IBM buys Web analytics software company

IBM continues buying spree with purchase of Coremetrics, a marketing analytics provider

IBM will purchase Coremetrics, a provider of Web analytics software, the company announced Tuesday. Terms of the deal were not disclosed.

IBM will add Coremetrics into its portfolio of business analytics software and services.

A privately held firm, the San Mateo, California-based Coremetrics offers a set of cloud analytics services that helps companies better market their brands. The service can help companies get e-mail pitches and personalized recommendations to the appropriate customers, and use customer analysis to place ads on the most-suitable networks and better manage the purchasing of search terms.

Coremetrics customers include Bank of America, Holiday Inn, Office Depot, Petco, Victoria's Secret and Virgin Atlantic Airways.

Big Blue has been busy acquiring companies of late, particularly those that focus on data management. In May, it announced that it would be purchasing cloud-based data integration provider Cast Iron, as well as middleware provider Sterling Commerce.

As part of the Coremetrics announcement, IBM revealed some results of a survey it took of CEOs, including that 82 percent of CEOs who were surveyed want to better understand customer needs.

Coremetrics employs about 230 people, who will be integrated into IBM. The software will be folded into IBM's line of application and integration middleware. The deal is expected to close later this year.

"Coremetrics expands IBM's business analytics capabilities," said Craig Hayman, general manager of IBM's application integration middleware business. Using "a cloud-based delivery model," Coremetrics helps its customers "get real-time insight into their interactions with their consumers and prospects," through e-mail and social media outlets, he said.

Overall, IBM sees analytics as a growth area for the company.

In the past five years, IBM has invested $11 billion to beef up its analysis capabilities through 18 acquisitions, and now has 5,000 employees devoted to providing analytics services. Coremetrics is the 90th acquisition for the company since 2003, Hayman said.

Forrester analyst Joe Stanhope said the purchase was a smart one on IBM's part. Coremetics is one of a small number of large Web analytics firms, one that has focused on serving retail customers. "The company has a great reputation and good product," he said.

In the announcement, IBM noted that the Coremetrics analytics capability will be integrated with the company's WebSphere application server. Stanhope said he would like to see the company also apply some of its business intelligence capabilities, such as the company's Cognos software, into refining some of marketing data collected by the Coremetrics software.

"That would be interesting," he said.

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