Boom Boom Pow.

Salesforce, a purveyor of cloud-based solutions for customer relationship management (CRM) & collaboration for enterprise organizations and small businesses announced that it is acquiring social media monitoring platform Radian6 for $276 million in cash and $50 million in stock. Radian6 is used by more than half of the FORTUNE 100 and companies like AAA, Dell, GE, Kodak, Molson Coors, Pepsico, and UPS to monitor, analyze and engage in social media conversation.

Chairman and CEO of Salesforce Marc Benioff shared his thoughts on the acquisition, “With Radian6, salesforce.com is gaining the technology and market leader in social media monitoring. We see this as a huge opportunity. Not only will this acquisition accelerate our growth, it will extend the value of all of our offerings.”

With this acquisition, Salesforce is doubling-down its business strategy to boost the “S” in the socialization of CRM (sCRM) and help businesses integrate the social customer into its customer relationship management methodologies. The social customer is forcing businesses to adapt processes and systems as their behavior as well as their needs and expectations are evolving along with their use of social networks such as Twitter, Facebook, YouTube, Blogs, et al.

Consolidation is in the air. With this Salesforce/Radian6 deal, Lithium’s acquisition of ScoutLabs and MarketWire picking up Sysomos, we can expect to see businesses place greater importance on the social customer outside of marketing and communications. As my colleague at Altimeter Jeremiah Owyang observed in a recent report, almost 50% of social media programs live inside of marketing today. In order for a business to become a social business, it requires the creation of bridges between business functions and social customers and bridges between existing silos.

Salesforce’s acquisition of Radian6 clearly places a great importance on monitoring into what Jeremiah refers to as the social business stack. Additionally, the integration of monitoring into a business is the first step toward a long road of change. For the most part, monitoring and analytics services are used to track the state of social for the brand as well as the efficacy of its campaigns. The social business will use monitoring to introduce relevance into the business mix to adapt to the needs of customers internally and externally through a virtuous cycle of…

1. Listen
2. Learn
3. Engage
4. Adapt
5. Repeat

The Salesforce acquisition of Radian6 demonstrates the importance of social activity to create a new framework for a new generation of business. It’s more than technology, it’s not equally about philosophy and social science. With each day that passes, social media plays a greater role in the shaping of customer experiences throughout the entire life cycle.

UPDATE: My Altimeter colleague Susan Etlinger adds additional perspective to the discussion, “Salesforce.com acquires Radian6: Implications for the Social Analytics Market.”

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