Published March 26, 2014 by Frankfurter Allgemeine Zeitung
Translation of original article by Martin Gropp
Not too long ago, most software providers sold their programs on CD; only a few were selling products over the Internet. Even the U.S.-based company Adobe, developer of the PDF file format and the accompanying Reader software, was still doing well with these old ways. And so things remained, even though the basic version of the Reader had long been available as a free software on the Internet. It was not until 2009 that the Adobe board of directors mentioned the concept of ‘software-as-a-service’ in their annual letter to shareholders, and even then it was only with the remark that demand for software services on the Internet was still a “budding market.”
Now, these delicate blossoms have bloomed into a billion-dollar business. The Boston Consulting Group estimated the value of software-as-a-service (SaaS) at $15 billion last year, and predicted that this market would grow three times as fast as the market for traditional software. Phenomena such as cloud computing (the decentralized use of computing power over the Internet) and big data (the process of analyzing massive quantities of data) put the software industry under a lot of pressure to adapt and innovate. Software providers must adapt their programs to the needs of different companies. The software must be able to operate on desktop computers in an office as well as on smartphones and tablets on the go. Ideally, employees should be able to access important data from anywhere.
And it is in this context that Adobe began the new collaboration that it announced on Tuesday. The company will soon be working together with German software provider SAP to distribute its digital marketing solution. As part of this partnership, SAP will be offering companies the Marketing Cloud together with its database solution, Hana, enabling these companies to analyze large quantities of their data at fast speeds. According to a statement, the goal of combining these two solutions is to empower business clients to be able to “analyze data from different marketing channels and interact with customers in real-time.” The company’s new business partner promises that this will help companies improve their business.
According to Senior VP Brad Rencher, who heads up Adobe’s Digital Marketing Business Unit, the Hana solution will provide retailers with “data-driven insights” that will allow them to increase their revenue, both online and in physical stores. The in-memory technology utilized in the Hana database system is particularly well-suited to the challenge of consolidating and analyzing data from different sources, for example, from social networks or the company’s own customer service databases.
According to Jonathan Becher, who oversees marketing at SAP, companies will be expected to make more and more decisions in real-time in the future. Becher refers to an example involving a chain of British toy retailers. Even otherwise loyal customers now take out their smartphones to check the competitors’ prices while still in the store. The key is to reach these customers using individualized offers sent via digital channels.
The SAP manager sees this cooperation with Adobe as a sign of things to come in the industry. “These types of collaborations are going to become more popular,” explains Becher. Becher doesn’t see it as competing against oneself and potentially losing business, even though his own company also produces solutions for digital marketing. “This way we all get a piece of the pie.” And at the moment, that piece seems to be getting larger rather than smaller.