IBM To Buy Silverpop, Email And Marketing Automation Firm

IBMSilverIBM will acquire email and marketing automation vendor Silverpop, the companies said Thursday. Terms of the deal weren’t disclosed, but a story last month in the Atlanta Business Chronicle reported the value of a rumored acquisition at $270 million.

IBM, like Adobe and Oracle, has remained steady on the acquisitions front.

“They got massive marketing capabilities through Unica, analytics through Coremetrics and commerce with Sterling,” said Ray Wang, chairman and principal analyst at Constellation Research. Particularly, with its acquisition of Demandtec, IBM clinched pricing and optimization software for personalized promotions. “One of the huge trends is mass personalization at scale. You want to be able to get in there and say what content is relevant and deliver that content regardless of what channel [the consumer] is in.”

Silverpop enables this. While IBM has “an army of assets” in play for marketing, Wang said Silverpop brings the ability to effectively keep identities in context regardless of how an individual engages with a brand.

“The benefit of Silverpop is that it’s not just limited to B2B or B2C,” he added. “It’s been effective for customers across all types of companies.”

Update: Jay Henderson, strategy program director for IBM commerce and cross-channel marketing, tells AdExchanger IBM three years ago “identified the CMO as a new buyer of technology and embraced this idea that the line-of-business [beyond IT] would start buying technology.” Assembling a portfolio of such technologies to sell to marketers (such as its recent snap-up of mobile customer engagement platform Xtify) became a priority.

“Silverpop is really a natural complement to the rest of our portfolio,” Henderson said. He called Silverpop’s email marketing component a critical factor to reach B2C marketing scale. “They also had some exciting capabilities around B2B lead management and lead nurturing for longer sales cycle. It’s taking some of that B2B capability and applying it to B2C scenarios.”

IBM, some argue, was one of the early enterprise entrants into the whole marketing tech stack game.

“They were very early to hop on the notion of the CMO outspending IT,” said Russ Glass, cofounder and CEO of B2B marketing and ads platform Bizo. “They were very early in the acquisition cycles of Unica, Coremetrics, Sterling Commerce, so you can argue they had a leg up on everybody four or five years ago.”

Unfortunately, IBM put its weight into building out a strong services component – misjudging the market, according to Bizo. “[IBM] may have underestimated that marketers had no interest [in using] global services in a very high-price, high-margin way to deliver some of this customization, which is where I think Silverpop comes in,” he added. “It’s much more of a next-generation product for IBM.”

On Silverpop’s side, bolstering revenue analytics had been a core focus for the company.

Earlier in March it debuted Marketing Automation for Ecommerce, a first stab at developing vertical solutions “packages” tailored to industry-specific needs. One of the underpinnings of the product were automated, turnkey campaigns designed for marketer simplicity.

Although Henderson declined comment on integration plans for Silverpop due to the recency of the acquisition announcement, he balked when asked if this indicates IBM’s intends to build out its own so-called marketing cloud.

“I think there is a lot of hype around this,” he said. “Certainly, Silverpop is a 100% native SaaS application, so it definitely does give us additional capabilities for the cloud, but we don’t want to be pigeon-holed into a description of ‘marketing cloud.’ We have a broad spread of technologies that are both on premise and in the cloud and what we’re more after is choice in deployment.”

Bill Nussey, Silverpop’s CEO, told AdExchanger he feels IBM’s analytics are unparalleled “and the ability to offer that range of analytics to our customers” was a driving force in the deal decision. He also looks forward integrating with Xtify, which he described as “the perfect match for us. Had we not done this transaction, we would have looked to merge with Xtify independently…it was a particularly exciting company. That gives us the ability to have an active and engaged audience through mobile devices and SMS.”

He claimed Xtify will allow Silverpop to take location-based messaging “to an entirely new level.”

Nussey plans to continue on at IBM. Silverpop has an estimated 500 employees.

Enjoying this content?

Sign up to be an AdExchanger Member today and get unlimited access to articles like this, plus proprietary data and research, conference discounts, on-demand access to event content, and more!

Join Today!