Adobe 2010 Annual Report Download - page 24

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action taken in subsequent visits) or success over time (lifetime value of customer) as well as comparing the relative
effectiveness of different marketing channels (attribution). Business success metrics can also vary based on the
industry or vertical market—for example, media companies drive engagement to optimize subscriptions and online
advertising revenue, whereas retailers and e-commerce companies focus on promotions and maximizing online
purchases. Online businesses utilize a large and growing number of complex and diverse advertising and
communication channels to market to customers, including display advertising, paid and natural search advertising,
e-mail, social media marketing, affiliate marketing, blogs, podcasts, video, RIAs and comparison shopping engines,
as well as traditional offline initiatives. The emergence of multi-channel marketing initiatives, which combine
traditional offline marketing initiatives such as television, print, magazine, newspapers, radio and catalog with
online marketing initiatives, makes the measurement and analysis of online activity more challenging, but presents
additional opportunities to optimize results. For example, businesses want to measure and understand the impact of
their advertising initiatives across all these channels, not only to determine how much credit should be given to a
particular channel and to understand cross-promotional effectiveness, but more importantly to optimize their
advertising spending and make adjustments in the way channels are utilized and align the amount of resources that
are allocated to each of them.
Given the market trends described above, we believe the combination of our creative tools and Omniture’ s solutions
help customers to more efficiently and effectively measure, analyze and optimize those experiences—creating a complete
feedback loop. With this broad platform, we believe there is a unique opportunity for Adobe to deliver an end-to-end
workflow that will allow customers to create, deliver, monetize, and optimize the impact and business results of their content
and assets.
Omniture Business Summary
We acquired Omniture in October 2009. As one of the largest SaaS businesses, our Omniture business segment
processes over one trillion transactions per quarter in a hosted environment for thousands of customers around the world.
Like the rest of our business segments, Omniture revenue was adversely affected during 2009 due to the macro-economic
environment. However, the business stabilized in the second half of 2009 and growth returned in 2010—mirroring the growth
in online advertising and e-commerce.
Our Omniture revenue in fiscal 2010 was affected by the write-down of prior Omniture deferred revenue due to
purchase accounting rules for combining software companies. However, during fiscal 2010, as we more fully integrated the
Omniture business into Adobe and we invested in the go-to-market capabilities of our sales force responsible for our
Omniture product line, we achieved record bookings levels with our Omniture business during the year. In addition, we
continued to achieve high retention rates during the year as customer contracts came up for renewal.
Our flagship Omniture product, SiteCatalyst, anchors our analytics business and represented more than 50% of
Omniture revenue reported for fiscal 2010. The percentage of revenue represented by SiteCatalyst has been shrinking, which
reflects success against our effort to provide additional types of services beyond analytics which integrate into our Online
Marketing Suite. Revenue from these additional services grew steadily and represented nearly a third of our Omniture
revenue in fiscal 2010. Our Omniture professional services, including training and consulting services, comprised the
remaining portion of our Omniture revenue during the year.
Omniture Strategy
In the coming year, we expect to build upon the momentum we achieved in fiscal 2010 by enabling our customers to
capture, store and analyze information generated by their Websites and other sources and to gain critical business insights
into the performance and efficiency of marketing and sales initiatives and other business processes. We intend to help our
customers utilize this information to optimize their advertising spend across digital advertising channels, automate the
targeting and delivery of content and marketing offers on a Website, as well as the broader Internet, and test site design and
navigational elements to optimize the user experience and their revenue opportunities. We will enhance our services by
providing customers with real-time access to online business information through interactive dashboards, the ability to
integrate that information with a broad set of other data sources, and generate flexible reports using real-time and historical
data and the ability to measure, automate and optimize critical online processes. We also plan to enhance our capabilities to
provide user and system controls that help manage privacy and keep our products within regulatory compliance guidelines, as
new privacy standards emerge in the industry.
We also believe we can accelerate the growth of our Omniture business by expanding the Omniture go-to-market
strategy to include new geographies and vertical markets where Adobe has a strong presence. We also believe we can grow
the business by expanding what we offer in the Online Marketing Suite, including improving integration with our creative