ARMONK, N.Y. — IBM here has agreed to acquire DemandTec, San Mateo, Calif., a provider of price optimization and deal management software to food retailers, for approximately $440 million.
The acquisition of DemandTec will extend IBM’s “Smarter Commerce” initiative by adding cloud-based price, promotion and other merchandising and marketing analytics to help companies better define the best price points and product mix based on customer buying trends, IBM said.
Food retailers that have used DemanTec’s price optimization system include Brookshire Grocery, Tops Markets, Bi-Lo, Giant Food Stores and FreshDirect. Users of DemadTec’s deal management software include A&P, Save Mart, C&S Wholesale Grocers and Ahold USA. Target has used DenadTec’s assortment optimization system. DeandTec’s software help retailers predict how consumers will respond to a price change and adjust the marketing mix for a product.
In total, DemandTec has approximately 450 customers worldwide in retail, consumer products and other industries. Retail industry segments served include grocery, drug, convenience, consumer electronics, office supplies, apparel, department stores, and quick-serve restaurants. Manufacturer segments include fast moving consumer goods categories such as food, beverage, and health & beauty. DemandTec also has a portfolio of 31 patents in the areas of pricing, response analysis, and promotion analysis.
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