According to Fred

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You’re Responsible for Your AI Literacy

In today’s rapidly evolving digital landscape, understanding AI and its implications is more crucial than ever. During a recent vacation, a simple conversation about AI highlighted the urgent need for AI literacy.

The Importance of AI Literacy

I was recently on vacation down in the Turks and Caicos with my wife for some much-needed R&R. It was our 20th wedding anniversary trip, and the plan was to disconnect and just relax. During our time at our resort, we got into conversations with others who were there. One couple we met had kids roughly the same age as ours, and they lived in a city that I used to frequent with a past employer, so we had things to discuss. We ended up having lunch together one day, and the conversation led to AI and GenAI. My wife promptly rolled her eyes at me as our new acquaintances, who were in the banking industry, had some awareness of GenAI and ChatGPT, but had never really used it. After getting a look from my wife, I promised to show one thing and be done. So I whipped out my phone and opened ChatGPT to show him just what one of the sample prompts could do. It was a simple “Give me tips to overcome procrastination.” I clicked the prompt, the app started to write the response in real-time, and our new acquaintance had his mind blown.

This showed me, actually reminded me, that while I try hard to stay in tune with the latest and greatest in AI, not everyone is. AI literacy is a big deal and potentially a big problem if you do not take it into your own hands. Especially if workplaces and schools ban it.

Taking Control of Your AI Education

When something as big as Generative AI, and the advancement of AI in general, comes around, most people, companies, and those in positions of responsibility will take a “sit back and wait” approach. And for many valid reasons, it is a valid approach. It’s complicated. It has a lot of implications on how organizations and businesses work. For the education field, it has broader implications on how students learn, do homework, what is considered “cheating” and more.

But this isn’t the first time we’ve had a big technological change in our lives. Many of the same arguments being made today for the use of AI/GenAI were the same ones used when Google was introduced.

AI Will Become the New Normal

I wish I could tell you that all the good things that AI and Generative AI will provide us didn’t come with a dark side. The reality is that GenAI is introducing a whole slew of challenges from personal and corporate ethics to deep fakes and misinformation to hacking and cybersecurity to legal issues. While AI has been around for decades, that lonely day in September 2022 when Sam Altman, Greg Brockman and the OpenAI team launched ChatGPT for free and introduced a new way for the average human to interact with AI, Pandora’s box was opened and will never be shut again.

Since that day we now have a new way of working. A new way of learning. A new way of creating. A new way to engage with technology. For better or worse.

While GenAI will go through its own evolution from hype to questioning the value of it and the investments around continuing to develop GenAI it will become mainstream. In fact, Google, Apple and Meta are going to be the biggest players who will do it. And they are doing it now.

AI in Everyday Life – It is Here Thanks to Google, Apple and Meta

While I want you to better understand AI and GenAI specifically, companies like Google, Apple, and Meta are bringing it to you now. Today. To me, this is why you need to take your AI literacy seriously. You need to understand how each company is approaching GenAI and integrating it into your every day lives.

Apple is launching its new AI, called Apple Intelligence, with their next iPhone release in the fall of 2024. While Apple has been using AI in their phones for years, through features such as personalization, photo editing, video enhancements and more.

Google has been integrating AI into their platforms for years as well. Their latest foray is with an upgraded AI chatbot experience with the release of Gemini on Google phones. Gemini is also now featured in Google Docs, Sheets, and Slides if you pay for their upgraded plans.

Google is also bringing GenAI to search results. While there has been some gaffes already in the outputs created, this will only improve over time and will change the way we engage with search and search results.

Meta is adding their own AI engines into Facebook, Instagram, Threads and What’s App. You will start to see “Ask Meta AI or Search” appear in the search bars of these apps.

The point is, these technology companies are bringing AI to you, today, and doing it in very consumer-friendly ways.

Resources to Get Started on Your AI Literacy Journey

Getting started to learn more about AI and GenAI is not challenging. There are lots of articles published daily on the topic. Here are some of my favorite resources to help you get started.

