News Analysis
Acquia plugged a “big hole” in its Digital Experience Platform (DXP) strategy in customer data management with its acquisition this week of Customer Data Platform (CDP) provider AgilOne, said Forrester senior analyst Mark Grannan.
However, other analysts and industry watchers told CMSWire the Boston-based provider could have a challenging path integrating the product into its suite. “There’s a lot of tough integration ahead for them, and the AgilOne team will have to get used to Vista Equity’s Vista Standard Operating Principles (VSOPs) which often make it hard to innovate and limit the marketing investment required for high growth,” said R “Ray” Wang, principal analyst and founder of Constellation Research.
Acquia Poised to Stitch Martech Together
The aforementioned integration challenges ahead for Acquia come after the provider made three significant acquisitions this year:
- May 8: Acquia acquires marketing automation provider Mautic.
- Sept. 4: Acquia acquires Cohesion, a “low-code” Drupal website builder.
- Dec. 11: Acquia acquires CDP provider AgilOne.
AgilOne represented Acquia's third major acquisition of marketing technology this year. It's more like its fourth if you consider that Acquia itself was acquired by Vista Equity Partners for $1 billion in September.
Acquia believes it can pull off the integrations required to weave together the newly-acquired technologies. Steve Schult, VP of product for Acquia, told CMSWire in an interview this week that marketers “aren’t going to school to be data scientists,” and having AgilOne’s customer data platform technology built into its digital experience platform will help them turn customer data into personalized, one-to-one experiences more easily.
Acquia will now have better integration capabilities for web personalization in its marketing automation offerings, Schult said. AgilOne will bring machine learning capabilities that can go across Acquia's entire platform, unifying online and offline data sources. “We can really provide a unified offering that marketing organizations can use rather than stringing together different point solutions,” Schult said. “So this is really intended to be an acquisition that we pull together across Acquia’s entire open DXP. The addition of AgilOne will give marketers a “significant opportunity with unified actionable data in real time, he added." While he noted that there are other providers out there that have some of these capabilities, he thinks their organization is in a place where they can stitch these together and compete in the DXP space.
Related Article: Vista Equity Partners Acquires DXP Provider Acquia for $1 Billion
Intelligent Approach to Customer Data
Grannan said the acquisition addresses a large need in Acquia’s DXP strategy in relation to customer data. “While Lift (Acquia’s personalization tool) and now Mautic had some behavioral data capabilities, neither one was close to what enterprise customers are going to need to assemble a real-time behavioral profile.” This paves the path toward greater customer data insights. Data set quality and size matters when it comes to personalization and relevance, he added.
The only way to slice and dice large scale behavioral data at scale is via artificial intelligence (AI)/machine learning. “AgilOne brings a much stronger customer insights claim to drive relevance via Lift and Mautic — aka Acquia’s recently announced Marketing Cloud,” Grannan said.
Related Article: Does Your Organization Need a Customer Data Platform?
Integration Challenges Concern Marketers
But integrations still don’t come easy within these marketing technology components, according to Ben Bloom, senior director in the Gartner for Marketers practice. According to the Gartner Marketing Technology Survey 2019 (subscription required), 57% of marketers say that they prefer a best-of-breed approach, in which they source the “best” solution to solving challenges or advancing marketing’s ability, irrespective of the vendor. Only 29% state they prefer an integrated suite approach.
The reason? Potential integration challenges. “The shift toward best-of-breed, compared with our 2018 marketing technology survey, may stem from integration promises that never materialized from the single-suite vendors,” Bloom told CMSWire. “We advise clients to push for apples-to-apples comparisons between standalone and integrated suite solutions for customer profile management. The allure of the integrated suite may itself be in a trough, as major vendors add new capabilities to address shortcomings.”
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AgilOne Could Be 'Connective Tissue'
However, Bloom added, customer profile management capabilities do, and likely will, continue to exist in multiple solutions such as multichannel marketing hubs, personalization engines, loyalty management platforms and account-based marketing platforms. “In a similar vein, AgilOne could be positioned to provide some connective tissue between Acquia’s web content management, personalization and marketing automation (Mautic), easing the pain for marketing and CX teams looking to have clear visibility into their customers and unified workflows,” Bloom said. “Despite the possibility that a broader set of tools may be competitive against larger players, the onus will be on Acquia to integrate and unify their capabilities in order to avoid the headaches that have plagued customers of other integrated suite solutions."
