IBM has snapped a cloud based analytics firm, DemandTec, for $440 million as it aims to get a bigger slice of the lucrative commerce market.
Big Blue has talked up the big bucks it can earn through analysing pricing strategies with what the PR department calls Smarter Commerce. And we are not just talking about Rodney Trotter’s one O-level here. DemandTec’s software can, IBM says, provide valuable insights into pricing trends, and that has led IBM to claim the software market could be worth $20 billion.
DemandTec’s cloud-based software can give price, promotion and marketing analytics, with immediate responses to check strategies. With business needing to be ever more responsive DemandTec and IBM reckon that firms will pay for the ability to check consumer information and spot trends, and change their prices according to data.
Essentially IBM thinks that is offering a service that turns pricing when flogging goods into a “science” rather than using intuition, or, as it is known outside the business world, guessing how muchy you can get people to pay.
DemandTec already has around 450 customers variously in retail and manufacturing industries, and has a number of patents covering pricing and promotion analysis.
The firm will now be integrated into IBM’s Software Group, and will expand its Software as a Service (SaaS) cloud offerings.