MapInfo Seeking New Direction with Acquisition of Thompson

By Joe Francica

In an announcement revealed on Monday, MapInfo said that it had acquired Thompson Associates, an Ann Arbor, Michigan based firm offering site selection and analysis consulting services, primarily to the retail, real estate and financial services sectors.With clients such as Dominos Pizza, Circuit City, Albertson's, and CB Commercial, along with many other well-known companies, Thompson has been long regarded as one of the most reputable companies providing site modeling.

But the move comes amid news that MapInfo's projected quarterly financial numbers have slipped once again and that it will not make forecasted estimates for its first quarter. Yet, MapInfo executives are bullish on the outlook for the company, in particular, its newly formed aCRM division under which the Thompson acquisition will fall.

Directions Magazine had the opportunity to speak with Mike Hickey, chief operating officer, about how MapInfo was looking to direct their business through acquisitions and the goal for top line sales growth.When asked about how the acquisition came about, Hickey responded, "This has been in the works for probably a year and one-half.We actually hired an investment banker to help us select candidates.We originally looked at 12 to 15 companies; narrowed that down to seven; took a real close look at probably five of those, and we felt this one was a good fit for us from a culture perspective and from a strategy perspective to sort of round out our aCRM product line and capabilities moving forward."

The Thompson acquisition appears to move MapInfo away from a pure software company and more toward a solution provider, a strategy that Hickey said the company has been moving to accomplish over the last five or six years. Two years ago, MapInfo acquired Compusearch in a move to push it further into the CRM space and to augment its demographic data assets.As such, there now appears to be a "blurring" of how the industry perceives not only MapInfo, but also other companies who are attempting to offer data, software, and solutions.

"As in any type of industry, things mature and I think you would see more of a blurring of the lines coming together.You realize as you are in talking to clients that they have all the same needs and that if you are there solving one, you can help solve the other," said Hickey.

MapInfo's aCRM group will be the beneficiary of Thompson's assets and intellectual property but some may be confused by the seemingly disparate goals of CRM versus site location and consumer research.Hickey responded, "A third of their (Thompson's) business actually is not services but application solutions built on top of MapInfo.So what they have done is taken some of the modeling and some of those rules and algorithms and built them into applications that help clients do site selection.So, what Thompson does for people is...customer analytics and market analysis and...what their business does is analyze the makeup of potential customers in certain locations...and maximizes location as far as where you want to put a site or where you want to put a store." Hickey also noted that MapInfo already has some of these capabilities through its acquisition of Compusearch but that it had not brought those services into the U.S.MapInfo feels that the two groups have complimentary methodologies.

Thompson has been engaged in many other services beside just location analysis and modeling.It also provides a service to perform consumer research and merchandising for companies needing to extend beyond site identification. This, however, will be a new business for MapInfo to address but it hopes that it will be a natural extension of the existing services."A big part of this strategy is that MapInfo is changing as a company; we don't want to be as dependent on things like the telecommunications market in GIS and that we need to be bringing more value to our customers.And we've been diversifying our business across the industry; really focusing on trying to be a leader in customer analytics; and trying to be a leader in bringing GIS-type platforms to the enterprise world which crosses over into what we have done successfully with Vodafone on the LBS side," said Hickey.

Hickey was asked about the technology being brought over from the AnySite technology division, which has solutions build on top of a MapInfo platform. AnySite markets a series of software products for desktop and web-based site selection, which will now be available to current MapInfo business partners to resell.However, there looks to be some conflict between AnySite Analyzer and MapInfo's Target Pro.When asked about the situation Hickey said, "Right now, I think they are complimentary.AnySite is more specifically focused on site selection; Target Pro is more generic.Target Pro is more focused on an enterprise deployment; AnySite could be deployed more for a power user."

Asked further about the acquisition and specifically if Thompson will be absorbed into MapInfo or remain a wholly owned subsidiary, Hickey said that Thompson would become fully integrated within the company.MapInfo will retain the services of Thompson president Robert Buckner who will become the vice president of analytical services and reporting into the aCRM business unit.Other executives will be staying on as well, however layoffs have already occurred at both Thompson and AnySite where redundancies were evident.

Published Wednesday, January 8th, 2003

Written by Joe Francica

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