HP buys Exstream Software, focuses on VDP potential
Variable-data printing and one-to-one marketing haven't been exploited to their full potential, according to Hewlett-Packard, which has signed a definitive agreement to acquire Exstream Software. The deal is expected to close in March.
“We're still in the early stages of companies learning how to communicate more effectively with customers,” said David Murphy, SVP of HP's imaging and printing group, adding that HP wants “to expand this category very quickly.”
By combining its technology with HP's printing market position and customer base, Extream's goal is to be able to bring these solutions to more markets in a quicker time frame. It believes that there is more rich media and rich publishing that can be delivered via VDP that isn't currently taking advantage of the technology, according to Murphy.
“There's a lot of value-add that we can bring to the financial services and insurance industries in transpromo because the guys that have done it well so far are rare,” he continued. Transpromo documents combine transactional documents like a credit card statement with relevant data — such as a cross-sell promotion based on a recent purchase — to create a more personalized document that functions as a marketing vehicle as well.
Another area where HP sees opportunity to expand the use of VDP is in the retail industry. “Most major retailers do generic circulars, generic couponing — nothing that is truly innovative,” Murphy said, adding that few have tailored their customer communications using demographic and other relevant data.
However, HP sees the potential to apply Exstream's technology across many verticals. “The fact that Exstream has several hundred customers and doesn't have a single vertical” that it is dominant in was appealing to HP, Murphy said. “We're an enterprise global business and we want to serve multiple verticals.”
Upon completion of the acquisition, Exstream will be integrated into the Web services and software business unit within the imaging and printing group of HP. In fiscal year 2006, the imaging and printing group accounted for 29% of HP's overall revenue.
Exstream customers include American Express, Charles Schwab, Aflac, the US Department of Education, Con Edison and Carnival Cruise Lines. It provides enterprise software products that streamline document creation processes and produce personalized communications of all types of delivery through print/mail and online channels.