RMP Media Analysis

Data is Gold…Twitter Acquires GNIP

In PR Vendors, Products on April 16, 2014 at 12:59 pm

Photograph: Iain Masterton/Alamy via theguardian.co.uk

“There can be only ONE.” This line from the Highlander series is what popped into my head when I saw GNIP (pronounced guh-nip) had been acquired by Twitter. Why you ask? Well in the Highlander series there could only be one immortal and at this rate there might end up being only one source for Twitter data. Twitter. Let me explain.

As of right now there are only four companies with licensed access to the Twitter “fire-hose”. If your software has a Twitter component that is billed as the “full Twitter feed”, “Twitter firehose”, “all of Twitter” or any other permutation you can think of it comes from one of four vendors: GNIP, Datasift, Topsy or NTT.

With Twitter’s purchase of GNIP there are only two independent firehose providers: Datasift and NTT. Topsy was acquired by Apple in December 2013 for $200M. This makes me think GNIP was purchased for something in the same neighborhood.

The power behind GNIP is it’s access to the historical Twitter data as well as the full Twitter firehose. Data is delivered to third party vendors via API who can then server up the data to suite their market. GNIP though provides exclusive data from FourSquare, StocTwits, Disqus,  and estimize along side the full Twitter firehose, Facebook, del.icio.us, Flikr, Google+, YouTube, Tumblr, WordPress,  Bitly, Instagram, Reddit, vk,sitrion, intensedebate, Photobucket, PLURK, stackoverflow, vimeo, Panorami, metacafe and Dailymotion. That is a very well rounded offering that serves public relations and marketing monitoring needs for the most part. When Pintrest gets added then you will hear a collective Woop!

“Gnip says that working with Twitter as a part of the company will let it “go much faster and much deeper,” and they plan to expand support to include a wider set of potential use cases in different industries. “(Etherington, 2014)

What happens to Twitter access regarding DataSift, NTT & Topsy?

Twitter says that all customer contracts will be honored, but the real question is for how long? By bringing the data in house Twitter is establishing another battlement in the advertising $ war. Twitter will be in direct contact with the market and more profit will flow to the bottom line.

Through a blog post on Tuesday  Jana Messerschmidt, VP, Global Business Development & Platform at Twitter stated: “We believe “Gnip has only begun to scratch the surface. Together we plan to offer more sophisticated data sets and better data enrichments, so that even more developers and businesses big and small around the world can drive innovation using the unique content that is shared on Twitter. We will continue making our data available to Gnip’s growing customer base.” (Messerschmidt, 2014)

“It is understood that Apple’s acquisition of Topsy raised red flags at Twitter HQ. Twitter relies on its ecosystem of data resellers, however small. With one of its few data resellers in the hands of Apple, it made sense for Twitter to bring a big data company in-house. The company needs to protect its interests and keep the remaining few data resellers out of the hands of competitors. The other option would be less attractive: If Gnip and Datasift were acquired by competitors, Twitter would have to scramble to build out comparable big data infrastructure itself. ” (Griffith, 2014)

GNIP’s competitors will now be at a disadvantage because once the acquisitions closes there is no telling what will be honored. Will GNIP continue to have a Facebook feed after the acquisition? – doubtful. Will DataSift and Topsy continue to have a full firehose feed from Twitter – extremely doubtful. Strategically speaking Twitter will want to own the access point in full. Will Twitter purchase NTT? That will require a bit more thought, but as a global strategy, why not?

References:

Etherington, D. (2014). Twitter Acquires Longtime Partner and Social Data Provider Gnip. Retrieved from http://techcrunch.com/2014/04/15/twitter-acquires-longtime-partner-and-social-data-analytics-provider-gnip/

Messerschmidt. (2014). Twitter Welcomes Gnip to the Flock. [Blog Post] Retrieved from https://blog.twitter.com/2014/twitter-welcomes-gnip-to-the-flock

Griffith, E. (2014). Twitter plays defense with deal for Gnip. Retrieved from  http://tech.fortune.cnn.com/2014/04/15/twitter-plays-defense-with-deal-for-gnip/?section=magazines_fortune

GTCR Math: Vocus Plus Cision Equals…

In General Analysis, PR Vendors on April 9, 2014 at 12:59 pm

Usually an acquisition generates questions that we can all see coming a mile away because the move is  readily apparent. The synergies are right there on the table and there is no mistake; it could be to break into a new market, to expand into an existing market, to enhance current service offerings with complimentary products or dominate market share.

There were whispered conversations over the last year that both Cision and Vocus were looking to sell. This came out into the light in Q1 this year and almost as quickly they were both snapped up by GTCR.

When the two heavyweights in Public Relations software solutions arena are owned in whole or in part by the same PE though the questions surrounding the acquisition become very pointed.

This got me thinking about GTCR math.

VocusPlusCision

Let’s start with Vocus: shareholders* were doing back flips when the all-cash transaction was announced April 7th at approximately $446.5 million. This represents a premium of 48% over Vocus’ closing share price on April 4th. GTCR sees something here.

Compared that to the Cision bid from Blue Canyon Holdings (sub of GTCR) of 20.1 per cent of shares and votes in Cision along with Fairford Holdings Finance AB, Cyril Acquisition AB, Lannebo Fonder and Accendo Capital SICAV-SIF with 43.3 per cent of shares and votes in Cision for a grand total of 63.4 per cent of shares. The total bid is approximately $125.7 million.

