PrismaStar exit underlines demand for e-commerce tech solutions

The global internet retailing market continues to evolve at an incredible speed. Historically centred around the wealthier markets of North America and Western Europe, where disposable incomes were higher and internet penetration greater, growth is now being driven largely by new markets in Asia Pacific (especially China) and Latin America, where incomes are rising and internet use is spreading rapidly. As consumers adopt more tech, businesses are eager to implement more services in order to attract ever-greater purchases, which is driving growing demand for firms able to provide innovative and effective solutions in e-commerce.

One of the main drivers of growth has been the rapid expansion of the global internet user base, along with growing broadband adoption and mobile phone use. Emerging markets, in particular, are driving growth in web use, as increasing purchasing power means more consumers can afford new technology, while substantial government investment in infrastructure means that operators have often leapfrogged outdated technology and implemented latest-generation telecom architecture.

Along with rising internet usage in general, the increase in web access via smartphones and tablets are the key factors contributing to the rapid growth in virtual shopping. Not all smartphones users access the internet via their devices, but the rapid growth in smartphones at the expense of feature phones, and in tablets at the expense of PCs and laptops means that the potential for mobile access is becoming ever greater. The arrival of 3G greatly increased the capability of smartphones, allowing them to offer such services as Global Positioning System (GPS), mobile TV, video on demand and location-based services.

As a result of this growing interconnectivity, sell businesses are seeing greater activity in the purchases of companies that provide e-commerce solutions. Just recently, leading e-commerce search and navigation specialist FACT-Finder bolstered its footprint in the UK with the acquisition of PrismaStar, the UK’s award-winning provider of Guided Selling Solutions for e-commerce retailers. The acquisition complements FACT-Finder’s current offering, providing a foothold in the UK market and a base in Cambridge, one of Europe’s key technology hubs. Back in 2010, Acuity Advisors worked with PrismaStar to successfully help them secure their A-round funding from venture capital specialists Octopus Ventures, enabling the company to commercialise its technology and secure a tier one customer base.

Amazon is another company symbolic of how vital tech progress is in e-commerce. Their success over the past decade is directly attributed to their technology advantage. As a result of their technology and infrastructure investments, Amazon has the most advanced capabilities of any player in the areas of website personalization, customer targeting, price optimization, frictionless checkout, low-cost and fast shipping, and product selection. According to a report by management consulting firm Bain & Company, Amazon spends roughly 3.3% of total revenue on information systems investments.

As more e-commerce operators invest their revenues in technology platforms, the market will see a steady increase in deal flows and exits in this space.




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