Adobe Acquires Behavioral Data Management Co. Demdex, Rolls Into Omniture Ad Business Unit
In a move to support its efforts in the global online advertising market, Adobe Systems announced Tuesday the acquisition of Demdex, a privately held data management company. The company will roll audience segmentation services into the Omniture business unit.
Adding Demdex to the Adobe Online Marketing Suite will give advertisers and publishers an audience optimization solution to deliver more relevant digital experiences to customers. Buying specific audiences helps advertisers efficiently spend ad dollars and avoid advertising to consumers who don't meet specific criteria.
The Omniture Online Marketing Suite platform suite now offers data collection, analytics through reporting, and audience optimization. Organization of data is one nuance that is making audience optimization efficient. "One of the big areas we have been asked to move into by customers is finding a way to more efficiently let advertisers and publishers buy and sell online advertising," says John Mellor, vice president of strategy and business development, Omniture Business Unit at Adobe. "So it made sense for us to start here."
For starters, "here" means defragmenting and making it less complex to buy and sell ads by providing data transparency. The integration of Demdex will become particularly interesting to publishers because they need to monetize and gain control of the data to do better targeting.
Publishers increasingly seek to integrate audience data that matches advertisers' requirements, so they can deliver ad inventory at premium rates. A shift to buying and selling audience segments requires advertisers and publishers to gather, consolidate and share anonymous audience data.
Calling the move "strategic" for publishers and advertisers focused on increasing efficiencies in buying and selling online ads, Adobe defines "audience optimization" as the "intelligent collection, compilation and management of anonymous audience data."
For advertisers, audience segmentation can increase return on ad spend. That's the primary driver for advertisers. "You don't care as much what you spend on an ad -- you care more about the return on ad spend," Mellor says. "Audience optimization gives increased return on ad spend."
Deutsche Bank expects the online ad industry in the United States to reach $28.5 billion in 2011, up 11% from the prior year. Both search and display advertising should see double-digit growth. The report suggests that paid search should remain the dominant online ad category for the foreseeable future, and banner ads could likely lose some share to emerging ad formats such as mobile, social, local and online video.
Technology will continue to allow real-time decisions to buy and sell billions of dollars in advertising, supporting bidding exchanges that provide a more efficient way to transact business.
Mellor says the acquisition of technology and about 50 Demdex employees provides a solid foundation for Omniture to build advertising services under Adobe's wing. Adobe acquired Omniture in October 2009. The idea to become "more horizontal" will allow Omniture clients to "play with the multiple ad exchanges out there," leveraging the company's biggest asset, the data that customers collect. It's about making the data actionable, taking the raw data points to create marketing segments for any targeting services from ad exchanges to demand side platforms (DSP) to publishers to creative optimization and others.
The acquisition will allow customers to integrate the data with ad networks, DSPs, and use it to buy direct or any other media-buying method.
Publishers that want to sell inventory for higher CPMs on owned-and-operated properties can tie it into their publisher ad-serving system such as a DoubleClick for publishers to use one data segment in multiple ways. They may want to take audience data in automotive and move it into a DSP to extend their audience and buy more users. They also might want to serve up dynamic creatives to serve custom ads to users. The Demdex acquisition gives them a foundation to provide these options.