Xchange Acquires CustomerAnalytics

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Xchange Inc., Boston, the customer relationship management vendor, said yesterday it acquired software and services provider CustomerAnalytics, Dallas.


Under the terms of the agreement, Xchange, Inc. will issue approximately 5.2 million shares of its common stock and stock options to existing holders of CustomerAnalytics common stock and options. The transaction will be accounted for as a purchase


Upon completion of the acquisition, Xchange will integrate CustomerAnalytics' front-end planning application -- called EnAct -- into its eCRM solution suite Xchange 4.0, which offers campaign management, customer analytics, e-mail marketing and Web personalization. EnAct will also be sold as part of the Xchange 4.0 solution suite or as a stand-alone product


CustomerAnalytics' EnAct is a planning application that provides front-line customer contact personnel with customer information as well as methodology and tools for using the information to build profitable customer relationships. Xchange 4.0 combines software and services that enable businesses to personalize and coordinate online and offline customer communications to earn a greater share of each customer's business.


As a result of the acquisition, Xchange will now enable click-and-mortar companies to:


* Analyze profit opportunities and execute and measure marketing offers and campaigns in a local office, branch or outlet;


* Close the loop between centralized and local marketing, by recommending the best tactics at both the local point of customer interaction and the centralized corporate level to make each customer relationship more profitable, and then tying information, results and feedback gathered at both levels back to a central data warehouse;


* Target and deliver proactive and reactive personalized communications across every possible customer touch point (e-mail, call center, Web site, direct mail, face-to-face interactions);


* At the local and centralized corporate level, identify who to target (based on profitability potential), what to offer and how to best execute that offer.


Andrew Frawley, CEO, Xchange, said that EnAct will round out Xchange's offerings and fill a great need in the eCRM space, by creating a planning tool for local customer interaction that can be integrated back to the centralized single customer view at the enterprise level.


"Our experience suggests that typically 60 percent of a company's marketing is centralized and the other 40 percent occurs at a more local level," he said. "Companies using CustomerAnalytics solutions report annual returns of 200 percent, as their point-of-customer contact personnel consistently earn more of the customers' business and loyalty through understanding who their most profitable customers are and what their motives are to buy."


Upon completion of the acquisition, more than 100 employees will be added to Xchange bringing the total to nearly 450. The acquisition is also expected to boost Xchange's client base by 110.


CustomerAnalytics, which had revenues of $17.7 million in 1999, CustomerAnalytics client base of leading companies includes 25 of the world's top 100 financial services institutions, among them: Abbey National plc, FleetBoston, Wells Fargo, Liberty Life Insurance, ABN AMRO/LaSalle, and Canadian Imperial Bank of Commerce.


CustomerAnalytics' CEO Robert Hall will become Xchange's Chief Strategy Officer.
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