How Adobe Capitalizes On Efficient Frontier Acquisition

by Laurie Sullivan, Dec 1, 2011, 4:19 PM

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I've written in the past about the advertising industry's attempt to connect platforms similar to the way enterprise resource platform (ERP) providers Oracle, SAP and Microsoft did in the early 2000s. Aseem Chandra, VP of product marketing for Adobe's Digital Marketing business, who comes from a similar business background, sees "some commonalities" between enterprise applications and Web-based advertising platforms. 

Chandra believes agencies and advertisers will standardize on connected Web-based platforms to transact digital marketing. Innovation will prompt consolidation. The electronics supply chain looked back downstream to connect with the ERP system, but advertisers and agencies focus upstream, concentrating on building a network for them to standardize on.

Chandra told MediaPost's Search Marketing Daily that Efficient Frontier will roll into the digital marketing business. Adobe announced the acquisition of Efficient Frontier on Wednesday. It marks the fourth acquisition in the advertising space for Adobe during the past few years, following Omniture, Demdex and Auditude.  

Aside from building out social services, Adobe will work to better monetize media -- solving the problem for both advertisers and publishers, Chandra said.

Adobe clearly changed its focus in the past month, dropping development of its Flash program for mobile browsers and eliminating 7.5% of its workforce. The transaction should close in Q1 2012. Efficient Frontier CEO David Karnstedt will remain in a different role.

Adobe recently held a financial analyst meeting and Brad Rencher, senior vice president and general manager of Adobe’s Digital Marketing business, shared a slide that provides insight into the company's direction and revenue. Combined estimated revenue from Omniture and Day Software is $570 million for FY11.

Early in November, Adobe announced a growth strategy and how it would align its business around digital media content creation and digital marketing. The key features include extending an arm to advertisers through analytics and reporting for social and mobile. It also will personalize the digital experience across media channels, from search to email to display advertising, and accelerate the creation of platforms to monetize online advertising.

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