  • GenAI Tools – Here are some you can get started for free, or paid versions. Thre are many more than I list here, but these are good starting places.
    • ChatGPT – the one that started it all. I highly recommend trying the paid version for at least a month to see the difference. Can generate text, images, code and more.
    • Perplexity.ai – uses the Google API and pulls in more real-time content from the Internet in the response, with citations. With the paid version you can also access other models such as Claude.
    • Claude – a ChatGPT competitor, but more private in that it doesn’t have access to the Internet for anything after it has been trained. Claude maker, Cohere, prides itself on its take on security.
    • Adobe Firefly – generate images in a variety of formats and styles. Adobe claims it has trained Firefly on its own content, and thus, its images are commercially ready for use.
  • Podcasts – a list of my favorite AI podcasts
  • Free Education Resources – Check out some of these free resources from top companies and institutions
  • People to Follow – if you use social media, here are a few people to follow and even turn notifications on

Every journey begins with a step. Just one step. Take yours today so you can be better informed about the changes that are coming your way with GenAI.

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The AI Revolution: Why Every Company Will Be an AI Company by 2026

The whispers of “generative AI” and “ChatGPT” might have seemed like science fiction a few years ago.  Today, those whispers have turned into a groundswell, and businesses are rapidly waking up to a fact: Artificial intelligence isn’t just a passing trend – it’s the single most transformative force shaping the future of work.

If you’re still on the fence about AI’s significance, buckle up. I believe with absolute conviction that within the next three years, every successful company will become an AI company in one capacity or another. Don’t believe me? Let’s explore the driving forces behind this unstoppable wave.

2023: The Year of Discovery

Last year was a watershed moment for generative AI. The public launch of game-changing tools like ChatGPT, DALL-E, Midjourney, Stable Diffusion, Claude, Llama, and Perplexity sparked a collective “a-ha moment” for businesses globally. It wasn’t the technology itself that was revolutionary – AI has been developing for decades – but the sheer accessibility and user-friendliness of these new tools.  

Suddenly, AI was not confined to the tech giants with teams of data scientists and PhDs. Its power became accessible through a simple text-chat window, prompting businesses to ponder its potential applications. This now raised the question: How can we put this tool to work for us?

So companies started to educate themselves and maybe put a small team together to define problem statements and define use cases.  The response varied: while some companies adopted a wait-and-see approach, others, including Coca-Cola, Walmart, EY, Accenture, McKinsey, dived in headfirst to gain a first-mover advantage.  

2024: Experimentation and Internal Revolution

2024 marks a year of bold exploration. Forward-thinking companies don’t just see AI as a shiny toy; they view it as a catalyst for reshaping their internal operations. This stage isn’t about launching AI-powered customer products just yet. Instead, businesses will focus on:

  • Streamlining tasks: Departments across the board, from marketing to HR, will experiment with automating repetitive, time-consuming work. The goal? Free up employees to focus on strategy, creativity, and human connection. 
  • Enhancing decision-making: AI’s capacity to analyze vast datasets will play a vital role in smarter decision-making. Expect real-time insights drawn from customer data, market research, and operational trends.
  • Upscaling employees: A focus on upscaling will take center stage. Businesses understand that AI isn’t about replacing workers; it’s about equipping them with an incredibly powerful co-pilot.

Each of these comes with the understanding that there are teams internally who are becoming comfortable with AI and GenAI.  These organizations probably have established an AI Centers of Excellence or task forces focused on the liability of using these tools.  However, the risks of putting out public facing GenAI solutions at this point has proven to be risky.  Sorry Alaska Airlines. 

If we think about this year, 2024, early adopters will begin to really see the benefits and understanding how to deploy GenAI solutions at scale.  Other organizations will start to wake up to the fact that they need to start taking GenAI seriously.  If nothing else, the tools that companies use every day will start to publish GenAI features into their products that address these three areas, thus forcing companies to address GenAI in some way.  

2025: Realizing Value and the Competitor Gap Widens

By 2025, early adopters won’t just be fiddling with AI: they’ll be reaping the rewards. This is where the competitive playing field takes a drastic turn. The proof points pile up:

  • Efficiency gains: Companies using AI to optimize workflows consistently outperform those that don’t. Reduced costs and faster turnarounds will be the hallmarks of success.
  • Data-driven innovation: AI will help identify potential areas for new products and services, based on a deep understanding of markets and customer pain points.
  • Competitive Pressure: Early AI adopters will set a new standard, forcing businesses in every sector to catch up or risk obsolescence.

