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1 / 5 / 2011

Step 2 in The Enterprise Marketing Management Landgrab: Teradata takes Aprimo

 

In those sleepy weeks while everyone is busy with the holidays, something big in EMM snuck in under the 2010 wire: On December 22, 2010 Teradata announced thru a press release their intention to acquire Aprimo for $525M.  That’s $45M more than IBM paid for Unica for those keeping score.  While it’s easy to say this is a reactionary move to IBM’s pending acquisition of Unica…I don’t think that’s correct.  The market has been in play all year, with a number of background discussions.  Once the boards, financiers and lawyers kick into gear, some deals happen more quickly than others.

I’ll share my perspective in a second, but let’s first look at the two companies and their current marketing application capabilities.

Teradata – Since departing from NCR in Q4 of 2007 they have been silently gaining momentum in the EMM space with a renewed sense of innovation.  Teradata is first and foremost a BI company creating databases.  However, they do possess some EMM tricks up their sleeve, centered on the six modules in Teradata Relationship Manager (TRM):

  • Actionable Analytics
  • Campaign Management
  • Offer Management
  • Interaction Management
  • Communication Optimization
  • Marketing Resource Management (via AssetLink)

 

All of these components are tied together in the following graphic taken from one of their online TRM literature pieces:

Teredata

Aprimo – As one of the industry leaders in marketing software, they are most recognizable for their flagship, best-in-class Marketing Resource Management (MRM) product that includes:

  • Production and Workflow Management
  • Planning and Financials
  • Marketing Calendar
  • Offer Management

One of the intriguing things about Aprimo is that they have developed almost all of there near 25(?) modules organically.  These modules are mixed and matched Chinese menu-style into neat little bundles: MRM, Campaign Management, Lead Management, Performance Analysis, etc.  Because their growth and development has been relatively organic, Aprimo created a tightly integration set of tools that can be conveniently turned off and on with the ‘flick’ of a license key – which is a real competitive advantage over competitors like Unica.

Something else Aprimo has recently invested in over the last couple years is cloud based, Software-as-a-Service (SaaS) marketing.  They have an on-demand offering of their entire EMM suite to those companies that don’t have the resources (or desire) to host their own technological components, including email distribution.  While we’re not sure on how many clients are on this offering the reactions I’ve heard have been positive.

Considering the overlap – and only recently filled gaps, the match-up does raise some eyebrows:

  • To-date, Aprimo has taken on a database agnostic approach linking with Oracle, DB2, SQL Server and even providing their own (via Data Source Management) for those few clients needing some help.  Interestingly, they only started natively connecting to Teradata in their 8.5 version, released just a little over a year ago.
  • Teradata’s Campaign Management tool is more highly regarded by the analysts
  • Teradata said it will keep the Aprimo brand and tools as is (for now);
  • Post acquisition the plan is for Bill Godfrey to lead the Applications division of Teradata

Analysis – With the two largest players in the enterprise marketing space (Unica and now Aprimo) being acquired its clear to most that there is some real sustainable value to be had in the world of marketing automation software.  There is a concern that such acquisitions may slow down the pace of innovation.  The bigger the owner, the higher the overall revenue threshold required for “differentiation” to deliver value.

Aprimo has made great strides to improve their Multi-channel Campaign Management (MCM) offering.  However, it still falls short on the Gartner MCM magic quadrant report from May 2010.  Luckily, that appears to be one of the few EMM type applications Teradata has invested in and seen relative success.  And though the official word is that they will be maintaining both MCM tools after the merge, it’s hard to think that is part of the long-term vision.

Teradata’s user interface looks like a database developer created it.  They needed something a little more visually appealing to capture the hearts of the non-techie marketers of the world – and Aprimo does just that.  I would venture a guess that they eventually end up taking the skin of Aprimo’s MCM with the guts of Teradata’s to make a “new” product.

Continuing with this line of thought, know that one of the simple beauties of this union is that each has different strengths in the EMM world.  If they choose to consolidate and bring the best of both worlds together, they could have a nice, high performing database platform with a robust (and upgraded) EMM suite wrapped around it to help companies leverage and operate their marketing departments at a higher level of efficiency.

Along those lines, it will be interesting to see if moving forward Teradata keeps to Aprimo’s single architecture model or if that is one of the things that gets left behind in the merge.  * I have a $5 bet with one of our Aprimo SME’s (Liz Kaufman) that it maintains what it has on the single architecture, but won’t be introducing any of Teradata’s existing products on to the single architecture structure…without seeing the software ‘guts’, my guess is that it will be too much time and money…but who knows, maybe with Mr. Godfrey at the helm it’s a priority?

Teradata thrives on large volumes of data.  However, what’s not as publicized is the client overlaps with those who have Unica as their Campaign Management (and other EMM) software provider.  Having worked with a few of these companies myself I will go on record as saying the Teradata/Unica combination has seen its fair share of hiccups – operationally speaking of course.  Now with the two of them playing on ‘competing’ teams I asked my magic 8-ball if things would get better and it said: “Outlook not so good”.

So if I’m a CMO, CIO, or CTO unhappy with my current Teradata/Unica system’s performance, I have three choices:

  1. Replace your entire data warehouse to a new product such as DB2.  Not seeing that as overly viable.
  2. Replace your EMM software suite (and now Teradata can deliver a highly regarded bundle)
  3. Tweak, tinker, tune and otherwise live with it

 

In examining those options, I would look for a migration of Teradata/Unica customers to transition over to the Aprimo platform in the next 2-4 years as their Unica contracts come up for renewal or their software needs to be upgraded.

As a final note, the one item that no one is talking about is how this ends up impacting Teradata’s current MRM partner, AssetLink.  Obviously, this is a huge blow to them but I would venture a guess that they have a strong enough base of customers to weather the storm (and probably soon be acquired too…is that Oracle knocking?).

 

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