Thursday, April 26, 2007

Responsys Buys Loyalty Matrix

Speaking of integrated systems, consider yesterday’s announcement that email marketing provider Responsys has purchased Loyalty Matrix, which offers on-demand marketng analytics. According to the press release, Responsys hopes to become “the only on-demand marketing company capable of helping marketers not only deliver – but predict and deliver – the right messages to each customer, via email, direct mail and mobile.”

It’s tempting to read this as part of the on-going consolidation within the digital marketing industry, related to the Omniture/Touch Clarity and Acxiom Digital/Kefta deals announced earlier this year. But, judging from their Web site, Loyalty Matrix offers off-line analysis and promotion recommendations, not the real-time targeting and personalization of Touch Clarity and Kefta. Loyalty Matrix also extends beyond digital channels to take data from all sources and produce multi-channel contact strategies.

So something else is going on here. Responsys is positioning itself as a marketing services agency, combining strategy, analytics and execution, than a software developer or message delivery provider. This would put it more in competition with firms like Acxiom, Knowledgebase and Epsilon. Many of those companies already provide email execution similar to Responsys’s core business, so in some ways this could be seen as a defensive expansion by Responsys.

But the heart of a marketing services agency is its ability to maintain sophisticated marketing databases. This would be a big change for Responsys, which now works mostly with lists that clients generate elsewhere. Loyalty Matrix does some database building, but its more to integrate snapshots for analysis than to manage databases over time.

As I wrote yesterday, building the database is tougher than analyzing it. Loyalty Matrix could be the foundation of a new Responsys business or it could just add some analytical punch to its current offerings. It will be interesting to see which road Responsys follows.

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