Localytics, a full suite marketing and analytics platform for mobile and web apps, today announced the acquisition of Splitforce, an automated A/B testing and predictive analytics tool for mobile. The deal brings added predictive intelligence horsepower to Localytics’ suite of mobile app marketing and analytics tools.

The move comes on the heels of a $35 million dollar round Localytics announced late last month, making $59.8 million in funding raised to date. Their clients include ESPN, eBay, Hulu, and Rue La La.

“Mobile marketing” in this context means in app messaging, personalized emails, personalized app experiences and content, even personalized UI experiences in apps. Full suite players like Localytics are a sort of mash-up of modern app analytics solutions, old-school CRM, and web marketing tools. The core is customer data and messaging functionality down to the individual user — or in other words, content personalization. It’s already a crowded space, with leaders like Urban Airship, Tapjoy, and Swrve, among others.

Personalization is a huge data and marketing operations challenge.

In order to do personalization really well, marketers can’t simply rely on historical data. They need to capture all of those past app behaviors and correlate the data to future outcomes through the lens of various audience segments and scenarios. Of course, those scenarios are meaningless without having an integrated platform that can do customer messaging based on those instances. That’s where Localytics’ core outbound marketing capabilities come into play. Splitforce’s machine learning and auto-optimization on messaging and audience segments could wind up being a nice value-add for Localytics’ customers if the two companies’ respective strengths can mesh seamlessly.

“One use case a lot of our customers are focused on is reducing churn, which is a big issue in the app space,” Localytics CEO Raj Aggarwal told VentureBeat in an interview. “Our data shows 20 percent of users don’t come back to an app a second time. We already help our customers have insight into who is churning. Then we give marketers a tool to create a segment and engage them. With Splitforce, rather than have the marketer figure out why people are churning, it can deliver those segments of users with much better context. You won’t have to go through that guesswork. You’ll immediately have the segments and now a series of campaigns to help keep them in the app.”

We’re adamantly tracking the marketing tech funding landscape at VB Insight. In a report we’ll release later this week, you’ll find nearly $700 million in funding and acquisitions for analytics/testing/audience insight companies in Q1 of 2015 alone. This space is white hot. If you add tangential mobile companies to the mix, that figure is more like $1 billion.



It’s worth noting that more and more successful mobile-first companies are using tools like Localytics for marketing automation, user testing, analytics, and of course, monetization all in one package — they still farmed out other related tasks to other tools. In other words, there is a lot of room for upstarts in this space, for now, and huge opportunities for existing players. We covered Localytics’ capabilities in detail, among other mobile marketing automation tools, in our massive industry overview report, Mobile Marketing Automation: How the most successful apps drive massive engagement and monetization.

While our report revealed only 1.5 percent app penetration with tools like Localytics, there are some strong indicators that this is a market that could rapidly mature. “A year ago, maybe 20 percent of our customers were using our marketing capabilities. Today, it’s more like 80 percent. People aren’t just looking for data for the sake of data anymore. They’re looking to take advantage of that data and act on it. If our growth is any indication of the space as a whole, you could see it quadruple over the next year,” Aggarwal said.

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