New Large Language Models (LLMs) will have emerged, some being industry specific. Some companies may even build their own LLMs specifically to use with their own data. Additionally, every company will have tools in their technology stack that has AI features and functionality at the fingertips of their employees, and the value realization will start to become inevitable and evident.  Our risk tolerance will start to wane as AI literacy plateaus.  

2026: AI as the New Normal

In a stunningly short time, by 2026, we reach the tipping point where AI isn’t just an advantage—it’s table stakes:

  • Software eats AI: Popular business software from CRMs to design tools will have generative AI features baked in. Using them without AI capabilities will feel archaic.
  • The new AI workforce: AI-generated content, whether it’s draft emails, initial market reports, or social media copy, will be woven into workflows by a skilled human workforce trained to optimize the tool.
  • Ethics and the Human Touch: Ethical concerns and AI regulation will come to the forefront as businesses grapple with the balance between efficiency and the irreplaceable value of human judgment and empathy.

The playing field flattens and AI and GenAI will be second nature.  We will have moved into a state of normalcy and everything from your smart home device to your enterprise applications will be using GenAI in ways we can’t live without. 

It’s Not Just Hype

These predictions aren’t mere speculation. Studies support the accelerated pace of AI adoption:

Embracing the Inevitable

This AI-powered future can be intimidating. But for those willing to embrace change, it offers incredible opportunities. Companies that take AI seriously are the ones that will stay in the race. The next three years are going to be critical for every company as they address AI both internally for efficiencies, but also as they consider building products and services. Are you ready to make your company an AI company?

Disclaimer: Generative AI was used in the creation of this content.

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After a year of M&A where do the major DXPs go from here?

It’s a crowded marketing technology space and it gets worse every year. Startups are popping up it seems like every day to combat a specific niche need in the world of today’s digital marketer. To make matters worse (?? – intentional question), the SaaS platforms make it easier for companies to jump in and try/buy/use than ever before. The craziness around it all is that it only gets worse as you get bigger in size. But we also see that best-of-breed platforms are getting used as well, which leads me to the topic for this article. Where do the major digital experience platforms (DXPs) go from here?

Did that say billions?!

I always have some level of surprise when I see the headlines that “So and So” company bought another company for some big price tag. Let’s just use Salesforce and Tableau for example. Any time an acquisition in the MarTech space ends with a “B”, we all take notice. So when Salesforce dropped $15.7B, it’s not just an acquisition, it’s a statement. But like any acquisition, they are made for a reason, and the likely reason is that it fills a gap that the acquiring company has to either fuel further growth or immediate complementary services to add to the bottom line. Thus as you look at all the acquisitions of the last year (and into 2018) of all the major DXPs, you will see a pattern — fill a gap. There are some distinct differences in the gaps being filled and how they fuel further growth for each platform. However, gap filling is the main driver.

The acquisitions of 2019

Here is a quick list of the acquisitions in 2019 by the major DXPs.

Adobe

  • Allegorithmic – maker of 3d material and texture software
  • Adobe’s major acquisitions were in 2018 with Sayspring, Uru, Magento and Marketo.

Sitecore

  • Hedgehog – a professional services company with Sitecore specific IP
  • Sitecore’s major acquisition of 2018 was StyleLabs, a content marketing software company.

Salesforce

  • Griddable.io – data synchronization service
  • MapAnything – location based workflow software
  • Bonobo AI – conversational software
  • Tableau – data visualization
  • ClickSoftware – field service software

Episerver

  • Insite Software – B2B commerce software
  • Idio – a content personalization and analytics platform
  • Episerver was acquired by Insight Venture Partners in 2018, which is fueling the acquisitions in 2019.

Acquia

  • AgileOne – a customer data platform (CDP)
  • Cohesion – a low-code/no-code development platform
  • Mautic – a marketing automation platform
  • Acquia was acquired by Vista Equity Partners in 2019 as well, which is fueling the growth acquisition strategy as well.

SAP

  • None. All of their recent acquisitions were in 2018, the biggest and notable being Qualtrics.

Oracle

  • CrowdTwist – a loyalty software and service provider
  • Oxygen Systems – a NetSuite SuiteCloud Developer Network partner

OK, we got all that? So if you dig in, clearly the gaps are what is fueling the M&A. Some are rounding out their core offerings. Others are starting to get really niche in what they need to grow with.

