale, and its commerce platform Magento was taken private again. Now Magento is making an acquisition of its own.
The company revealed on Monday it had acquired RJMetrics, a Philadelphia-based advanced analytics startup. Financial terms of the deal were not announced, but RJ Metrics employs about 75.
Many mid-range and enterprise retail brands, including Christian Louboutin and Jack Daniel’s, use Magento to build web stores. But Magento had an important hole to fill: analyzing the digital impact of a brand’s physical presence and vice versa, said Magento CEO Mark Lavelle.
That’s where RJMetrics comes in.
As digital platforms like Pinterest and Instagram add commerce capabilities, that introduces a need for an analytic function that weighs brand strategy and health against transactional and performance data, said Lavelle, who co-founded payment startup BillMeLater, also acquired by eBay in 2008.
And large consumer-packaged goods and pharma clients are pushing to digitize as they seek more direct-to-consumer connections. That’s partially driven by an evolution of customer roles. Magento used to service VPs of ecommerce or even IT, but it now assists many heads of digital.
“They’re given this mandate to digitize the consumer experience and it has a lot to do with the Amazon effect,” he said. “If you’re a retailer or manufacturer selling wholesale goods, your challenge is to create a differentiated experience from Amazon, and you’re having to invest more and more in your digital and in-store experience.”
Customers historically used Magento to build websites and measure page views and conversions based on a simple integration with Google Analytics. Today, requests are much more omnichannel in nature and include elements like how many users checked out online or chose a ship-to-store option.
Marketers also wish to factor price and availability of inventory into user acquisition campaigns – a challenge when retailers’ sales and merchandising systems didn’t talk to email or marketing automation platforms.
RJMetrics integrates with a range of solutions spanning ads (Google AdWords, Facebook and AdRoll), payments (Stripe) and CRM systems (Salesforce), which Lavelle believes will help its historically commerce-focused platform make inroads into analyzing paid media.
“This gets us into analyzing paid usage to CRM, order history, site metrics and outside social signals,” he said. “The ability to link inventory from a store to the proximity of a consumer based on digital [data] is probably one of the biggest [requirements] to make omnichannel real.”
Magento’s bid for RJMetrics is the latest in a flurry of commerce deal activity. Oracle acquired NetSuite for a whopping $9.3 billion late last week, but only after Salesforce spent $2.8 billion on Magento competitor Demandware.
