News recently broke that analytics firm Verint will acquire enterprise feedback management (EFM) vendor Vovici. I think the acquisition makes a lot of sense (we predicted that this type of consolidation would happen) and will benefit both firms. I also think it demonstrates a few major trends that customer experience folks should note:
Vendors are hungry to serve chief customer officers (CCOs). We all know that companies are taking customer experience more seriously these days, and many have established CCO positions accordingly. That has created a new target for the broad set of vendors playing in the customer experience space. Verint and Vovici are trying to meet this new buyer’s need for insight into customers’ end-to-end experiences by pulling together information from across channels, data sources, and data types. The press release even cites the rise of the CCO as a reason for the acquisition. Expect to see more companies go directly after CCOs this year.
There are many more EFM vendors on the mergers and acquisitions (M&A) menu. Like Vovici, most EFM vendors are relatively small tech companies with their eyes set on rapid growth. They’ve seen sales spike recently from companies embracing customer experience as a discipline and recognizing the need to use customer feedback more effectively. Now the vendors are pushing to enter the mainstream. To succeed, many will find suitors like Verint that have cash (not that much is needed here) and holes in their existing solutions to put EFM into a more complete package.
Consolidation will come in two flavors. Verint and Vovici are a good combination, but that’s not the only type of consolidation we’ll see for EFM vendors. Consolidation will aim to create two things:
- Customer experience solution sets. Vendors (like Verint) that have solutions for certain aspects of the customer experience (like customer service via contact center) will acquire EFM vendors to add much-needed feedback collection, analysis, reporting, and action management capabilities to their existing offerings. Expect to see vendors like NICE and RightNow follow Verint’s lead.
- Voice of the customer hubs. Client-side companies have started to build centralized voice of the customer (VoC) programs, but they don’t have a single solution to handle their key activities. Vendors within the EFM, social listening, and traditional market research spaces will respond by consolidating to create VoC hubs. Even within the EFM space itself, expect to see vendors that have traditionally sold to market researchers (like Confirmit) combine with those that focus on transaction-level feedback for large multi-unit and contact center organizations (like Mindshare).
While the EFM space won’t disappear anytime soon, evolution is certain, and it will be fast. Do you think that evolution will go the way I’ve described, or do you have another vision in mind? I’d love to hear your thoughts.