The SAP-Qualtrics Deal is in-line with the trends we have seen through 2018. This was the year of the blockbuster deals. Deals where legacy technology companies reinvented themselves to stay relevant, in a hypercompetitive market, by acquiring niche cloud and software companies. A few weeks ago, IBM acquired RedHat for $34 Billion. Rewind a couple of months back. Microsoft acquired GitHub for $7.5 Billion, and earlier on, Salesforce acquired Mulesoft for $6.5 Billion.

A few years ago, Qualtrics made a pivot from being just a maker of survey software tools, to one focusing on “experience management” or XM. In a Customer-first era, where social media empowers every customer, experience management platform helps analyze every aspect of the CX- whether it be from call centres, or retail stores, or online ecommerce platforms, to drive greater customer loyalty and customer referrals. In other words, using platforms such as Qualtrics, a company is able to overcome the information silos, and analyze the overall experience delivered by it across platforms, mapping deficits or problem points, and eradicating them.

By acquiring Qualtrics, SAP now has a comprehensive Experience Management/XM platform that includes customer, brand, employee and product experience solutions. SAP is behind CRM, ERP and HR – the operational data platforms for most enterprises. By building on this platform with XM solutions, helps SAP to position its “intelligence enterprise platform” for the next phase of growth, while also getting a leg-up against Salesforce.

SAP got attracted to Qualtrics on the back of its forecasted >40% forward growth rate, and expected revenue of >$400 Million by 2018 end. Qualtrics acquisition is likely to complement SAP’s anticipated TAM >$350 Billion.