So in my opinion, Acquia and Episerver are growing their core offerings to play with more established players such as Adobe and Salesforce. They both had recent ownership changes by private equity and they are fueling the growth needed to expand in their categories as well as grow into new spaces be it upper mid-market or lower enterprise companies.

Adobe’s sole acquisition of 2019 was very specific to content creation and in a world where they want to grow in the upcoming AR/VR space as that takes hold in 2020 and beyond. For Adobe, 2019 and going into 2020 it is all about integrating their big 2018 acquisitions of Magento and Marketo into a holistic platform with the rest of the Adobe Experience Cloud.

Sitecore’s acquisition of Hedgehog turned some heads in their partner ecosystem. Many thought this was going to change their partner relationship. Turns out it wasn’t so much that as it was to gain some proprietary IP and bolster their customer success efforts. The StyleLabs acquisition of 2018 was the big story of gaining a more robust DAM and marketing services technology.

For Salesforce, clearly the big news was the Tableau acquisition. Adding a big set of customers and adding a data visualization solution to their stack turned some heads, but maybe in jealousy rather than the actual acquisition itself. Data is complex. You can make it tell any story. But when you have the right tools to help decision makers make informed decisions, that makes business run faster and more efficiently. The difference of the other acquisitions of Salesforce is that they play in a lot of places with CRM being the hub. So whether it is conversational software or data synchronization or field service software with ClickSoftware, Salesforce is filling in specific gaps, not big ones.

Finally, I threw in SAP and Oracle only because they are big players, but they didn’t make any big noise in 2019. SAP did make some noise with the Qualtrics acquisition in 2018, but time will tell if that was a good move or not in the grand scheme of things.

Where do DXPs go now?

Disclaimer: Ok, this is where I have to make the statement that I work for a company in which we are alliance partners with many of the companies discussed here. However, all the information I’ve shared is public information. The next section is all personal opinion only based on the public information. I do not have insights into any M&A strategy by any of these companies or roadmaps through any of our partner agreements. All of these opinions are that of my own and not my employer.

It’s hard to say exactly where the major DXPs go from here. In some cases, several can fill in more niche gaps from the MarTech landscape. For companies like Adobe who also have other clouds in their product offering such as Advertising Cloud and Document Cloud, the acquisition front could shift to those to increase share of wallet on related services. Adobe Acrobat and Sign are great back-office softwares. Where else can they grow the back-office space? Adobe doesn’t have a CRM, but they do have a strong alliance with Microsoft with growing integrations of their Office 365 suite of services which includes Microsoft Dynamics.

For other companies such as Acquia, Sitecore, and Episerver, the play could be to continue to get to feature parity with Salesforce and Adobe. That’s a tall order as both Adobe and Salesforce play in so many places beyond the typical digital front-end these companies are known for. I personally also think this is why Adobe and Salesforce are public companies and Episerver, Acquia, and Sitecore are all still private. There just isn’t enough of an offering yet to be viable public companies.

For 2020, I think we will say a balance of a few things happen with the major DXPs.

First, those that have a mature offering will focus on integration of their offerings for better customer success and user experience. Marketers want (myself included) solutions that allow us to not have to rely on developers to create everything for us. We want to be able to do stuff on our own and bring in our dev teams as needed for custom experiences and solutions. So bringing these solutions tighter together to allow us to do our jobs better, faster, more efficiently and intelligently will be key.

Second, for the DXPs where they are playing catch up will need to decide how feature parity they want to go, and how they will differentiate themselves. What makes their offerings different than any of the others. Is it simpler to use? Better licensing models? Integrations with one or more of the thousands of other popular MarTech solutions out there?

Third, we will see more M&A. There are still some great solutions out there that are used by thousands of companies that will get gobbled up. I think anything around analytics and insights is fair game. Data visualization is fair game. Customer engagement solutions for better real-time response and data gathering. Really, any platform that is part of the overall customer lifecycle that can add data value to a DXP platform is fair game. Because with all the data privacy and collection laws coming into play, the more the DXPs can own the data source the better.