Related Article: Will the CDP Marketplace Consolidate in 2020?
Extensive Data Integrations Required
These martech solutions at stake are not as easy as marketers perceive to implement, and require extensive data integrations to maximize their potential, according to Michael Harrison, managing partner of Winterberry Group. Therefore, the Acquia acquisition of AgilOne signals that delivering personalized customer experiences is difficult without a unified data layer. “Marketers, agencies, and technology providers are focused on digital transformation, but [most seem to forget] that before digital transformation can happen, data transformation must occur,” Harrison said. “Data transformation includes real-time ingestion of online and offline data, developing a universal view of the customer, and making that data available to the analytics and application layers.”
Marketers, Harrison added, feel that technology makes delivering personalized customer experiences more difficult due to all of the integration work that must occur to bring the stacks to life. What do they want? “Enterprise marketers are looking for best-of-breed solutions due to the sophistication of their technology group, marketers and partners,” Harrison said. “The mid-market is looking for simplification, which manifests itself in solutions with multiple capabilities, including CDP functions, analytics, decisioning/orchestration and digital activation. Mini-marketing stacks are beginning to evolve to solve for the mid-market demand.”
Mad Dash for CDP Investments in 16 Months
Acquia’s integration challenges aside, there is no denying the emergence of CDPs, highlighted by the flurry of acquisition and CDP in-house investments made by major marketing technology players in the past 16 months.
Adobe, Salesforce, Oracle and SAP each built their own CDPs this year in a seemingly hurried rush to toss their hats into the ring alongside existing CDP vendors. The CDP Institute reported the industry will reach $1 billion this year and grew in funding by $680 million the first half of the year.
According to David Raab, founder of the CDP Institute, other significant acquisitions in the space include Mastercard/SessionM, Dun & Bradstreet/Lattice Engines, Arm/TreasureData, Datorama/Salesforce and Informatica/Allsight. Each of those CDP industry moves — and the in-house CDP announcements from the major marketing clouds — have come in the past 16 months. And there was this move: Last month, IgnitionOne, a longtime database marketing/adtech/CDP vendor, announced a liquidation. Lots of signals in the CDP market to digest.
Quest for Extensive Customer Database
What’s the pattern amid the CDP craze? “I do agree that acquirers so far have not been companies whose business is selling customer data management systems, even though most of them do have substantial expertise in managing customer data,” Raab told CMSWire this week. “Acquia fits that pattern: while CMS is a martech function, it’s not one that actually involves building an extensive, individual-level customer database. So if they wanted to add that capability quickly, they had to buy it. Salesforce, Adobe, Oracle, and Microsoft do manage individual-level customer data in their systems, which is probably why they felt they could build their CDPs internally."
Acquia has an ambition to build a proper multi-channel “digital experience platform,” which means they do need to support all channels and have a proper customer-level database at the core, according to Raab. “They bought Mautic recently for marketing automation, which filled an important gap but didn’t solve their customer data problem,” he said. “AgilOne does that, in addition to providing advanced segmentation, personalization, and campaign management. Acquia will likely target mid-market companies that don’t want to pay what Salesforce, Adobe, and Oracle charge for their systems.”
All About ‘CDP Inside’ Trend
The ultimate significance of this Acquia-AgilOne deal is less about “martech vendor buys CDP” than it is “broad platform vendor adds CDP component,” according to Raab. It’s an example, he said, of a “CDP Inside” trend he’s been tracking for a while, where vendors with broad product suites add CDP as one more capability.
“This makes CDP,” Raab said, “more widely available to marketers, who can get it as an option with their email, CMS, or other delivery systems, as vendors in those channels all seek to broaden their products from single channel to omni-channel ‘experience platforms.’ Marketers will still have to decide whether the ‘CDP Inside’ those systems is powerful enough to meet their full needs, since in practice few companies will run all channels on products from a single vendor. Buying a first-rate CDP like AgilOne solves that problem quite nicely, so it makes good sense for Acquia.”
