Cross-channel marketing software company Responsys has entered into an agreement to be bought by Oracle for a total sum of $1.5 billion, the companies announced Friday.
Responsys, which has a customer base of 450 companies, of which many are direct-to-consumer brands like LEGO, Nordstrom, Whole Foods and MetLife, will be integrated into the Oracle Marketing Cloud and Oracle Customer Experience Cloud, extending cross-platform marketing automation capabilities to Oracle’s customer service, sales, commerce and marketing products.
“Part of the reason why this is huge is because of Oracle’s purchase of Eloqua,” said Ray Wang, principal analyst and chairman, Constellation Research. “They got the B2B part of the marketing piece with Eloqua, but B2C marketing, which they’re getting with Responsys, is a whole different animal. It’s agile. It’s direct. When you take B2C marketing and tie it back to commerce, you get some really interesting synergies.”
Responsys, which experienced “tremendous” growth in the 20-30% range last quarter, according to Wang, enables marketers to target consumers through the various stages of the customer journey via digital campaigns, such as sending an email promotion or mobile message and then surfacing a display ad if a consumer hasn’t converted or, alternatively, “thank you” messaging if they did transact.
The Responsys acquisition points to the broader consolidation of CRM, email marketing and campaign-management technologies occurring in the marketing space. Salesforce.com’s acquisition of ExactTarget and Adobe’s purchase of Neolane are just a couple of examples.
Oracle, which bought content-marketing platform Compendium in October, is again attempting to bolster its Marketing Cloud following its purchase of marketing automation platform Eloqua last winter. Its success will hinge on its ability to integrate the disparate technology components.
“Relatively speaking, it’s easier to acquire than it is to integrate,” remarked Rebecca Lieb, a research analyst for Altimeter Group. “Integrating these companies, their technologies and processes and even their people takes time and costs money. … The acquisition is the tip of a very big iceberg. Just because they bought it doesn’t mean they’re ready to deploy it and doesn’t mean it works with Eloqua yet.”
Wang agreed and added that employee retention is a key challenge for Oracle now. Large software companies are mimicking large pharmas, “where they’re buying the innovation pipeline, but they’re not always able to retain the folks there,” he said. “A lot of the Vitrue [a social media marketing company Oracle acquired in 2012] people are gone. A lot of the Eloqua people have left.”
As for what this domino effect of marketing-automation and campaign-management acquisitions means to the ad and marketing industries?
“We’re watching these companies that are known for things that are really kind of tangential to marketing … really [moving] aggressively into the marketing space with acquisitions like Eloqua, Responsys and Compendium. It looks like they are really gearing up to compete, even possibly, with the ad stacks,” Lieb noted.