Experian Buys CheetahMail, Aims to Boost DM Services

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Database marketing and credit reporting service Experian expanded its offerings with the purchase of CheetahMail Inc., a New York e-mail marketing services firm that competes with DoubleClick, Digital Impact, Responsys and Bigfoot Interactive.

The acquisition is designed to help Experian, Costa Mesa, CA, bolster its direct marketing services, particularly in aiding clients in sending more highly targeted e-mails to their opt-in subscriber lists. Terms of the deal were not disclosed.

"I think it gives us more scale in the e-mail marketing arena," said Deborah Zuccarini, president of Experian Marketing Services, Schaumburg, IL. "It allows us to accelerate the integration of our e-marketing and CRM platforms."

The acquisition comes three years after Experian bought Exactis, another e-mail marketing services firm.

For CheetahMail, privately held before the sale, the deal was born of necessity.

"E-mail is just one more limb in the multichannel marketing body, and for CheetahMail to grow, it was extremely important to find a partner that was as strong on the data side as we're in e-mail," said Irene Pedraza, CheetahMail founder/CEO.

CheetahMail's acquisition comes in the same week DoubleClick announced plans to buy SmartPath, whose software helps marketers and ad agencies manage the operational aspects of marketing.

The recent acquisitions reflect renewed interest in online marketing. Forrester Research estimates U.S. online marketing will grow to $16 billion by 2008 from $7 billion last year.

Zuccarini said Experian was drawn by CheetahMail's position as one of the fastest-growing e-mail marketing firms in the United States and Europe -- a big plus for a suitor.

"E-mail distribution is a very rapidly growing section of our business and becoming increasingly important to our clients as part of their marketing mix," she said. "We believe it's a key component of our multichannel marketing offerings.

"They also have a strong client base in the retail, catalog and financial services industries, and that aligns with many of our key vertical markets. We very much like their technology, and it allows our clients to have better personalization and reporting capabilities."

Founded in 1998, CheetahMail offers e-mail delivery, creative, analytics and campaign and database management. Clients include ABC-TV, Neiman Marcus, InStyle.com, Dollar Rent a Car, The Discovery Channel, CompUSA.com, Starbucks Corp., Bloomingdale's, JC Penney and Wyndham Hotels & Resorts.

Claiming profitability since 2001, CheetahMail also has offices in Long Beach, CA, and a British subsidiary called CheetahMail UK in Surrey, England.

Keeping its name, CheetahMail will continue to run out of its New York head office as a separate division within Experian Marketing Services.

"We would be providing them with additional HR and legal support, and helping them craft a growth strategy and jointly offer a broader solution in terms of multichannel strategy," Zuccarini said.

Part of that growth strategy involves continuing to build CheetahMail's employee rolls.

"We'll be hiring more people, and some of those hires will probably come from [Experian's] employee base," Pedraza said. "Our current staff remains the same. Management continues to run the company, and our technology is the e-mail marketing technology for Experian."

Owned by Britain's Burberry owner GUS PLC in Nottingham, England, Experian has four business lines in North America pinned on the use of data for marketing: credit services, marketing services, Experian Automotive and Experian Consumer Direct. The $2.2 billion company employs 13,000 people worldwide with clients in more than 60 countries.

CheetahMail's purchase begins a fresh move into new vertical markets and regions as Experian expands distribution channels.

"We're actively looking for the right acquisitions to complement our current businesses," Zuccarini said.


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