Yesterday morning, InsideSales.com announced an acquisition of C9, a deal between two of the major players in the predictive sales analytics market. (You can read the Gartner First Take about the deal here).
Viewed in isolation, the deal makes perfect sense. The companies weren’t really direct competitors as InsideSales.com targets inside sales teams with predictive and prescriptive solutions for propsecting, scoring leads, communicating with contacts and motivating reps, while C9 (a 2015 Cool Vendor) focuses later down in the funnel with predictive and prescriptive solutions for field reps (opportunity scoring) and sales managers (forecasting and pipeline management). There is very little overlap in the product sets, and the companies only share a handful of customers, so lots of opportunity for cross-selling to the existing bases. And when the two solutions get integrated and presented in a single interface (both inside of SFA systems and the dedicated application), you’ll have arguably the most comprehensive predictive sales analytics platform on the market.
While sales analytics can be viewed as a distinct market, Gartner views it as part of a larger market, one that includes solutions for both marketing and sales leaders since the buying journey (and the sales cycle) encompass both groups. (See the graphic below).
In our Market Guide for SaaS-Based B2B Predictive Sales and Marketing Applications, we talked about the market being very fluid, with new entrants appearing monthly (a trend that still continues), but also some consolidation. So is this deal one that happened simply because it was synergistic, made a ton of sense and InsideSales.com had a lot of cash to spend (they recently raised $60M bringing their total funding to $199M and a “unicorn”-level valuation of $1.5 Billion) or does it signal the beginning of a wave of M&A activity?
While many Gartner clients have literally dozens of marketing technology tools in place, that type of approach doesn’t work nearly as well for sales. Even if you think about the applications only being visible in Salesforce or Microsoft Dynamics, you can’t add tabs or fields indefinitely and you certainly can’t ask salespeople to go to six different browser windows.
There is also a trend towards predictive sales and marketing platforms or suites rather than “point” applications, and providers like Lattice Engines and 6sense are rapidly rolling out solutions to address the entire funnel and process, encompassing both marketing and sales. Both InsideSales.com and c9 had a more diverse portfolio of predictive applications than the vendors that focus on prospecting, account-based marketing, lead scoring, opportunity scoring and renewal/upsell/cross-sell, but there are still some intriguing combinations of vendors that could bring a lot to the table when they join forces.
The million dollar question of course is what do the SFA players (not just Salesforce and Microsoft, but SugarCRM and others) as well as the Lead Management vendors (namely Marketo and Oracle/Eloqua) do next. Both Salesforce and Microsoft participated in InsideSales.com’s last round of funding, so one would assume that they wouldn’t roll out their own solutions or acquire a competitor in the near term, although stranger things have happened. Marketo is not only a partner of both InsideSales.com and C9, but also a joint customer that was quoted in the press release. So it’s likely this deal doesn’t spur any immediate action from the bigger players.
However, if it turns out that yesterday’s deal is merely the beginning of a wave of activity, you can bet that the bigger players will pay closer attention and think more urgently about their long-term strategies. Even if the deal happens to be an isolated case, the desire of B2B sales and marketing leaders to leverage predictive analytics to improve effectiveness and productivity is only going to continue growing. Either way, expect a lot of action in this area, be it from M&A, new entrants or sexy new products.
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