Pitney Bowes – Business Insights Conference 2011

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Jun 16, 2011

InfoTrends was invited to Pitney Bowes Business Insight’s (PBBI) annual Business Insights Technology Analyst Conference last week, where key executives (including Pitney Bowes’ Chairman and CEO Murray Martin) provided the latest strategic directions, news, and product updates from the company.

With nearly 90 acquisitions since 2001, Pitney Bowes has significantly expanded its portfolio, including the addition of comprehensive software solutions. With Customer Communications Management (CCM) as the central strategy for Pitney Bowes moving forward, the conference was focused on providing analysts with a detailed view of the various components of the value chain.

Customer Communications Management
Pitney Bowes defines CCM as solutions that aim to optimize the way organizations communicate with their customers. PBBI is spearheading the company’s effort in this area and offers enterprise-class products and services around data analytics, location awareness, document composition, and cross-media campaign management. It also has advanced capabilities in marketing analytics, such as predictive and behavioral analysis as well as uplift modeling.

Key Findings:

  • Although Pitney Bowes Business Insight (PBBI) represents less than 10% of Pitney Bowes’ annual $5.4 billion revenues, it is of strategic importance in its transition from an iron-heavy mailing equipment manufacturer into a leading CCM services and solution provider.
  • CEO Murray Martin noted that they will leverage their substantial free cash flow for additional acquisitions if they see the right fit to help them become a leading CCM provider.
  • Data analytics, predictive analysis, location awareness, and mobile services will be important growth opportunities for the PBBI group.
  • Software-as-a-Service plays an important role in Pitney Bowes’ software strategy and is seen as the main deployment method for bringing CCM to small-and-medium sized business.
  • Key challenges remain around evolving market perception, enhancing its competitive advantages for enterprise prospects, and integrating acquired companies in the overall PB structure.

InfoTrends’ Opinion
Pitney Bowes is a financially stable company that is using its free cash flow (almost $1 billion in 2010) to diversify into high-growth opportunities. On the PBBI side, data analytics is a key growth area because it is required in every step of the CCM value chain. While the strategic direction is clear, the question remains to what extent Pitney Bowes can leverage its existing user base to drive growth in this relatively new area for them. Since Pitney Bowes lacks the brand awareness (and size) of leading business analytic providers such as IBM, Oracle, SAP or SAS Institute, the obvious option is to up-sell existing customers. The issue here is that most of them are mailers or billers, not necessarily marketing executives or data analytics professionals.

The good thing for Pitney Bowes is that the volume of data generated by businesses and consumers is still doubling every 18 months. As a result, there is an increasing need to extract meaningful insights from those growing volumes of data, even for companies that have not been active in this before.

For Pitney Bowes, it is important to work on its positioning and explain how they differ from the larger vendors. They also need to increase the Pitney Bowes brand awareness, but Volly can help them here if this becomes a success. And finally, additional acquisition can give Pitney Bowes more exposure, scale, and awareness in the growing data analytics space.

 

Additional Information
A full write-up of the event is available for InfoTrends clients – click here to download – or in our report store.

Twitter feeds of the conference can be found with the #InsightsCon hash-tag.

This event happened in the same week that Pitney Bowes’ Document Messaging Technologies held their Global Customer Summit in Stamford, Connecticut. A blog post of this event can be found here.

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