Why Intuit Buying Demandforce is Good For Your Business
Small businesses using Intuit products should be really excited about the recent acquisition of Demandforce by Intuit for nearly a half a billion dollars. Demandforce specializes in automating marketing and customer communications for small businesses with their SaaS product D3, and since the acquisition was led by Intuit’s small business group, you can bet that this technology will be applied as another tool in the arsenal of small businesses.
Intuit is positioning itself to become a one-stop shop for small busisness. Marketing is a HUGE challenge for small businesses, I would argue more so than accepting credit cards, so an acquisition of a company that will allow small businesses to efficiently manage their marketing and customer communications will be a valuable tool in the belt of QuickBooks customers.
The customers have to walk in your door before they give you money. They have to visit your site before they become a subscriber. If your company is compromising on the quality of its communications and not utilizing all of the available avenues your potential customers use find your product, you are leaving some serious money on the table.
If you’re a business owner, I’m sure you realize this is a big problem, and you’re not alone. According to a semi-recent survey by Deluxe:
“49% of small business owners claim that effectively reaching customers with limited resources is their biggest challenge. This is more than twice other key challenges cited: managing the costs of doing business (19%) and securing credit (12%). Their biggest frustration about marketing: They don’t know if what they are doing is effective.”
That definitely seems like an area worth addressing if you’re Intuit.
Now, if your eyes didn’t pop when you saw the deal is for $424 million dollars, go back to math class because that’s a lot of money. To put that figure in perspective, Cisco bought Linksys for about the same price in 2005. Granted, a half a billion doesn’t go as far as it used to, but with this acquisition, Intuit is claiming Demandforce is worth about the same amount of money than the company that manufactures a product which nearly every internet-wired household contains; a Linksys router.
So what does this mean? It means Intuit expects to provide some serious value to small businesses with this purchase. D3 could be a very valuable tool for small businesses using QuickBooks that are finding themselves compromising on their marketing and support communications. The deal is expected to close in May so we can probably expect the next Demandforce iteration to be integrated into Intuit’s Small Business Lineup by late 2012, early 2013, but that’s just a complete WAG.