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Thứ Sáu, 27 tháng 12, 2013

SAP May Counter Oracle's Responsys Bid - CruxialCIO

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Could Oracle and SAP enter a bidding war for Responsys? Industry observers believe it's possible.

Oracle announced last week that it would pay $1.5 billion in cash for the cloud-based marketing software provider. The deal followed a similar acquisition in June by Oracle rival, which paid $2.5 billion for ExactTarget.

Oracle has offered about $27 a share for Responsys, a 38 percent premium over its market price at the time. The deal requires approval by investors who may want more.

CIOs and CMOs should watch the marketing technology space carefully. With so many vendors adding capabilities to products, the time is right to kick the tires to see if cloud-based marketing services can increase sales.

Immediately after the announcement, Responsys stock soared to $27.40 and was trading at about the same amount on Friday. JMP Securities analyst Pat Walravens says Oracle's bid is too low and has set a target of $33 a share, according to the Silicon Valley Business Journal.

In suggesting Oracle should pay more, Walravens points to the much higher price paid for ExactTarget.

Cloud-based software to execute, manage and analyze marketing campaigns is expected to be "the most important battleground for technology providers over the next decade," Rob Brosnan, analyst for Forrester Research, said in a recent statement.

SAP was checking out Responsys before Oracle announced the acquisition, The Wall Street Journal reported. Given that the deal won't close until early next year, it's possible SAP could return.

Oracle definitely needs Responsys' cloud services, Brosnan says. While Oracle is strong in software for accounting, sales and customer management, it lacks strong products for marketers.

"Oracle hasn't performed all that well in the marketing departments, where historically they just don't have a lot of cache," Brosnan told CruxialCIO. "Oracle tends to be a little bit further back in the office."

In the meantime, Responsys competitor Marketo is reaping the benefits of all the attention the market is getting. On the day of the announcement, Marketo's stock rose 15 percent to $38.17 a share. On Friday, the stock was hovering around $36 a share.

In general, marketing software enables companies to interact with customers while they are on the Web browsing sites, on social media or checking email. The ability to pitch to potential customers and then analyze the effectiveness of campaigns is expected to increase the likelihood of gaining new customers or upselling to current ones.

Responsys would be Oracle's second acquisition in the marketing technology space. A year ago, the company said it would pay $810 million for Eloqua, which also provides its software through the cloud.

Besides Oracle and, Adobe has also jumped into the market, paying $617 million for Neolane in July.

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