“Epsilon Interactive”:http://www.epsiloninteractive.com – “formerly”:http://www.alliancedatasystems.com/news/newsreleases/viewrelease,753949.html Bigfoot Interactive – has announced it is acquiring DoubleClick Email Solutions, the email business of DoubleClick Inc. “Here’s the press release.”:http://www.epsiloninteractive.com/eisite/pressroom/press_releases/pr2006/pr-02-14-06.htm
Epsilon, itself is a division of “Alliance Data Systems”:http://www.alliancedatasystems.com which owns Canada’s “Loyalty Group”:http://www.loyalty.com and their “AIR MILES”:http://www.airmiles.ca national coalition loyalty program.
So what does this all mean to Canadian marketers?
Those who have been around the email industry awhile will remember that Canada’s FloNetwork was originally acquired by DoubleClick “in 2001”:http://www.clickz.com/news/article.php/597341. Lately a bunch of email service providers (ESPs) have been acquired as the industry consolidates. This latest news is another sign of that. Until recently, however, most of the acquired ESPs have been smaller. With Bigfoot and now DoubleClick being acquired we are seeing some of the bigger players making changes. Who’s next?
As someone who has been in the email industry for a few years now, I can point to the fact that it is very difficult for any of the 150 or so ESPs (that I know of) to make it past a certain size. This includes those companies that have their own proprietary technology and those that private label another company’s technology. For the smaller ESPs, the most successful ones are those that find a market or niche and are able to own it. For most it is difficult to compete with the larger players that tend to have more resources, ranging from sales and support to integration and other specialized services. And once an ESP is dependent on one or two key clients, resources tend to go to supporting those clients.
If you are a DoubleClick customer in Canada is this acquisition a good thing?
Time will tell. For sure there will be some increased stability. DoubleClick Inc. was acquired by a group of investment companies last year (“more info”:http://www.doubleclick.com/us/about_doubleclick/press_releases/default.asp?p=508). However, as the “Epsilon press release”:http://www.epsiloninteractive.com/eisite/pressroom/press_releases/pr2006/pr-02-14-06.htm states, the intent is to cross-sell and up-sell to the combined customer base. Historically, after past acquisitions of ESPs by companies in the print or data space, this has caused some complaints. _(Editor’s Note: Alliance also “recently acquired”:http://www.i-com.com/aboutus_news_detail.asp?pid=47 Canadian marketing data firm “ICOM”:http://www.i-com.com/ complicating things further.)_
I think there will be a lot more consolidation in the industry. Only the strong companies with lots of customers and healthy revenue streams will survive intact. But they will only make it if they innovate. Many ESPs will be acquired; some for their technology and many just for their client lists.
When looking for an email partner it is important to look at their overall health in terms of number of clients, capacity to support your business and the changing landscape of email marketing, and their ability to be your partner now and in the long run. Probably the most important criteria is deliverability and getting email to the inbox. For more information on this, “read my earlier One Degree post on selecting an email partner”:http://www.onedegree.ca/2005/10/19/selecting-an-email-marketing-partner. Also, consider speaking with a company’s clients, especially those in your line of business.