Constant Contact Buys Social CRM Developer

Constant Contact on Wednesday announced that it has purchased social CRM provider Bantam Live for $15 million in an all-cash deal.

The acquisition adds customer relationship management software to Constant Contact's online marketing mix. Though it traces its roots to email marketing, the company has integrated social media and other digital channels with its platform over time. Constant Contact has more than 400,000 customers, almost all of them small businesses -- a segment that CEO Gail Goodman said is especially well-suited for social media marketing.

"We think the quality of their relationships and their focus on customer service and customer experience gives [small businesses] a bit of an unfair competitive advantage on social media," Goodman said in an interview. "Their customers actually feel connected to them -- excited and interested in participating."

Adding a social CRM backbone was the next logical step in the evolution of Constant Contact's online marketing services, particularly as channels like email and social become increasingly interwoven.

"There aren't any boundaries anymore," Goodman said. "There will be a single, integrated platform that shows small businesses all of their contacts and connections across all channels over time."

To that end, while the phrase "social CRM" is appropriate for Bantam Live's features -- which include both contact management and social profile management, among others -- the software will be used to track and manage data across multiple marketing tactics, from survey responses to email opens and clicks.

"Social CRM helps us give our customers that view across all channels of customer engagement, and the power of social engagement to help drive social word of mouth," Goodman said. "[Bantam Live] will literally become the core contact management system for all of Constant Contact's products across all channels."

The flexibility of terms, so to speak, is fitting for another reason: In Goodman's view, smaller businesses and the vendors that serve them often don't use the same vocabulary.

"Not many of our customers would say: 'Boy, we really want social CRM,'" Goodman said. "But we've been hearing constantly that our customers want an integrated view into all of their customer interactions, and that social has become an increasingly important channel of interaction for them."

Bantam Live's platform was built on Ruby on Rails. Stefan Piesche, Constant Contact's chief technology officer, said in an interview that the company could have developed its own CRM tool, but that time-to-market won out in the buy-versus-build debate.

"[Bantam Live has] done such a great job on not only the technology itself but on the product features that our customers need," Piesche said. "We really felt that this was a unique opportunity to take those features to market much sooner than we could have otherwise."

Bantam Live's current customers -- which number in the "low hundreds," according to Goodman -- will reap an immediate benefit from the deal: They get to use the software they'd been paying for at no charge for the time being. Meanwhile, Constant Contact will not accept new Bantam Live customers as it integrates the software with its own platform. Bantam Live was removed from the Google Apps Marketplace as a result of the deal.

Though Goodman said that Constant Contact's long-term product strategy for its new acquisition is still to be determined, she sees CRM more as a core service rather than an up-sell. "At the moment, we're not anticipating that an email marketing customer would have to pay more to be able to see how those same email marketing recipients are engaging in the social channels," she said.