Lithium Acquires Scout Labs, Dips Toes in E2.0 Waters

Lithium (a client, don’t forget to mark that column in your log) acquired Scout Labs (a vendor specializing in Social Media Analytics and not a client).  The deal was estimated at around $20MM (not that makes any difference, but am reporting the news here), and is expected to overcome all FTC objections (not that they would get involved, but again – reporting the news).

This is a terrific move by Lithium (and I would say the same if I did not tell them some time ago to do something like this, not that they would listen to me on these matters) and it positions them very well in two markets – for different reasons – and prepares them for an interesting convergence play.

As far as the SCRM market is concerned, they are growing their presence by acquiring the second of the four modules they will need to become a complete SCRM application (communities, analytics, feedback management, system of record – more on this soon) and by distinguishing themselves from the rest of the communities and analytics vendors in doing so.  In view of the recent spate of acquisitions in this market (such as Attensity acquiring Biz360, Jive acquiring FiltrBox, and RightNow Technologies acquiring HiveMind) this acquisition shows the commitment from Lithium to remain in the leadership position they have carved in the market.

However, most notably to me is that this makes them a very interesting play in the Enterprise 2.0 market. No, it is not heresy.  My view has been that these two market will converge eventually and that vendors will come from different sides to embrace the Social Business market (or whatever we will call it once we get there).

I wrote before that leveraging the content created on communities is one of the critical uses of analytics.  With this acquisition Lithium creates a very interesting combination of power bringing communities and analytics together, taking the first step towards creating actionable insights — the only purpose for building a SCRM (and Enterprise 2.0)  system.

Are they the first one to become a certified SCRM player? No, there is no one there yet (I said four modules, they have two as does everybody else — still room to grow).  However, they are the first ones to leverage communities as generators of content, feedback, and insights — and take the first step towards unlocking that power and converging SCRM and Enterprise 2.0.

Looking forward to what the world will make of this combined product (as soon as I can, I will talk to people taking on the combined entity and let you know).

disclaimer: as I said above, Lithium is a client and I am working with them on other projects (I am actually writing some interesting research on Social Media 102 – a part of which I am presenting at their conference later this week – Wednesday – and if you are attending, come see me and we can chat about it).  Even though they are paying me for that, they are not paying me to write this and to say they are cool, which they are, or to say that this was a good move, which it was as I acknowledged telling them before they had to do it.  These represent my visions and opinions on this market and this particular acquisition, and I stand behind it.  You, however, shouldn’t.  You should seek more information, read more, become better informed and then — and only then — make a decision on what to do. It is called due diligence, and it is a good idea as well as a career-saver.
image credit: massdistraction, http://www.flickr.com/photos/sharynmorrow/222401409/

5 thoughts on “Lithium Acquires Scout Labs, Dips Toes in E2.0 Waters”

  1. Yes, we’re on the route to convergence. For Social CRM startegies to be effective and bring about the desired outcomes for the company (more and loyal customers that advocate the brand – and better margins), the Enterprise needs to be organised to bring about customer desired outcomes through collaboration around and with the customer. Enterprise 2.0 concepts can play a key role in this facilitating this collaboration and getting the insights derived through customer engagement to the resources that can perform the actions that are required.

    I would say that Lithium Technologies is approaching the water, but they haven’t got their toes wet yet in Enterprise 2.0. The next acquisition (or partnership?) will tell us more about the direction they are heading in…
    .-= Mark Tamis´s last blog ..Data-Driven Social CRM =-.

    1. Mark,

      Thanks for the read — I agree that this is too early to be called a fist step by some, but I do think it paints the path (dips the toes, tests the water) to the convergence.

      Too early to tell? yes, but i am encouraged that some vendors are realizing it. Did Lithium enter this M&A for this reason? Probably not, they simply had the SCRM model in mind. But, once the foundation has been laid, there is a possibility — and that is what is encouraging to me.

      Thanks for the great comment!
      Esteban

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