As I’ve mentioned in the past, the customer experience management space is ripe for M&A activity. So it wasn’t a big surprise last week when Confirmit announced that it had acquired CustomerSat from MarketTools. For those of you who don’t know these firms, they both provide what I call Customer Insight and Action (CIA) platforms that are sometimes referred to as Enterprise Feedback Management or EFM. These vendors provide tools and capabilities for organizations to manage their voice of the customer (VoC) programs.
I spoke with Confirmit CEO Henning Hansen and members of his management team about this move. Not surprisingly, they were excited about the opportunities for both companies. CustomerSat brings 120 or so enterprise customers and a strong services team. The execs also spoke about how CustomerSat customers will get access to new capabilities such as Confirmit’s mobile features from its previous acquisition of Techneos. Here are some other tidbits from my discussion:
- Confirmit is committed to supporting both platforms. Hansen told me that they “will not lose one customer because of shutting off support.” Having said that, the company has not yet defined the combined product roadmap that (from my point of view) must eventually merge the platforms.
- CustomerSat’s services capabilities will help Confirmit accelerate its plans to add more services around its CIA technology platform.
- Confirmit will be able to incorporate parts of CustomerSat’s reporting and dashboard capabilities since it is better suited for access by untrained, non-analysts.
- The companies will not immediately combine the two sales forces, but will incent the two groups to help each other with joint customers and opportunities. I expect that they will combine the salesforce by the beginning of 2013.
- I suggested that the company should consider rebranding itself from Confirmit to CustomerSat. Hansen said that they were open to looking at all possibilities as they complete the post-acquisition plans.
My take: Although Confirmit did not share any of the financial details of this deal, it appears to be an excellent move. Confirmit has had a strong foothold in Europe and with market research companies that use its platforms as part of their offerings. CustomerSat provides the company with significant scale in the US and a stronger base of enterprise customers. It also needed to round out its platform with more services, which was a strong area for CustomerSat.
This is also an excellent move for CustomerSat and its customers. While CustomerSat is one of the most tenured CIA vendors and has had a strong offering, it was somewhat orphaned when TPG Growth purchased MarketTools to combine other pieces of the company with SurveyMonkey. This move should provide more stability for CustomerSat customers and a stronger long-term roadmap. Having said that, both CustomerSat and Confirmit customers will likely have to deal with some migration issues in the future when Confirmit merges the platforms. I would expect the company to invest heavily in minimizing the impact of these transitions.
As VoC programs continue to expand and mature (see Temkin Group report: Prepare For Next Generation Voice of the Customer Programs), we expect to see demand continue to grow for CIA platforms. These vendors will need to increasingly build out their social media, analytics and mobile capabilities while adding services to support more advanced VoC programs within large enterprises.
I expect to see additional acquisitions in this market as the CIA vendors creep into other markets such as CRM, analytics, market research, and business intelligence.
The bottom line: The CIA market will continue to evolve