A couple of weeks ago I covered the fact that marketing automation vendor Salesfusion had just raised a series B funding round to further its goals of growing its business. Underneath that ambition however I suspected a deeper plan – you see there has been a large amount of M&A activity in the space in recent time, Salesforce.com got Pardot as part of its ExactTarget acquisition and Oracle acquired Eloqua. Microsoft however doesn’t have a strong marketing automation story to tell natively alongside its DynamicsCRM product. Eagle eyed watchers pointed out that Microsoft did indeed acquire a vendor, Marketing Pilot, in 2012 but this doesn’t seem to have gone very far for them. So if you’re a marketing automation vendor watching the broader sector movements, it makes perfect sense to focus your operations on making the most attractive acquisition target possible.
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Salesfusion is doing just this – while it is integrated with a number of CRM players (among them NetSuite, Sage CRM, SalesLogix and SugarCRM) it keep its deepest integration for Microsoft Dynamics. At the same time its focus is unashamedly more mid-market than some of the other players, again an approach that sees them dovetail nicely with Dynamics’ focus. They’re dangling bait in front of Redmond’s eyes in the hopes that Microsoft will bite.
That strategy took another step today with the announcement that Salesfusion has acquired another company, LoopFuse. LoopFuse provides simple marketing automation tools alongside social listening and publishing tools – it has been adopted predominantly by small and mid-sized companies. With the deal, Salesfusion is embedding the social media tools directly into Salesfusion suite and therefore adding the flavor de jour, social media marketing automation, to its overall platform. Again this combination of functionality speaks directly to the mid market who are always eager to find complete solutions rather than to tie together a number of different threads.
The approach Salesfusion is taking is logical – having spent time running and working with mid-market businesses I know only too well the hassle that is involved in stitching together discrete applications – marketers want a “one stop shop” that gives them all the marketing functionality that they need. And of course social is one of the most important tools they have in order to lure customers.
Of course there are risks to Salesfusion’s strategy of looking for a Microsoft deal – it’s always hard to intuit what a massive vendor is thinking, and M&A can be a long and fraught process. The good think about the LoopFuse deal however is that Salesfusion gets to build a more credible story anyway, one that will resonate with its customers. Even if an acquisition doesn’t pan out, that’s a good situation to be in.
Terms of the deal have been kept confidential, but it seems to me that some of that series B money has just been well spent.