An analysis of their acquisitions Abhijit Das Arpit Tandon Sonakshi Behl Vivian Paul Gonsalves Section A - Group 8

The Competition Major players are building barriers to entry by forcing industry consolidation through several acquisitions
Competition Opportunity Competencies

The Industry is moving from being fragmented to consolidated with major players acquiring the start-ups

$871 million

The Opportunity - Adobe has two major strategic focus areas Digital Media and Digital Marketing
Competition Adobe Digital Media
1. Creative Tools & Services Touch Apps Web Platform Technologies 3. 4. Creative Cloud 1.

Opportunity

Competencies

Digital Marketing
End to end digital marketing solutions Managing, measuring, optimizing, monetizing digital experiences Products like Site catalyst and Day

Positioning

Cost
Target Scope

Product Uniqueness

2. 3.

2.

Broad

Cost Leadership

Product Differentiation

Narrow

Focus (Cost)

Focus (Differentiation)

Focus shifting Tap into $72 billion digital ad industry

Competencies String of Pearls strategy to set up a complete marketing cloud

Competition Opportunity Competencies

Year 2009 2010 2011 2011 2012 2013

Acquisition Target Omniture Day Software Demdex Auditude Efficient Frontier Neolane

Price paid $1.8 billion $240 million $58 million $120 million $400 million $600 million

Strategic Rationale Competency acquired Web Analytics Web content management Audience Optimization & Behavioral management Video advertising management Cross channel advertisement campaign optimization Cross channel campaign management

Omniture Acquisition Is it a Over-Priced Strategic Fit?

Deal Value - $1.8 b in 2009 Omniture Financials Revenue(2008) - $296m Income(2008) - $(44.8m) Web Analytics Market Size - $431 m in 2009 Growth Rate - 17% $ Opportunity - $1b in 2014 IBM, Google, Yahoo! are already present Strategic Rationale Integrated one stop shop for website creation & Omnitures web measurement services Create product differentiation by embedding analytics with Adobe creative platform Adobe use its direct sales force and channels to increase adoption of Omnitures services
Omniture Financial (In $ m)
400 200 0 -200 2006 2007 2008 79.7 143 296 Revenues Income

Product Portfolio Fit

Neolane Acquisition
Deal Value - $600 m in 2013
Neolane Financials Revenue(2012) - $58m
100 50 30 44

Neolane Financial (In $ m)

58
Revenues

Strategic Rationale 0 2010 2011 2012 Neolane closes Adobe's strategic and longstanding gap in campaign management. Brings critical cross-channel campaign management capabilities to the Adobe Marketing Cloud Enable Adobe to compete with IBM,SAS and Teradata in the enterprise campaign management market Challenges Adobe and Neolane target different customers Cultural Integration Issues - "Neolane is very 'French' with some strong and forceful personalities at the top of their organization As per an analyst

Efficient Frontier Acquisition

Deal Value - $400 m in 2012 Strategic Rationale Adds cross-channel ad campaign forecasting, execution and optimization capabilities to Adobes existing Digital Marketing Suite In social marketing, Efficient Frontier adds a social ad buying capability for Facebook and synergy with Adobes SearchCenter product In search marketing, Efficient Frontier extends Adobes SearchCenter solution with a complementary search portfolio optimization system In display marketing, Efficient Frontier has a real-time bidding system to enable Adobes digital marketing customers to increase ad performance Key Takeaway These three major acquisitions demonstrates Adobes focused strategy on digital marketing and digital media We're doubling down in areas where digital content is mission-critical: Digital media and digital marketing. We have organized Adobe to focus on these opportunities, and we're investing to win in each area Shantanu Narayen, CEO, Adobe