Adobe, IBM and the big business of marketing software


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My friends, marketing software has officially become Big Business.

Last Friday, IBM announced its acquisition of enterprise marketing software company Unica for $480 million. Combined with their August 2 acquisition of web analytics leader Coremetrics (for an undisclosed metric ton) and their May 24 announcement to acquire Sterling Commerce (for $1.4 billion) — along with its own WebSphere web application software — IBM has quite quickly assembled a premier enterprise marketing management (EMM) software portfolio.

According to Altimeter Group analyst Ray Wang (quoted in Computerworld), IBM’s move to buy Unica will help round out a portfolio of software that captures the “digital transformation” chief marketing officers and service providers face. “You start with key assets such as Coremetrics that provide insight, you leverage Unica for marketing automation, and you conduct commerce through Sterling Commerce.”

Wham, bam, slap it on a ding dong, CMO. Almost.

Of course, in its press releases, IBM is quick to point out that these acquisitions will have terrific synergy with their Business Analytics and Optimization Consulting group of 5,000 consultants (read: huge services billings). As I wrote in a post a couple of years ago, the vastness of online marketing may prove to be quite a challenge to orchestrate under a single enterprise marketing management system. But as the history of ERP shows, there’s sure a lot of money to be made in trying.

According to ReadWriteEnterprise, IBM says that the enterprise marketing management software market is worth $2.5 billion and doubling in size on an annual basis. That growth symbolizes how fast companies are moving [their] marketing operations online.

Adobe vs. IBM — what, really?!?

And who is rising to challenge Big Blue for the domination of enterprise marketing software? None other than Adobe. They’ve come a long way from Photoshop and Illustrator, tools for the graphic designer buried many layers below marketing’s executive suite. Now they want the love of the CMO.

With their $1.8 billion acquisition of Omniture late last year and their July 28 announcement to acquire web content management provider Day Software for $240 million, they’re aiming to be the marketing department’s digital command center.

Although the IBM portfolio may be better geared towards cross-channel and multi-channel marketing — i.e., a lot of traditional marketing that still lives on in the real world — Adobe’s combination has its strength in the native digital domain. Instead of talking up enterprise marketing management, Adobe is more focused on web experience management (WEM).

But it’s not hard to see that Omniture’s web analytics and optimization technologies are an either/or choice with Coremetrics. And Day Software’s CQ5 platform is a direct competitor to WebSphere integrated with Unica’s interactive marketing software.

The blog Enterprise Irregulars has a nice write-up on the Adobe and Day combination: Adobe + Day Software Coming Together: Cautious Optimism.

Who’s next?

Having read Fooled by Randomness, I’m not usually one for predictions, but these big moves lead to some natural questions:

  • Will Adobe add email marketing (such as Exact Target) to its portfolio?
  • Will Oracle or SAP update their portfolio of enterprise marketing software?
  • Will Microsoft assemble a competitive offering, perhaps for the mid-market?
  • Will HP move in, especially with such big service revenue opportunities?
  • Will get more aggressive about moving into marketing?

And IBM CEO Sam Palmisano said this year he is planning to spend about $20 billion on acqusitions in the next five years. So who’s next for them?

Republished with author's permission from original post.

Scott Brinker
Scott Brinker is the president & CTO of ion interactive, a leading provider of post-click marketing software and services. He writes the Conversion Science column on Search Engine Land and frequently speaks at industry events such as SMX, Pubcon and Search Insider Summit. He chairs the marketing track at the Semantic Technology Conference. He also writes a blog on marketing technology, Chief Marketing Technologist.


  1. Scott,

    Nice column and some good questions. I do think that IBM will be challenged to integrate all of these acquisitions and make sense of them. However, Unica and IBM have long had a strong relationship, with IBM being a major partner/reseller as well as a major user/client of Unica’s software. That bodes well for this relationship. IBM is also playing catch up to other major player such as Oracle and Teradata in this space I do agree that this means there will be other deals that will follow this one with SAP, Adobe and Microsoft beefing up their capabilities. I doubt if HP will make a move, they don’t really seem to have focused in this area. Oracle already has the Siebel asset but could probably use some help shoring up the marketing functionality.

    All of these players will have a hard time learning how to actually talk to marketers. They are very IT focused. Adobe is certainly one to watch. See [url=]my blog[/url] for more on this as well.

    Naras V. Eechambadi, Ph.D.
    SVP/GM, Quaero
    email: [email protected]

  2. My read on this is that IBM wanted the marketing tools to put on top of its InfoSphere Warehouse (the sucessor to DB2) – it gives them the wherewithal to go head-to-head with Teradata and win marketing data warehouse business from Oracle. I think IBM understands that IT guys buy databases and that marketers buy customer data warehouses. You can’t sell to marketers without the accompanying marketing tools.

    Since they just acquired CoreMetrics, it further consolidates the web analytics market. IBM now has a de facto monopoly on on-premise Web Analytics.

    I’m surprised by the valuation, but with IBM’s reach and distribution, I don’t think they’ll have trouble recouping their investment.

    IBM is hugely focused the Far East – I’d expect them to eventually put out a “marketing appliance” i.e., the marketing tools packaged with InfoSphere, to serve those markets.

    It’ll be interesting to see what happens to Unica’s “Interactive Marketing on Demand” SaaS offering. I think it’s binary – IBM will either pull the plug and stay focused on the enterprise market, or invest heavily.

    Dan Smith, ClickSquared, Inc.

  3. Naras and Dan — thanks for the thoughtful comments.

    Naras, I think you’re absolutely right about the challenge these players will have talking to marketers. Solutions such as Siebel — and even to a large degree, Unica’s core products — have really been sold to the CIO and the IT department. The marketing department was involved, but the IT department was committed (to borrow the “chicken and pig” distinction from Scrum).

    On-demand and SaaS offerings are changing that — which plays into my hypothesis that marketing is going to increasingly take ownership of its technology toolset. You raise an interesting point, Dan, as to whether or not IBM is ready for that. I can see how it could be an all-or-nothing proposition for them, especially to the degree that it generates expectations elsewhere in their portfolio.

    Interesting times!Q


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