Judging from the deals, social media for business is moving from start-up to establishment faster than you can tweet “buyout.” Several billion dollars have been spent on mergers and acquisitions in the sector over the past several months, with no sign of letup.
On Tuesday Oracle purchased Involver, a company that makes software for a nontechnical person to build a complex corporate page on Facebook and other social media. The price was not disclosed. Earlier in the week Salesforce.com purchased, also for an undisclosed sum, GoInstant, which enables people to browse Web sites together.
It was Oracle’s third big social media purchase this year, and the seventh by Salesforce since March 2011. Among the notable deals, in May Oracle paid a reported $300 million for Vitrue, which also makes social marketing software, and a day later Salesforce paid $689 million for a social marketing business called Buddy Media. In June Microsoft said it would pay $1.2 billion for Yammer, a kind of Facebook for use inside the corporation.
It is a fast adoption of a new business tool, particularly compared with the other hot trend, cloud computing. While cloud took years to gaincorporate credibility, social media, which is often delivered through cloud-based systems, is selling fast.
Social media is particularly attractive for marketers, since hooking product information up with consumers enables them to elicit and observe behavior better. That enables them to make and sell products more effectively.
The interest in social media has also affected the publicly held companies. Jive Software, a publicly-traded business similar to Yammer, saw its share price rise 14 percent after the Microsoft acquisition. Bazaarvoice, an online customer ratings and review service that went public last February, in May used some of its proceeds to purchase competitor PowerReviews for $151 million.
“It’s nice for our sector to be validated, a lot faster than we expected,” said Patrick Salyer, chief executive of Gigya a company that acts as an intermediary between corporate Web sites and social media like Facebook. For people in the social media business, he says, “what you are seeing is more notable than the Facebook I.P.O. Enterprise companies are getting into social in a big way.”
It does mean that the wide-open start-up days of social media in business are probably over, and we’re starting to head toward the standardization that tends to happen when big companies get involved.
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