With Adobe possibly eyeing Marketo, what would that mega-merger mean?
According to a Reuters report, unnamed sources say Adobe is in negotiations to buy Marketo Inc. to extend its marketing automation offerings.
Adobe may be looking to build out its marketing automation offerings. According to a Reuters report released Thursday, the company is rumored to be purchasing Marketo, a platform used by major B2B marketers, including Citrix, McKesson, Charles Schwab and Panasonic.
Adobe’s Creative Cloud solutions are the core of its business. Designed to help marketers create and manage media-rich assets, the missing link for Adobe right now is the ability to offer a more full-scale digital marketing solution. With the addition of Marketo’s wide range of digital marketing products — from its account based marketing platform to its email, mobile and social marketing offerings — Adobe would be able to capture a bigger share of its clients’ marketing budgets while bringing on new clients that want more of a one-stop shop.
Anita Brearton, the founder and CEO of CabinetM, believes the potential acquisition of Marketo makes sense for Adobe.
“As they [Adobe] reach into more and more layers of the marketing stack marketing automation is a natural extension for them,” says Brearton.
Offering a marketing technology management platform for enterprise-level marketers, CabinetM has in-depth data on the cross-over between companies that use both Adobe and Marketo. According to the CEO, among CabinetM clients using Adobe, Marketo is the fourth most popular product in those clients’ marketing stacks – behind Google Analytics, LinkedIn and Twitter — which Brearton says are in everyone’s stacks.
“Narrowing to stacks with the Adobe Marketing Cloud, Marketo is in the top 10 of other products used alongside the Adobe Marketing Cloud,” says Brearton.
“From a marketer perspective, it’s hard to know whether it will change much other than potentially providing some buying efficiencies. We’ll have to wait and see if this impacts product functionality and direction,” says Brearton.
The reports of a rumored acquisition may not be much of a surprise to industry insiders that have been following Marketo’s business trajectory. More than two years ago, Bloomberg reported the company had begun working with Morgan Stanley to explore the possibility of a buyout — at the time, speculation around the potential buyers included Adobe along with SAP and Microsoft.
Instead of being purchased by a bigger fish in the marketing technology world, Marketo was acquired by Vista Equity Partners for $1.8 billion.
In June, Adobe reported its second-quarter revenue at $2.2 billion, a 24 percent year-over-year increase in revenue growth. A month before, the company had purchased Magento Commerce for $1.68 billion. With its continued upswing in revenue and recent acquisition history, Adobe possibly purchasing Marketo would be a logical next step for the company as it looks to make a deeper dive into the marketing technology landscape.