Boston social marketing company BzzAgent has been acquired by dunnhumby Ltd., a shopper data unit of U.K. retail giant Tesco, in a deal that underscores retailers’ growing interest in social media.
The transaction, under which BzzAgent will operate as a stand-alone business, is valued around $60 million to the company’s senior management and investors, said sources.
BzzAgent uses word-of-mouth recommendations to drive brand sales and was founded in 2001 by Dave Balter, who will remain CEO and will also join dunnhumby's executive team. Dunnhumby is behind Tesco’s Clubcard loyalty program and helps retailers create shopper-marketing programs through analysis of consumer buying behavior. Balter said he first contacted the U.K. firm as a way to increase BzzAgent's 'agent' base, beyond its current base of 800,000, and to utilize dunnhumby’s targeting and analytical capabilities to add scale and better measurement.
"They want to be more social; we want access to their customer base,” he said. “Consumer loyalty leads to advocacy which leads to loyalty."
BzzAgent works for marketers like Procter & Gamble, L’Oréal, and Michelin. Dunnhumby was founded in 1989 by husband and wife team Edwina Dunn and Clive Humby. In addition to Tesco, the international firm works for other companies like The Kroger Co., Procter & Gamble, Shell, Coca-Cola, and Mars.