Final thoughts

I find the MarTech landscape one of the most fascinating spaces in the world of marketing. The technology to allow businesses to discover new audiences, create solutions, market to them, engage, and provide value is nothing short of amazing. It also makes marketing one hell of a tough job in 2020 as well. But as the landscape continues to shift to new channels, ways of engaging customers and prospects change with a changing demographic, the technology needs to keep up too. So whether you make your bet on wearables, voice, AR/VR, 5G, eSports or any of the plethora of channels, the one thing is certain — engaging with a customer base will require technology, data, and creativity. The companies that can offer solutions that fill those areas will find customers. The DXPs that can offer a tightly integrated platform around those areas will also win, but only if it works together and isn’t clunky.

Here’s to 2020 and the rollercoaster ride ahead. Cheers.

This post originally appeared as a LinkedIn published article.

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To Fuel Growth, Fill Your Gaps: Adobe Buys Marketo

There’s been an awakening. Have you felt it? I’m pretty sure every MarTech “Jedi” just felt a tremor in The Force…Adobe is purchasing Marketo for $4.7bn.

Let that sink in.

In a string of acquisitions in the last five years, nothing has come close to this price. SAP bought Hybris for $1.5bn. Salesforce purchased ExactTarget for $2.5 bn. Both in 2013. Salesforce acquired DemandWare for $2.8bn in 2016. Add to the fact that Adobe was in the running for at least two of those companies themselves…it was time to make a statement. And a statement they have made. The mic has been dropped.

via GIPHY

In a world where everyone is racing to create experiences, you need amazing software and practitioners to do it. You can either assemble a hodgepodge of solutions, or go with entire platforms (integrated or not). You can tell your IT dept you are going SaaS or IT can tell you that you need to go “On Prem.” You could decide to build the solutions yourself. In any scenario there are pros and cons. For every company, a decision on how you assemble your “stack” is very individual. There is no shortage of options for any company to use. The MarTech space is very, VERY crowded.

Over the last decade Adobe has been making changes and moves to assemble a suite of creative solutions and now marketing solutions. No other company can take you through the entire lifecycle of content creation to production to marketing to analysis than Adobe. No small feat. Not with out it’s own set of challenges. With any acquisition, integrating technologies takes planning, time, and sometimes hard work. When you are looking for growth, you need to identify where your gaps are and determine where you can acquire those skills or technology. You can either build, or buy. Adobe has done both.

Fill Your Gaps – Don’t Mind Them

I’ve been in several discussions when news broke last week that Adobe was in talks with Marketo. These sidebar conversations ranged from “Whoa, that’s interesting!” to “Doesn’t Marketo compete with Adobe Campaign?” Worthy conversations to say the least. It was a little bit of a head scratcher once the shock of name dropping of the two companies in the same sentence with the word “acquire” in there wore off. What will Adobe do with Marketo and why did they buy them? The answer is “fill gaps.” Yes, Adobe purchased Neolane in 2013 and has since rebranded it Adobe Campaign and has two versions of it. One is a grown version of the legacy Neolane product and the other is a rebuilt, rewritten version of Neolane in the cloud. Both versions do compete with Marketo to a degree. But, Marketo has features Campaign doesn’t, namely lead management (scoring, etc), account based marketing features, marketing attribution, data management and more. If you are a marketer in 2018, these are core tools in your current and future strategies. If you don’t have them implemented, they should be in your roadmap. Adobe Campaign lacks these features and I’m sure it was noticed.

When it comes to building, Adobe has their “Marketing Cloud Platform” which is a set of services, APIs, and other connective tissue beneath the surface of the larger solutions. There is no shortage of innovation going on there, which is where Adobe Sensei was born, their AI solution.

Building an Empire Means Always Evolving

Just over a week ago Forbes published the article “Why $128 Billion Adobe Is Running Scared“. Wait, what? Running scared? They are on top of every possible category as a leader for their technology. Why in the world are they running scared? Well, when you’re on top, everyone is coming for you. As Peter Carbonara wrote in that article:

The explanation for the expensive expansionism: In the rapidly changing world of software, small pieces of turf are hard to defend. There is always the risk that some larger company will either wrap a competing product into a larger suite you don’t offer or, worse, give away for free what you’re selling.

