Allegiance has made a pledge: The vendor promises to perfect the capture of the Voice of the Customer (VOC), innovating and acquiring its way to the goal. Today the company takes one step further on that path with its acquisition of Inquisite, an Austin, Texas–based provider of online-survey management solutions. Financial terms of the deal have not been disclosed, but it comes fast on the heels of Allegiance's sale, just a few weeks ago, of its ethics-reporting unit SilentWhistle -- the software upon which Allegiance was founded.
The timing of the two deals is no coincidence. According to Allegiance executives, the June sale of SilentWhistle to Global Compliance generated the capital required for the purchase of Inquisite -- and further demonstrates Allegiance's commitment to its enterprise feedback management (EFM) product set.
"We had been actively looking for the right company to acquire to accelerate our efforts for about a year," says Chris Cottle, Allegiance's vice president of marketing. "When it comes to simple features within a robust survey product, we liked what we saw in Inquisite." What Allegiance liked, Cottle says, was not only Inquisite's strong survey tools, but also its strengths in the areas of campaign management, list management, and sample management -- all necessary offerings for market researchers.
"This is a pretty astute acquisition," says Ed Thompson, an analyst at Gartner. The EFM space is quite crowded, he says, with Gartner tracking approximately 180 companies active in the market. However, he points out, there are only a handful of enterprise-level vendors -- ones that cater to multiple channels and provide consolidated platforms rather than point solutions. With this acquisition, Thompson notes, Allegiance is gunning to become one of the leaders on the enterprise landscape. In fact, according to information provided by Allegiance and Inquisite, enterprise customers such as Dell, Visa, AT&T, and Marriott are already users of Inquisite's self-administered survey tools.
"This puts us right at the top of the pack in the U.S. market," Cottle says, adding that he hopes the acquisition will help Allegiance create an international presence as well. "You need to have a very broad offering that appeals to large enterprise VOC customers." Today's EFM clients, he notes, need a vendor that not only provides technology for solicited surveys, but is also capable of managing the kind of unsolicited feedback often found in comments and complaints. Users also need real-time access to data, robust analytics, a single listening platform that's affordable, and professional services, Cottle says.
Thompson agrees that depth and breadth are critical for any vendor hoping to lead the EFM space. In fact, he says that the depth of functionality that enterprise customers are beginning to demand will likely lead to a significant amount of near-term merger-and-acquisition activity.
"This won't be the only acquisition that [Allegiance makes]," Thompson predicts. "[And] competitors will be acquiring, as well."
Cottle implicitly acknowledges the accuracy of Thomspon's prediction, calling the Inquisite purchase Allegiance's "first move on the chessboard." He notes, however, that this deal -- and any that may come later -- won't preclude Allegiance from pursuing its own technological advances. "Product innovation is [the] key to success," Cottle says. "We've got the largest development team of any competitor."
While Allegiance has its roots in the midmarket, Cottle says the company has seen a lot of success in the enterprise market in the last few years. Thompson notes that Inquisite's base of big-name vendors should keep Allegiance moving upstream.
Thompson says he expects Allegiance to need a year or two to successfully integrate Inquisite's survey tools. In the meantime, however, the analyst suggests that Allegiance beef up its process and workflow capabilities. "The battleground won't be on data-collection channels, [where Allegiance has] a fairly full set," he says. "[Allegiance] could improve on the analytics side, but it's unlikely [it] will beat someone like SPSS or SAS. If [Allegiance is] going to beat those big guys, then it should be largely on vendor process and workflow and alerts and escalations and routing."
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