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30/05/2012 by

Chess Game: Why Salesforce Buys Buddy Media?

Some might still believe that Salesforce is a Sales-CRM solution for SME’s in the US. But take a look at below acquisition roadmap and you will see that Salesforce is pushing for world domination. Read along to discover a very interesting strategic chess game

Chess Game: Why Salesforce Buys Buddy Media?

In 2011 Salesforce already bought social media monitoring company Radian6 for $326 million. That acquisition shook-up the entire social media industry and earned the attention of many analysts around the globe.

Now Salesforce announced the acquisition of Buddy Media for $800 million. Oracle already acquired Vitrue a week ago, so imagine what move Google and IBM will play next…

Buddy Media started 5 year ago with a smart Facebook Content Management System (CMS). Soon after the firm extended its community management platform in clever ways.

Within my agencies they’ve used the Buddy Media suites several times, i.e. to manage glocal (global and local – across 17 markets) Facebook pages for innovative brands. The feedback from our teams: the Buddy systems offer great value for money.

Buddy Media extended its services to Google, Twitter and LinkedIn rapidly. In a few rounds, Buddy Media got funded with $54 million, and leading global communications network WPP was one of the funding partners, and has a special partnership with Buddy Media.

Second global communications network Omnicom also has a preferred partnership, with Facebook ad-buying company Blinq Media.

And to make it more complicated, Interpublic Group (IPG), owner of agencies like McCann Erickson and DraftFCB, doesn’t seem to own a Facebook ad-buying company. However, in 2011 IPG took a tiny stake (0.4%) in the blue monster Facebook.

Recenly Buddy Media acquired social ad-buying tool (for i.e. Facebook advertising) Brighter Option to sync paid and owned media.

Now Buddy Media is owned by Salesforce, leaving Google that was bidding to buy Buddy Media too, biting the dust. Now this ‘loss’ is pretty painful for search giant Google in several ways.

Google really needed Buddy Media to upgrade its reputation, grip and drive in the social space. Because Google needs to step up its social game extremely fast. Not only for reputation purposes, but more important to finally show its capability to coin social network advertising to its shareholders.

Google+ is not making lots of direct money, only fueling social search. But from all social network advertising revenues, 71% (in the US) goes to Facebook.

And the option to buy Vitrue, a social media SaaS marketing application (a similar company as Buddy Media), is no longer available to Google, because Vitrue was acquired by Oracle on 23 May 2012!

Now I guess that IBM might be planning to make a move as well. Because IBM can’t stay behind in this space, although IBM already acquired SPSS in 2009. But IBM could be looking to acquire another Facebook technology provider, any given sunday.

So IBM and Google might be already be preparing their next moves as we speak.

Now I would like to read your opinion. What might be the next move(s) in this chess game? Please share your ideas in the comments below.

Sources: Reuters, TechCrunch, AdAge, Business Insider, Oracle, IBM and AuthorityLabs.


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