The target can’t be bigger for Adobe on their back. While it might not be advised to make two major acquisitions in the same year, let alone within four months, sometimes you need to evolve to keep pushing and leading the pack. There are few gaps left Adobe has to fill. They bolstered their marketing automation solutions today, and lack of commerce a few months ago with the purchase of Magento. Now integrating these solutions into the Experience Cloud is where Adobe can shine, bring value add, and give their customers a robust suite of solutions to connect with their customers.

65,000 Users Can’t Be Wrong

If you thought Adobe had an ecosystem of users, partners, and advocates, well…Marketo does too. The Marketing Nation conference is one of the marketing conferences to go to every year. Their customers are invested in their platform because it is such an essential tool to their “stack”. If you are going beyond basic email marketing and beyond a SMB, there are few tools to graduate to. It’s Hubspot, Marketo, CheetahDigital, and maybe a few more. To say that the Marketo Nation will fit in with the Adobe Marketing Nation is probably an understatement. I also think many, many Marketo customers use Adobe Experience Cloud solutions as well. So there is probably a more natural fit than one might think.

So, What’s Left to Buy?

So what’s left? In my opinion, CRM. One could argue that Marketo helps fill that hole, and it does a little. It buys them time, but I still think CRM is still a gap. Another gap is going to be where experiences traverse into voice, IoT, and AR/VR. While I know they have made some small purchases here, and they are indeed innovating, it has yet to be seen where it really shapes up and makes a mark. Could a DAM purchase be in their future? Adobe assets has become a solid solution, but it still has some features it lacks. That is also a byproduct of the state of content strategy, headless CMS, and where an “asset” isn’t just a document or picture. Finally, data visualization and other front-office tools. For now, their strategic relationship with Microsoft fills those holes.

So now we sit and wait. How will Oracle, Salesforce, SAP, and others respond to this news? Who knows. All I know is that Adobe Summit is going to be one hell of a time in March 2019.

Disclaimer: My employer, ICF, is a Premier Adobe Solutions Partner. The thoughts and opinions conveyed here are of my own. I do not have access to road maps or acquisition information.

This article was first published on LinkedIn.  

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Adobe Buys Magento: A Good Fit or the Best of What’s Left?

Disclosure: I work for a company that is a Premier partner of Adobe and have partnerships with other vendors mentioned in this article. I do not have access to technical or product roadmaps or have any insights into M&A for any of them. The following is purely my thoughts and opinions and do not represent my employer’s opinion.

Last week Adobe announced that they were purchasing Magento, an eCommerce platform for $1.67Bn. The company has been bought and sold twice previously. eBay bought Magento for $180M, then sold it as part of their enterprise commerce platform to private equity firm Primera. We’ve had a week to digest what this acquisition means for Adobe and their overall Experience Cloud Solutions and what it means for Magento customers, who are primarily not enterprise. Let’s dig in.

The Need for Owning a Commerce Solution

It’s no secret that Adobe needed to do something around a commerce solution. While they have been filling out the other parts of their Experience Cloud with solutions such as voice with Sayspring, video advertising with TubeMogul and user-generated content with LiveFyre, commerce was a place they have flirted with in the past, but never got over the finish line. With a focus on the enterprise market, Adobe over the last decade only had a few options to really pursue — DemandWare, and Hybris. I can only assume Adobe did explore those options but as we know, Salesforce nabbed DemandWare two years ago and Hybris went to SAP five years ago. With those two companies off the market, a big hole was left in the marketplace from an M&A perspective.

Since then, Adobe seemed to focus on the remaining commerce platforms with what appeared to be more integration partnerships while they figured out their next steps. ElasticPath had a run at it, but have now appeared to be strategically aligned to BloomReach. If you look at the Adobe Exchange for their Experience Cloud, you will see there are plenty of commerce vendors that integrate with Adobe Experience Manager (AEM) such as Digital River, Elastic Path, IBM WebSphere Commerce, SAP Hybris, CloudCraze, Agility Multichannel (a PIM system), commercetools, and yes, Magento. So to say that creating commerce experiences within the Adobe Experience Cloud couldn’t be done before is clearly not the case. In fact, companies had options one way or another.

With all of those solutions out there already integrating with the Experience Cloud, why did they need to purchase one? I think there are a few reasons.