So What Happens Now?

$446.6M + $125.7M = Over half a Billion, that’s Billion with a ‘B’ invested in two companies with some very similar offerings and a huge part of the market share in the same.

Vocus clearly comes out on top nearly doubling their valuation. Kudos to them for swinging such a high price. This was achieved in large part due to the iContact acquisition made in 2012 for $169M which has been instrumental in Vocus’ pivot to the cloud marketing space. Cision on the other side of the equation is priced much more reasonably, albeit with a less diversified offering, and kudos to Blue Canyon Holdings on their savvy purchase.

Vocus sees it this way: “For our shareholders, this agreement provides an opportunity to realize cash value for their shares at a significant premium to historical share prices,” said Rick Rudman, CEO of Vocus. “For our employees and customers, we believe that joining forces with GTCR creates a significant opportunity to utilize each other’s strengths and move even faster toward our vision of creating innovative software and making our customers successful.”

Cision has remained tight lipped so one can only speculate. It’s obvious Meltwater’s offer is a no go at this point, and it doesn’t appear that Cision wanted that marriage anyway. Although it would have been a fantastic move on Meltwater’s part had it been successful.

Customers

In the near term (next 3 months), nothing really changes for the customer base. Once everything is finalized though customers will be offered to move to the “new solution” and given the benefits and incentives customary with such a change. With limited options of other comparable platforms it is highly likely they will renew their subscription. Where there may be some drain is on the lower usage and lower budget clients who may opt to go with a product that focuses on a targeted part of their workflow.

Employees

The very word acquisition gets all employee’s thinking “What happens to me now?”. Those resumes are getting updated, LinkedIn recommendations are going to get requested, suits are going to need pressing and interviews will begin. The hard fact is not everyone survives the acquisition. In this case anyone working in Sales, Support, Development, Training, Professional Services, Research, well pretty much everyone has a target on their back. Don’t think so? Take this into account. When Vocus purchased iContact in February 2012 one-third of the 250 iContact employees were pink-slipped  only 10 business days later. It was all about redundancies and Vocus increased the quota carrying sales reps to 489 by year end compared to 270 the previous year which was core to the cloud marketing  suite go to market strategy.

The Industry

Here is what the numbers tell us if these two are combined. The Contact Management space would be dominated and the Monitoring space could easily overtake Meltwater with a bit of innovation and salesmanship.

From where I sit the fact that one company will own the two largest PR software companies means there will be a only one version of both standing when everything settles. The logical outcome is to pull apart those successful components from each and create the defacto PR solution. Now if GTCR still has an appetite and really wants to close this market up all they need to do is pick up PRNewswire to round out the offering and fund some further investment into the social media engagement/listening/monitoring component.

Vocus’ cloud marking suite would offer the growth that can no longer be found in the PR space. PR has changed and the budgets that support the PR effort are increasingly under the Marketing P&L. This doesn’t mean PR’s don’t need a tool for their workflow, it just means that the workflow offered has to take Marketing and PR into account in that order.

 

*I own a handful of shares in Vocus from way back when I worked there.

5 Predictions About Influence Marketing

In General Analysis on April 2, 2014 at 9:13 am

Gina Gulberti of Augure, recently interviewed me for a post she was working on regarding Influence Marketing, read it here. A fantastic cross-section of marketing experts (talk about being in great company!) were interviewed for the piece which makes for good reading :

Augure’s defined mission is to “provide PR and communication professionals with a software to help them Understand, Identify, Improve and Measure their efforts” and is based in Europe. With 1,500 customers and over 20,000 users  and 96% of their customers renewing their subscription each year Augure is poised to make a big impression here in the US in the near future.

Here is my full interview:

How are new online Influencers (bloggers or Tweeters) changing PR professionals dynamic?

The dynamic between traditional PR practitioners and online influencers has been evolving on an almost equal footing with social media usage. PRs and Marketers recognized that social media is the most effective platform with which to communicate with their publics thereby engaging in a participatory conversation.

The online influencers are a valuable resource for the PR’s  company. They are a primary component of earned media, which is a PRs domain. The dynamic for the PR doesn’t change at all from the journalist dynamic. The journalist is paid to write and while they should be objective, that is not always the case. Online influencers aren’t paid, they don’t have a stake in the company, they aren’t influenced by deadlines or editors. The online influencer should have the same access to PRs. The successful PR will have to take the time to identify key online influencers and cultivate relationships with them.

How can these influencers be of help to their brands?
Influencers can help promote or damage a  PRs and Marketers brand. The fact that they typically do not have a stake in the brand, but perhaps in the industry, the public put more stock in their viewpoint.

Is the Influencer Marketing measurable? How?
The benefits of influencers is measurable just the same way traditional efforts should be measured and evaluated. The ability to link the results of media efforts earned and otherwise to business goals and outcomes. Establishing a strategy that is in line with the company goals makes this an effective way to demonstrate success and areas that may need refinement.

5-predictions-about-influence-marketing-infographic1

Follow

Get every new post delivered to your Inbox.

Join 28 other followers

%d bloggers like this: