While the likes of Facebook and Twitter have revolutionized the flow of information, IBM Corp. has quietly staged a coup of its own by creating a centralized consumer feedback apparatus valued at $20 billion.
IBM, witnessing the struggles of retailers, service providers and manufacturers to address the evolving consumer demand, first embarked on its Smarter Commerce initiative two years ago with the aim of providing businesses with a means of accurately gauging what their customers were searching for.
In the time since, IBM has assembled a daunting array of analytic assets through acquisitions and partnerships, positioning the Armonk tech giant to seize on a market that they say was previously unoccupied.
“IBM suffered a near-death experience by not keeping focus on our customers, so we have become reformed on this topic and we have seen the benefits of applying technology to yield better and deeper and more sustained results with our customers,” said Craig Hayman, who as general manager of IBM Industry Solutions heads up the Smarter Commerce initiative. “This is the way forward. This is the future.”
In 2010 and 2011, IBM invested more than $5.5 billion to bolster its Smarter Commerce portfolio, acquiring at least seven companies over the last 12 to 18 months that each have a specific area of expertise in the fields of sales, marketing and analytics.
“We had this idea. We then went off and started acquiring what we called the best-in-class businesses ”“ leaders in their segments,” Hayman said. “We then launched that and we called it Smarter Commerce.”
Today, through its Smarter Commerce initiative, IBM is working with more than 2,000 businesses worldwide to provide them with a combination of cloud-based and software-based programs that analyze their customer”™s spending behaviors and demands.
IBM estimates that the market for this Smarter Commerce software alone will be worth $20 billion by 2015, and Hayman said he expects to be working with more than 3,000 global brands by the end of 2012.
Just last week, IBM put the finishing touches on yet another piece of the puzzle, announcing Feb. 1 that it had completed its acquisition of Emptoris Inc., a cloud-based analytics company that specializes in procurement and supply chain operations.
Other companies that have previously been incorporated into Smarter Commerce include Sterling Commerce, Unica Corp., Coremetrics, DemandTec, and Tarrytown-based Datacap Inc., among others.
Already more than a dozen of the country”™s biggest retailers have signed up with IBM to make use of the Smarter Commerce technology, including Abercrombie and Fitch Co. and Urban Outfitters Inc.
Hayman said many small to mid-size companies have expressed interest as well, noting that several aspects of Smarter Commerce are cloud-based and thus are more affordable for smaller companies.
“Those brands (Abercrombie and Fitch and Urban Outfitters) are ones that you know about because they have some level of brand recognition, but there are companies all over the world of different sizes and we plug them in as well,” Hayman said.
One such entity was Seton Hall University in New Jersey, which looked to IBM for assistance with its social media marketing strategy.
“They were feeling good about running this social media campaign … and we went in and showed them through analytics that in fact their campaign was not yielding the results they wanted,” Hayman said. “So we had the metrics … using that we were able to help them adjust and fine-tune their social media so they could make their campaign more effective.”
The demand for Smarter Commerce has been so great that IBM has brought on a number of partners to help it implement and market its technology solutions.
CrossView Inc., based in Somers, has worked with IBM since 1997 and in 2008 became the first worldwide business partner to be Smarter Commerce-authorized.
The company, with roughly 200 employees, has posted annual growth of more than 50 percent in 2009, 2010 and 2011 ”“ largely due to the success of IBM”™s Smarter Commerce initiative, said Leila Ashley, vice president of marketing at CrossView.
With less money to go around and more information available to consumers than ever before, Ashley said CrossView”™s customers wanted to “own the brand experience.”
“That”™s what we saw,” Ashley said. “No longer can we do what we want to do, but we have to focus on the customer and create that customer-centric shopping experience for this very empowered customer.”
