Recent days, acquisition of social media start-ups by the public
listed companies are increasing. This trend started early 2012.
Microsoft is acquiring the social media company "Yammer"
that has tool for the easy collaboration among employees and increase the
productivity. This is one of the biggest acquisitions in social media
start-ups. Microsoft pays around $1 billion as it is looking for a major change
to come out of its stagnation.
Facebook acquires Instagram a photo sharing mobile app company for
around $1 billion is cash and shares.
Salesforce.com acquires Buddy media a social marketing company
that has facility to publish content, provide marketing Ads and measure the
effectiveness of its marketing activities. This acquisition also involves major
money i.e. around $700 millions.
Oracle has acquired Virtue a social marketing company for
$300M.
How are these social media acquisition helps the companies? Will
it improve their business or this is also one kind of .com bubble?
Today, the social media sites are getting more users and very
frequent visitors. After the gaming sites, these sites are getting more
traction from all groups/ages. So users are familiar with the usage. By
bringing in similar approach in the business apps and bringing
in the collaboration as a part of the business applications, the
productivity will be increased. Also the traditional marketing is not bringing
enough business and conversion tracking is an issue, by moving to social media
these difficulties are eliminated.
Why do companies going for acquisition instead of using their
services? Is it adding value to these companies?
As the CRM, Social Media and Marketing getting more traction, all
the businesses wants social media marketing and monitoring the marketing
activities. If the business applications like salesforce.com etc. integrates
their services with the social marketing and monitoring tools, the value
addition to their customers will increase and the growth of their customers
will increase. This will be one more marketing value addition they can propose.
We have to wait and watch how this strategy works for these
companies.
Saravanan
