Adobe Purchase of Efficient Frontier Continues Shift for Company
Adobe used to be about tools. Tools that help people create things in an online world. Reader, Photoshop, Flash and other well known brands defined the company. That is until recently. The company has made many acquisitions and the shift toward a data / service orientation rather than the seller of products is made very obvious by the their latest acquisition Efficient Frontier.
As Bloomberg Businessweek reports
Adobe Systems Inc. said it would buy online-advertising company Efficient Frontier to gain software that lets marketers place ads on Google Inc.’s and Facebook Inc.’s websites.
The deal would expand Adobe’s palette of tools for online advertisers and complement software it acquired with Omniture Inc. two years ago, Adobe said in a statement. Closely held Efficient Frontier, based in Sunnyvale, California, sells software that lets advertisers buy keywords on Google, place ads on Facebook, and purchase so-called display ads around the Web. Adobe, based in San Jose, California, didn’t disclose the price and said the transaction would be completed by February.
I remember several years ago when I was selling SEO services, Efficient Frontier was big news. Their scientific approach (portfolio theory) to placing ads for large Adwords advertisers received a lot of attention. They are not as public with their efforts as they once were (although they have an impressive client list which includes Discover Financial Services, salesforce.com and many more and they are involved in somewhere in the neighborhood of a billion dollars of client ad spend) since the space they helped to develop has become cluttered with many me too types. This acquisition by Adobe, however, signals something different for sure.
With Efficient Frontier and Omniture as part of their arsenal the company is getting away from the threat of creating tools that are the cornerstone one day and tagged for obsolescence the next like the rapid and very recent decline of Flash. By focusing on services that companies need to manage ongoing mission critical actions like online advertising Adobe is changing at least a portion of its business to position itself as a tools and service provider that could be a more stable model than depending on software licensing year in and year out.
This will be an interesting one to watch as more and more companies find themselves needing to reinvent how they do business in the Internet’s new world order.