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Wilkommen, Bienvenue, God Dag, RichRelevance

May 21, 2013

Who Needs Who? RichRelevance acquires Avail. –Busy Bee by Benson Kua from Toronto, Canada, via Wikimedia Commons

On May 13, RichRelevance acquired Avail. This is very good news for RichRelevance. The combined company is now global, with customers in 29 countries. It is Numero Uno for personalization solutions in Internet Retailer’s rankings for USA and Europe.

RichRelevance, founded 2006, is the leader in North American retail, serving a billion recommendations a day. Avail, founded in 2001, is the leader in Europe and the most mature recommendations provider. In recent years, Avail has been represented in the USA by partners such as Venda, while RichRelevance has opened offices in the UK, France and Germany.

Breaking into each others’ markets is a tough challenge that requires very different resources. In Europe, word of mouth is key to success: customers want to hear from someone in their country that a solution has been successful. US companies are viewed with considera-ble skepticism. In the USA, relentless marketing campaigns are de rigueur in getting customers’ attention and convincing them you have the resources to succeed. A US marketing budget is unbelievable to Europeans, resulting in an emotional and financial barrier that is difficult to breach. I was aghast to hear one CMO say, “We don’t need marketing, we have great technology.” His US launch was, no surprise, a total failure.

The acquisition of Avail gives RichRelevance the European relationships it needs. “This acquisition rounds out our ability to support the complete topography of our retail partners’ needs in the EU and across the globe.” said David Selinger, chief executive of RichRelevance.

The companies have similar offerings for retailers, providing recommendations across multiple touchpoints, ad placement, and targeted advertising to site visitors. The move into targeted advertising, which enables retailers to monetize non-converting traffic by selling ad impressions, is recent for Avail.

While the offerings are similar, there are important technical differences. Online European retailers often operate in multiple countries, creating a host of requirements that a US solution doesn’t need to address. In addition to managing recommendations across languages and currencies, there are complex shipping costs and regulations which impact how recommendations should be selected in various markets. Controlling the behavior of recommendations across multiple sites really requires a hierarchy of rules and overrides: global rules that apply to all sites; rules that apply within a country; rules that apply to a site; rules that apply to an international segment, etc. Avail makes it easy for customers to take control with minimum cost and risk. In addition, Avail was the first to pair people with similar interests for BazaarVoice, and is unique in supporting both collaborative and syndicated merchandising. So there is useful technology for RichRelevance to incorporate, when it tackles the technology merger of the two companies.

The impact on customers is as usual in an acquisition: Avail’s customers will worry (midst ardent reassurance from RichRelevance) about continuity of support for their retailing efforts. As is usual, key talent will leak out of Avail and RichRelevance will backfill as finance and available talent allow. On the plus side, RichRelevance is now an even larger and theoretically stronger company and thus in better position to support customers.

The impact on the market is to again reduce the pool of talent and technology, and make it yet more difficult for smaller companies to thrive. Recent mergers include PredictiveIntent by Emailvision, Fredhopper by SDL, iGoDigital by ExactTarget demonstrate the attraction of the technology and expertise, as well as the challenge of achieving financial stability.

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