  1. It is always better to be in the driver’s seat of any major component of an ecosystem you are either building out or supporting. Many of Adobe’s customers have a commerce component to their Marketing Technology stacks and integration at times only goes so far.
  2. Products and commerce complement each other but are indeed different. While many companies can put product information into AEM and use taxonomies and other metadata to manage the assets, it’s not really built for commerce. It’s meant for content. But when you have product pages and search results, AEM shines. So like peanut butter and jelly, they need to go together.
  3. Their customers were asking for it. There are plenty of Adobe customers who own the entire Experience Cloud, but when it came to this part of their needs, customers had to go elsewhere. While that isn’t always the case and not everyone needs commerce, at the enterprise level which is where they play the most, many do.
  4. More revenue. At the end of the day, it is a missing piece of revenue from a subscription model for their software. So grab that last piece of the pie.

Looking at these tools above who are already integrating into the Experience Cloud, really only one tool could have been viable for an acquisition, and that was Magento. The acquisition does still raise a few eyebrows for a few reasons, but none that haven’t already been overcome by Adobe in the past.

PHP or Java or Cloud or What?

When we first heard about the acquisition in our office some of the first reactions were, “well isn’t Magento PHP based?” And it is. Even Forrester analyst Ted Schadler raised the question on Twitter.

Adobe finally found a commerce platform to buy. I like that it’s plugging a hole, particularly for manufacturers just starting out in commerce. But tell me how PHP/cloud Magento and Java/to-the-datacenter-born AEM are going to integrate? – @TedSchadler

So the short answer that I think all of us are responding with is clearly it will be API based….for now. There is a precedence at Adobe to purchase non-Java based solutions and spend the time and energy to rebuild them in Java and the most recent and still dual code-based solution is Adobe Campaign. When Adobe bought Neolane years ago it was a .NET solution and a fat client even. What is now Adobe Campaign “Classic” is still this .NET solution. The new Adobe Campaign Standard is the rebuilt Java/cloud-based solution that is working towards seamless integration with the rest of the Experience Cloud. (Also, again one of those situations where Adobe didn’t have a lot of choices after other email campaign tools such as ExactTarget and SilverPop were picked up by other companies). Whether Adobe decides to rebuild Magento into a Java/Cloud solution is yet to be seen. It could if it wanted to.

Headless is the New Black

Notice I didn’t say eCommerce above, but just commerce. That’s because as we look at the future of experiences, it’s not always going to be about the traditional “e” solutions. In fact, we are hearing more and more about the headless experience. That actually is more of where Adobe is now headed when you think of AEM anyway, as a headless content management system. So to purchase a commerce solution that can power any experience from web to mobile to in-store to voice to AR and VR, it’s not going to be about just one channel. So be on the lookout for where this goes. I expect to hear more about “commerce” as the integration discussion, not eCommerce.

Taking Advantage of Sensei

AI be damned that it isn’t the biggest buzzword and probably misunderstood in the industry right now. That being said, Adobe sure has a gem on their hands with Sensei. Content, commerce, and data are the three biggest assets in building out smart AI and Machine Learning to build personalized experiences. It won’t just be about upselling/cross-selling. This is about delivering personalization at scale down to the individual. The “segment of one.” Sensei is already doing a lot in the Cloud for Adobe. Adding commerce data (products, pricing, attributes, etc) will just empower marketers and merchandisers to do more.

So…Good Buy or Best of the Rest?

Missing out on the larger, enterprise platforms like DemandWare and Hybris were stingers, for sure. However, those were big, hairy platforms and integrating enterprise to enterprise is no walk in the park. Going for something smaller, in a different market segment like mid-market might not be all that bad. There are only so many enterprise clients out there and three major experience platforms all vying for their attention. So maybe mid-market won’t be a bad move.

Adobe also has a history of purchasing solutions that have deep open source roots. Day Software, what is now AEM, was built on open source standards like JCR and OSGi. There is still a very deep developer community around AEM and having a deep community supporting Magento could be very good.

I think time will tell, but as we’ve seen with Adobe, there are very few instances where an acquisition doesn’t end up paying off for them. It will take some time to get the Magento platform integrated deeper into the Experience Cloud. It will take time to grow into enterprise clients more holistically. It will take time for the strategy to really come to fruition. In any case, Adobe needed to do something, and Magento is as good of a purchase as any other.

NOTE: A version of this was originally published on LinkedIn.