May 7, 2012
On Wednesday, May 2, IBM announced its agreement to acquire analytics industry veteran Tealeaf. You can read the official press release here. The financial details of the transaction have not been disclosed, and the deal will conclude in Q3 2012, following a customary closing period. IBM anticipates that all Tealeaf staff will continue with the company. Tealeaf, a private company, was founded in 1999 as a spin-off of tech giant SAP. Tealeaf is best known for its interaction analysis — or session replay — software.
- Tealeaf moves into the big leagues. Tealeaf will now receive all of the standard benefits of joining IBM, mostly related to scale: continued investment in the product, the credibility of IBM's brand, instant distribution and support on a global basis, and the sense of mission and context that comes with integrating its customer experience management capabilities within IBM EMM and Smarter Commerce.
- IBM fills in another piece of the digital intelligence puzzle. By acquiring the largest and most developed provider in the niche interaction analysis category, IBM gets an established, patented, and highly productized interaction analysis offering. Tealeaf's ability to provide qualitative and contextual analysis of web and mobile interactions is highly complementary to IBM's existing analytics capabilities and has applications throughout the various phases of the Smarter Commerce offering. And it never hurts for IBM Global Services to expand its palette of internal tools.
- The EMM deals are piling up. Despite IBM's M&A expertise, the EMM group is now the product of four distinct acquisitions. Unifying four cultures, product lines, teams, and customer sets isn't an easy task for anyone. EMM is on the hook to develop a cohesive marketing platform that represents more than the simple sum of its parts. As IBM continues the integration process, change and transition will be a necessity. Change isn't bad, but surprises are. Clients must demand a very clear explanation of IBM's mid- and long-term plans for the EMM group, including leadership, client account management and support, and product road maps.
- Smarter Commerce dominates EMM's focus. IBM has heavily emphasized Smarter Commerce during its discussions of the Tealeaf transaction. Smarter Commerce is a broad, ambitious, and strategic initiative for IBM, and the EMM group is a major contributor to the offering. This focus should be well received by multi-channel retailers and eCommerce firms, but the EMM vision is less clear for other industries. Despite EMM's broad applicability, Smarter Commerce is dominating strategy, messaging, and development. To ensure a solid fit, firms need to make sure they fully understand EMM's capabilities and plans to support their industries and the degree to which Smarter Commerce is complimentary to their individual requirements.
- Reconciling diverse product architectures is not child's play. Tealeaf and Coremetrics make the most obvious pairing within EMM, and in fact, they enjoyed a partnership prior to the acquisition. A major benefit of this deal should be a truly seamless integration between the products, creating a more expansive digital analytics offering. To pull it off, IBM needs to reconcile the deployment methods of these products. Coremetrics is currently delivered as an on-demand offering, whereas Tealeaf is deployed behind the firewall as on-premise software. To be sure, this issue isn't insurmountable, and IBM certainly has the expertise to operate across environments. But it adds an extra layer of complexity to integrating, deploying, and managing the solution. Clients need to consider their deployment requirements and appetites for "hybrid" analytics solutions, as well as making sure they fully understand the technical details behind IBM's product integrations.