The biggest news from the past month was the acquisition of E-Commerce giant Magento by Adobe. Through a surprise announcement, Brad Rencher, the Executive VP of Adobe Digital Marketing stated that the Multinational Software Company based in San Jose, California has started the process of acquiring Magento for an estimated price tag of $1.68 billion. This acquisition would serve to bolster Adobe’s current Cloud offering with Magento’s robust open-source E-Commerce platform which is supported by more than 300,000 developers and 1150+ solution and technology partners.
What is it for Magento Customers?
The most pressing question on our minds is, what does this mean for the businesses that use Magento for their E-Commerce services?
The union between the Magento, the world’s largest E-Commerce platform and Adobe, which has expertise in designing and delivering great digital experiences introduces an exciting set of possibilities for users of the platform and Magento as a whole.
The deal means that Magento would be integrated into Adobe’s Experience Cloud, a comprehensive set of cloud services designed to give enterprises everything they need to deliver exceptional customer experiences. “Embedding commerce into the Adobe Experience Cloud with Magento enables Adobe to make every moment personal and every experience shoppable,” said VP Brad Rencher.
Adobe’s Cloud for Magento
The Adobe Experience Cloud includes services such as Adobe Marketing, Advertising, and Analytics.
This combined with the powerful tools provided by the Magento platform, with thousands of pre-built extensions, including payment, shipping, tax, and logistics allow a high level of flexibility for businesses to quickly customize their commerce abilities for their business needs.
This would enhance the ability of every business to create and deliver to their clients a more compelling E-Commerce experience whether it is Business to Consumer (B2C) or Business to Business (B2B)and allow them to engage at every point of their journey.
The expected end result is a single cloud platform that will allow developers to design the look and feel of an E-Commerce site while also managing content flow, payments, analyze performance and measure the effectiveness of the said site. The outcome being, a way to provide a seamless and a more consistent user journey than we can today.
According to Magento CEO Mark Lavelle, the sale would work to accelerate his company’s commerce progress and reflected a shared vision between the two firms, which were partners before the transaction.
Magento had first partnered with Adobe in 2016 to provide a joint solution to enable merchants to better design and personalize the E-Commerce experience for their customers, with an initial set of partners including WebQem, Accenture, Arvato, Infield Digital, MRM McCann/Optaros, Perficient, Razorfish, and Sapient. With this merger, the capability of Magento to deliver a rich customer experience is likely to increase exponentially.
Current Magento customers include Brands such as Canon, Rosetta Stone, Helly Hansen and Paul Smith. Joint customers shared by Magento and Adobe include the likes of Nestle, Coca-Cola, and Cathay Pacific.
Adobe’s 3rd biggest Acquisition and Position
The acquisition, which will be the third biggest by the Photoshop software provider after Macromedia in 2005 and Omniture, a web analytics company, in 2009, has already seen ripples across the stock market, with rival E-Commerce platform Shopify slipping as much as 4% and Adobe’s shares rising by 1% to $240.50 following the announcement. Adobe stands to gain access to Magento’s expansive mid-market and large corporate customers along with a foothold in online and physical transactions. What this would mean for the market in the long term, as Adobe offers increasing competition to companies such as Oracle and Salesforce in the sphere of cloud services, is yet to be seen.
Upon completion of the merger, CEO Mark Lavelle is reported to continue leading Magento, as a part of Adobe’s Digital Experience division while reporting to Adobe’s VP, Brad Rencher.
The deal is expected to close by the third quarter of Adobe’s fiscal year. Until then, each company will continue to operate independently.
We can look forward to more news on the initiatives arising from the merger as the transaction closes in the upcoming months.