Oracle Acquisition of Vitrue is a Boon to Social Media Engaged Brands
Erin is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
As a former social media marketing consultant, I pay a great deal of attention to major acquisitions and developments in the digital and social media industry. Few have excited me like the Oracle (NASDAQ: ORCL) acquisition of Vitrue.
Vitrue is a cloud-based social media marketing firm that enables brands to harness the full marketing potential of social on Facebook, Twitter, Google+, YouTube and emerging platforms. The Vitrue SRM (social relationship management) platform collectively manages more than one billion social relationships in over 100 countries across more than 4,500 social accounts for its clients. In plain English, that means that Vitrue helps very large brands (which has included McDonalds, Yahoo, American Express, and Southwest Airlines, just to name a few), figure out who is talking about them, where it was said, and when it was said. To the largest of brands, and the smallest of brands, this information is invaluable.
The proliferation of social media has changed the art and science of advertising, particularly for the largest of brands. It is no longer a matter of creating a product, testing it in a few markets, buying some TV and print ads, and letting it sell. Feedback came in the form of sales. But now that has changed and brands are able to measure not only who buys their products, but what they say about it to their friends (which can be considerably different from what a study group said on a survey after testing). Ads are now able to reach precise target audiences- need 32 year old, single females, with a college degree, who like Justin Bieber and Celine Dion, and live within 300 miles of Atlanta, to market your new perfume to? You can get that specific with social media advertising networks. And services such as Vitrue help brands figure out if that advertising is working.
Now combine that ability with the resources of Oracle.
Vitrue's already award-winning, unique, and sought-after SRM platform will have even greater capabilities and offerings if handled right by Oracle.
From a social media analyst point of view, this acquisition is exciting and very promising. From a business point of view, it makes sense for Oracle in light of its acquisition of RightNow (NASDAQ: RNOW) in October 2011. RightNow provides customer management software using a cloud-based SaaS model that helps companies manage how customer service teams interact across multiple channels--through call centers, over the Web, and in social networks.
It is just an assumption on this writer's part that Oracle would want to combine the services and technologies offered by RightNow and Vitrue with its own capabilities. The results of such a combination could make a significant impact and change in future advertising and marketing reach and interaction for brands and customers. To put it bluntly, I think the potential of these resources pooled together could be a game-changer for all advertisers and brands.
The combination of services effects multiple sides of the advertising equation. Not only does it give brands a better ability to target their markets, it indirectly helps the social networks themselves provide a better service. If a brand has a better understanding of who is viewing and engaging with its Facebook (NASDAQ: FB) ads, it better serves the brand, and helps Facebook make a better sale.
Though terms of the deal were not disclosed, TechCrunch is reporting that Oracle will pay about $300 million for Virtue. The acquisition of RightNow was announced in October 2011 for $1.5 billion, and was approved in December 2011.
Oracle has long been a formidable company, but in recent years has been called an “old school software company.” These acquisitions show a distinct and unquestionable move towards the future and next big thing. Oracle has the potential to pave the way to being the bellwether in social relationship and marketing management. And I, for one, hope it will live up to my expectations.
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