May 4th, 2012 by Leonard Klie

IBM this week announced plans to purchase Tealeaf Technology, a provider of customer experience analytics software that helps organizations access and make sense of information related to consumer Web experiences.  It’s the third CRM-related acquisition by Big Blue in as many weeks, following its other acquisitions of Vivisimo, a provider of enterprise search technology, and Varicent, a sales data analytics company.

The Tealeaf acquisition is part of IBM’s effort to build up its Smarter Commerce initiative. Tealeaf’s products will be integrated into IBM’s Enterprise Marketing and Management Group, which includes assets it previously acquired in deals to buy Coremetrics, Unica, and DemandTec, among others.

IBM is investing heavily in commerce software as a whole, and it’s no wonder given that the company has reportedly identified the market for its Smarter Commerce initiative as a $20 billion market opportunity. Apparently there’s big money to be made in helping companies identify and respond to shifting customer buying patterns.

It’s also becoming evident that IBM is betting big on Big Data and the analytics to make sense of it all. A recent New York Times article points out Big Blue has spent some $14 billion in the past five years purchasing analytics companies.

I suspect this is just the beginning, given the company’s penchant for acquisitions and its deep pockets. According to the company’s own financial reports, it spent $1.5 billion to acquire five companies in its last fiscal quarter. It just might have some more to spend.

IBM’s acquisition of Tealeaf brings to fore an important point about effectively communicating and leveraging Tealeaf capabilities with end-users. Companies need customer-centric initiatives that are geared towards aligning the overall operations, organizational structure, and job-roles with the customer’s vision of the brand. The customer needs to be at the center of all decisions. The objective is to map detailed customer big data, affinity, and customer buying/referral-related preferences analysis to all parts of the organization.
The goal of all internal and external business process and technology changes that are being implemented is to be more relevant to customer needs and create personalized experiences in stores and other sales channels. From a business strategy standpoint, Best-in-Class companies are striving to establish organization-wide customer-centric capabilities for creating ‘true customer champions’ to fulfill customer-related and day-to-day job responsibilities all across the organization starting at the CEO-level. The second and most important pillar of this strategy is associated with augmenting customer-data based business processes and associated customer-data insights and customer intelligence solutions. Robust customer data, segmentation, and a deep focus on customer analytics are the varied elements of this strategy. This is where Tealeaf capabilities will be critical for driving actionable insights and results.
Capturing customer’s mindshare and buying senses relates to all relevant customer buying affinity data and insights shared seamlessly across procurement, supply chain, merchandising, marketing processes etc. It is essential to cover all channels including store clusters, price bands, and customer segmentation types. As a result, omni-channel customer recency, frequency, and monetary (RFM) can become a sustainable exercise.

Comment by Sahir Anand — May 7, 2012 @ 3:09 pm

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