Insights

Analysis of the Adobe Magento Acquisition

Adobe acquires Magento
Now that the hot takes and POV pieces have subsided, let’s take a more calculated look at Adobe’s recent acquisition of Magento. In short, we think this is not only a win for both companies, but for every merchant trying to navigate the complex digital economy.

Experience-Driven Commerce

It’s interesting to see how Adobe is positioning the combined offering as “experience-driven commerce”. We’ve long believed that a focus on the complete customer experience is fundamental to any successful digital commerce program. That’s why we’ve positioned ourselves as The Commerce Experience Agency, building capabilities to serve complex multi-channel, multi-touchpoint buying scenarios. Conversion events happen at every stage of the customer journey – from awareness through acquisition to (through meaningful engagement) affinity. This acquisition will enable organizations to deliver complete experiences, when aligned as part of a long-term commerce strategy.

Competition Breeds Innovation

Competition in the marketplace is healthy. We’ve previously seen SAP and Salesforce make investments to bring commerce capabilities into their technology ecosystems to fill the gap. Now Adobe has followed suit and bridged the commerce gap in their offering. This will prompt all the major players in the ecommerce space to take a fresh look at their platform roadmaps and accelerate their strategies. As a leader in delivering contextualized digital experiences, Adobe is now strategically positioned to deliver contextualized commerce experiences and leapfrog the competition. The result will be overall stronger ecommerce offerings, which will benefit every brand and business selling online.

A Boon for B2B

It seems like we’ve been talking about delivering consumer-like experiences to B2B buyers’ for years now. Now, B2B manufacturers and distributors have another powerful option in how they deliver these rich buying experiences to their customers, while maintaining the necessary complexities of their B2B relationships. This is very exciting.

As aptly identified in The Forrester Wave™ for B2B Commerce Suites, Magento has made significant investments in upgrading the platform’s B2B capabilities. These backend capabilities pair well with Adobe’s context-aware presentation layer. This provides Adobe with a compelling story to tell B2B companies considering their next ecommerce solution. From contracted pricing to custom business terms, many B2B companies already maintain 1:1 relationships with their customers. The new Adobe commerce offering will enable these companies to translate these personalized, 1:1 relationships to their digital experiences.

Challenges Exist; Solutions will Follow

Let’s not underestimate the road ahead. The path from acquisition to “seamless integration” will take some time, but you can be certain that Adobe will invest what is necessary to get it right. It’s easy to forget that Adobe (Java) and Magento (PHP) are built on separate technology stacks. That will require some engineering handiwork to make them function in lock-step. We suspect a middleware and/or APIs will be created, if they’re not already in progress, that will ultimately sync functionality and be invisible to the end user, and that the initial work here will coincide with the finalization of the acquisition.

Many posts on this acquisition have pointed to the broad Magento developer community as a benefit. In reality, the sheer breadth of the Magento develop pool has been a double-edged sword. The popularity of the Magento platform, particularly the community version, led to a proliferation of available developers. The quality of their development work, however, varied greatly. We expect Adobe to aggressively vet their partner network, ultimately resulting in a smaller pool of highly qualified agencies. This will bring an overall improvement in quality, benefitting the brands and businesses that rollout this technology.

Like any complex acquisition there will be inherent challenges in bringing together the technologies, processes, and cultures of these two market leaders. But, given Adobe’s stellar track record in integrating past acquisitions (e.g. Omniture among many others) we’re bullish that the end-result will be a difference-maker in the market.