At the beginning of every year, I publish a retrospective that looks back at the previous year at Acquia. I also discuss the changing dynamics in our industry, focusing on Content Management Systems (CMS) and Digital Experience Platforms (DXP).
If you'd like, you can read all of my retrospectives for the past 15 years: 2022, 2021, 2020, 2019, 2018, 2017, 2016, 2015, 2014, 2013, 2012, 2011, 2010, 2009.
Resilience and growth amid market turbulence
At the beginning of 2023, interest rates were 4.5%. Technology companies, investors, and PE firms were optimistic, anticipating modest growth. However, as inflation persisted and central banks raised rates more than expected, this optimism dwindled.
The first quarter also saw a regional bank crisis, notably the fall of Silicon Valley Bank, which many tech firms, including Acquia, relied on. Following these events, the market's pace slowed, and the early optimism shifted to a more cautious outlook.
Despite these challenges, Acquia thrived. We marked 16 years of revenue increase, achieved record renewal rates, and continued our five-year trend of rising profitability. 2023 was another standout year for Acquia.
One of our main objectives for 2023 was to expand our platform through M&A. However, tighter credit lending, valuation discrepancies, and economic uncertainty complicated these efforts. By the end of 2023, with the public markets rebounding, the M&A landscape showed slight improvement.
In November, we announced Acquia's plan to acquire Monsido, a platform for improving website accessibility, content quality, SEO, privacy, and performance. The acquisition closed last Friday. I'm excited about expanding the value we offer to our customers and look forward to welcoming Monsido's employees to Acquia.
Working towards a safer, responsible and inclusive digital future
Looking ahead to 2024, I anticipate these to be the dominant trends in the CMS and DXP markets:
- Converging technology ecosystems: MACH and Jamstack are evolving beyond their original approaches. As a result, we'll see their capabilities converge with one another, and with those of traditional CMSes. I wrote extensively about this in Jamstack and MACH's journey towards traditional CMS concepts.
- Navigating the cookie-less future: Marketers will need to navigate a cookie-less future. This means organizations will depend more and more on data they collect from their own digital channels (websites, newsletters, video platforms, etc).
- Digital decentralization: The deterioration of commercial social media platforms has been a positive development in my opinion. I anticipate users will continue to reduce their time on these commercial platforms. The steady shift towards open, decentralized alternatives like Mastodon, Nostr, and personal websites is a welcome trend.
- Growth in digital accessibility: The importance of accessibility is growing and will become even more important in 2024 as organizations prepare for enforcement of the European Accessibility Act in 2025. This trend isn't just about responding to legislation; it's about making sure digital experiences are inclusive to everyone, including individuals with disabilities.
- AI's impact on digital marketing and websites: As people start getting information directly from Artificial Intelligence (AI) tools, organic website traffic will decline. Just like with the cookie-less future, organizations will need to focus more on growing their own digital channels with exclusive and personalized content.
- AI's impact on website building: We'll witness AI's evolution from assisting in content production to facilitating the building of applications. Instead of laboriously piecing together landing pages or campaigns with a hundred clicks, users will simply be able to guide the process with AI prompts. AI will evolve to become the new user interface for complex tasks.
- Cybersecurity prioritization: As digital landscapes expand, so do vulnerabilities. People and organizations will become more protective of their personal and privacy data, and will demand greater control over the sharing and storage of their information. This means a growing focus on regulation, more strict compliance rules, automatic software updates, AI-driven monitoring and threat detection, passwordless authentication, and more.
- Central content and data stores: Organizations are gravitating more and more towards all-in-one platforms that consolidate data and content. This centralization enables businesses to better understand and anticipate customer needs, and deliver better, personalized customer experiences.
While some of these trends suggest a decline in the importance of traditional websites, others trends point towards a positive future for websites. On one side, the rise of AI in information gathering will decrease the need for traditional websites. On the other side, the decline of commercial social media and the shift to a cookie-less future suggest that websites will continue to be important, perhaps even more so.
What I like most about many of these trends is that they are shaping a more intuitive, inclusive, and secure digital future. Their impact on end-users will be profound, making every interaction more personal, accessible, and secure.
However, I suspect the ways in which we do digital marketing will need to change quite a bit. Marketing teams will need to evolve how they generate leads. They'll have to use privacy-friendly methods to develop strong customer relationships and offer more value than what AI tools provide.
