Salesforce Acquires ExactTarget for $2.5 Billion

ExactTarget allows companies to automate their marketing efforts.

Salesforce will acquire ExactTarget, which builds marketing software, for $2.5 billion.

Salesforce is currently on an acquisition sprint, having snatched up at least seven companies since May 2012, and CEO Marc Benioff told analysts and reporters on a conference call that the company would take “a vacation from M&A for anywhere between probably 12 and 18 months.” If so, Salesforce is leaving for its self-imposed break on a high note, as ExactTarget represents its biggest financial acquisition ever.

Salesforce plans on merging ExactTarget’s digital-marketing assets with its cloud-based CRM and cloud platforms. In theory, that will better serve Salesforce customers by giving them access to more marketing-automation tools, including ones built for social networks.

That’s not to say Salesforce doesn’t have a presence in online marketing; in April, the company released an app designed to help companies—especially marketing agencies—better manage “social advertising” with data from Facebook and Twitter. The app, Salesforce, incorporated assets from Buddy Media, the social-marketing firm that Salesforce purchased in 2012 for $689 million.

Assets from Buddy Media (and Radian6, another acquisition) also become part of Salesforce’s Marketing Cloud, which made its debut in 2012. Marketing Cloud allows companies to manage presence across social channels, measure engagement, and precision-target social advertising. According to Salesforce, ExactTarget assets will also end up in the Marketing Cloud.

Salesforce faces some stiff competition in the cloud arena. In mid-2012, Oracle snatched up a startup, Vitrue, with an eye toward becoming more of a player in cloud-based social marketing. Microsoft, SAP, and other IT firms have also launched software that makes work environments more collaborative and social; it stands to reason that, as their respective business-cloud platforms evolve, each will take more of an interest in tools for monitoring and marketing social media.

Salesforce expects the ExactTarget acquisition to increase its total revenue in its fiscal year 2014, but the company conceded that integration costs, transaction fees and other factors would lower its non-GAAP earnings-per-share.

It’s been a big day for tech acquisitions so far: in addition to Salesforce buying up ExactTarget, IBM announced that it would acquire SoftLayer Technologies, a massive cloud-computing infrastructure provider, for an undisclosed sum; an unnamed source told The New York Times that Big Blue had paid out roughly $2 billion.


Image: ExactTarget