The potential Adobe acquisition of Marketo could unsettle the customer experience software market and give Adobe, which is mainly known for its B2C products, a substantial network of B2B customers from Marketo.
Adobe is in negotiations to acquire marketing automation company Marketo, according to reports.
"It's a trend that B2B customers are trying to become more consumer-based organizations," said Sheryl Kingstone, research director for 451 Research. "Marketo is maybe throwing in the towel in being a lead marketing vendor on its own."
But, reportedly, talks between Adobe and Marketo's holding company may not lead to a deal.
Ray Wang, founder of Constellation Research, said leaks could be coming from Vista Equity Partners Management, which bought Marketo in 2016 and took the company private, in the hopes of adding another bidder to the race to acquire Marketo.
"If people think Adobe would buy Marketo, maybe it would get SAP to think about it," Wang said. "The question is, who needs marketing automation or email marketing? And when you think about the better fit at this moment, it's SAP."
When reached for comment, Adobe declined, adding that it does not comment on acquisition rumors or speculation.
Adobe expanding to B2B
Marketo said it had roughly 4,600 customers when it was acquired by Vista Equity. It's unclear whether Adobe and Marketo have much overlap between customer bases, but there could be product overlap between the software vendors.
Sheryl Kingstoneresearch director, 451 Research
Adobe has its Marketing Cloud system, and both vendors offer basic martech features, like lead scoring, lead segmentation, web tracking, SMS marketing, personalized web content and predictive analytics. But an Adobe acquisition of Marketo would allow Adobe to expand into a wider B2B market, while allowing Marketo to offer its users the ability to market more like a B2C vendor using Adobe's expertise.
"It's a huge benefit for Marketo when you look at Adobe," Kingstone said.
"Marketo has struggled in a B2B sense when its customers try to implement an ABM [account-based marketing] strategy," she said.
Despite any potential overlap with its own products' marketing capabilities, Adobe could find the chance to break into a pool of nearly 5,000 B2B customers compelling.
"There's a lot of value in Marketo, and Adobe has been gun shy about entering B2B," Wang said.
If the Adobe acquisition reports turn out to be accurate, it would amplify what has already been a busy year for the vendor. In May, Adobe acquired commerce platform Magento for a reported $1.7 billion.
A Reuters report about the Adobe acquisition of Marketo said likely prices will well exceed the $1.8 billion that Vista paid for Marketo when it took Marketo private.
Over the past few years, industry-leading companies in the CRM and customer experience spaces have sought to build alliances with other vendors.
Adobe and Microsoft have built a substantial partnership and have even gone to market together with products, while Salesforce and Google unveiled their partnership and product integrations last year at Salesforce's annual Dreamforce conference.
Marketo has been one of the few major martech vendors without an alliance. Combining its technologies with Adobe's creative suite and potentially Microsoft's B2B breadth could make a significant imprint on the industry.
"If this is real, then it means Adobe has gotten serious about B2B," Wang said.
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