International Business Machines Corp. (NYSE:IBM) has resorted to acquisitions as it seeks to bolster its cloud business. The acquisition of German firm Ecx.io marks its third deal in the digital marketing space, in less than one week. With the deal, the tech giant is set to bolster its team of design specialists with the addition of 200 new experts.
Push For Accelerated Growth
Excio.io joins Resource/Ammirati and Aperto all acquired to bolster International Business Machines Corp. (NYSE:IBM)’s design unit IBM iX. Financial terms of the deals remain under wraps. The acquisitions are all part of the firm’s strategy of building 25 design studios this year.
Initially, the company wanted to grow organically, but a desire to accelerate growth necessitated the acquisitions. With the acquisition of Ecx.io, IBM should be able to raise the bar when it comes to digital marketing and commerce.
The German digital agency comes into the fold with a good number of clients that IBM can directly target. Clients in Europe are currently leveraging the firm’s expertise in developing customer-facing digital strategies as well as e-commerce systems. Ecx.io also has a working relationship with the likes of SAP SE (ADR) (NYSE:SAP) and Adobe Systems Incorporated (NASDAQ:ADBE), deals that will remain in place even with the merger.
New Growth Opportunities
International Business Machines Corp. (NYSE:IBM) now boasts of more than 1,100 designers a 10,000 staff in its design unit. With the wave of acquisition, the company is moving to open three new IBM iX studios in Prague-Warsaw and Dubai. All the developments and efforts in the recent past are all part of big blue’s push to create the largest digital agency.
Closing and announcing deals all but underscore how IBM is trying to be a key a player on the front end of design services. Having faced 15 straight quarters of falling revenue, the firm is more than ever in dire need of new areas of growth.
International Business Machines Corp. (NYSE:IBM) is under pressure to shore up its earnings after years of declines. Cloud business has turned out to be a safe-haven, its cash-cow hardware business having come under pressure in the recent past. Ramping up efforts on the creative design is seen as one of the reliable entities able to offset weakness in other areas.