Management technology outsourcing and consulting service
) recently completed the acquisition of U.K.-based design agency,
Fjord. The acquisition, which was announced on May 7, 2013, was
aimed at bolstering Accenture's design and marketing
capabilities. Financial terms of the deal were kept confidential.
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Founded in 2001, Fjord evolved as a service design consultancy.
It has been engaged in the task of developing creative and
customized designs to make understanding of complex systems
easier. Fjord has redesigned Nokia.com and developed PayPal's
mobile apps. Apart from this, Citibank, Harvard Medical School,
) and Telefónica, BBC and
Banco Bilbao Vizcaya Argentaria
) are counted as its blue chip customers.
Fjord's capabilities will be added to Accenture Interactive
platform, which is the company's marketing-services arm.
Accenture Interactive was formed in 2009 (in association with its
client Procter & Gamble Co.) in order to deliver superior
consulting, technology and analytics services mainly to chief
marketing officers (CMOs).
Fjord is well known for its expertise in designing hybrid
platforms (smartphones, tablets and PCs) and for creating dynamic
services. Post integration, Accenture Interactive and Fjord are
expected to offer a comprehensive digital marketing solution that
would help clients to formulate marketing strategies.
Competent marketing is the key to success for every organization.
Marketing and digital executives of a company are responsible for
developing digital marketing campaigns, marketing contents,
e-commerce and marketing operations. Accenture Interactive is a
well-integrated platform that helps CMOs devise marketing
strategies and derive higher ROI (return on investment) from it.
Apart from Fjord, Accenture took over Hong Kong-based online
Acquity Group Ltd.
) for roughly $316.0 million in cash (in early May) and digital
production services vendor avVenta Worldwide (Oct 2012) to
enhance its interactive platform. These acquisitions will enable
Accenture to address the critical needs of CMOs while digitizing
their marketing plans.
According to U.S.-based IT research firm Gartner Inc., firms
generally spend 2.5% of their revenues on digital marketing and
the spending is expected to go up by roughly 9.0% in 2013. One
more important statistics from Gartner is that around 50.0% of
the digital marketing activities get outsourced.
Considering the growing need for digital marketing, we expect
Accenture's investments in its digital and marketing capabilities
to pay off soon.
We are encouraged by Accenture's strategy of growing through
acquisitions. However, increasing competition from IBM Corp., a
strained spending environment and Accenture's broad European
exposure (roughly 40.0%) may temper its growth prospects to some
Currently, Accenture has a Zacks Rank #3 (Hold).