This means getting closer to customers with content that is personal and relevant. The use of intent data, first-party data and predictive marketing for determining the "next best actions" will continue to grow in importance.
It also means that more content may transition into secure areas such as newsletters, members-only websites, or websites that tailor content dynamically for each user, where it can't be mined by AI tools.
All this bodes well for CMSes, Customer Data Platforms (CDPs), personalization software, Account-Based Marketing (ABM), etc. By utilizing these platforms, marketing teams can better engage with individuals and offer more meaningful experiences. Acquia is well-positioned based on these trends.
Reaffirming our DXP strategy, with a focus on openness
On a personal front, my title expanded from CTO to CTO & Chief Strategy Officer. Since Acquia's inception, I've always played a key role in shaping both our technology and business strategies. This title change reflects my ongoing responsibilities.
Until 2018, Acquia mainly focused on CMS. In 2018, we made a strategic shift from being a leader in CMS to becoming a leader in DXP. We have greatly expanded our product portfolio since then. Today, Acquia's DXP includes CMS, Digital Asset Management (DAM), Customer Data Platform (CDP), Marketing Automation, Digital Experience Optimization, and more. We've been recognized as leaders in DXP by analyst firms including Gartner, GigaOm, Aragon Research and Omdia.
As we entered 2023, we felt we had successfully executed our big 2018 strategy shift. With my updated title, I spearheaded an effort to revise our corporate strategy to figure out what is next. The results were that we reaffirmed our commitment to our core DXP market with the goal of creating the best "Open DXP" in the market.
We see "Open" as a key differentiator. As part of our updated strategy, we explicitly defined what "Open" means to us. While this topic deserves a blog post on its own, I will touch on it here.
Being "Open" means we actively promote integrations with third-party vendors. When you purchase an Acquia product, you're not just buying a tool; you're also buying into a technology ecosystem.
However, our definition of "Open" extends far beyond mere integrations. It's also about creating an inclusive environment where everyone is empowered to participate and contribute to meaningful digital experiences in a safe and secure manner. Our updated strategy, while still focused on the DXP ecosystem, champions empowerment, inclusivity, accessibility, and safety.
A slide from our strategy presentation, summarizing our definition of an Open DXP. The definition is the cornerstone of Acquia's "Why"-statement.
People who have followed me for a while know that I've long advocated for an Open Web, promoting inclusivity, accessibility, and safety. It's inspiring to see Acquia fully embrace these principles, a move I hope will inspire not just me, but our employees, customers, and partners too. It's not just a strategy; it's a reflection of our core values.
It probably doesn't come as a surprise that our updated strategy aligns with the trends I outlined above, many of which also point towards a safer, more responsible, and inclusive digital future. Our enthusiasm for the Monsido acquisition is also driven by these core principles.
Needless to say, our strategy update is about much more than a commitment to openness. Our commitment to openness drives a lot of our strategic decisions. Here are a few key examples to illustrate our direction.
- Expanding into the mid-market: Acquia has primarily catered to the enterprise and upper mid-market sectors. We're driven by the belief that an open platform, dedicated to inclusivity, accessibility, and safety, enhances the web for everyone. Our commitment to contributing to a better web is motivating us to broaden our reach, making expanding into the mid-market a logical strategic move.
- Expanding partnerships, empowering co-creation: Our partnership program is well-established with Drupal, and we're actively expanding partnerships for Digital Asset Management (DAM), CDP, and marketing automation. We aim to go beyond a standard partner program by engaging more deeply in co-creation with our partners, similar to what we do in the Open Source community. The goal is to foster an open ecosystem where everyone can contribute to developing customer solutions, embodying our commitment to empowerment and collaboration. We've already launched a marketplace in 2023, Acquia Exchange, featuring more than 100 co-created solutions, with the goal of expanding to 500 by the end of 2024.
- Be an AI-fueled organization: In 2023, we launched numerous AI features and we anticipate introducing even more in 2024. Acquia already adheres to responsible AI principles. This aligns with our definition of "Open", emphasizing accountability and safety for the AI systems we develop. We want to continue to be a leader in this space.
Stronger together
We've always been very focused on our greatest asset: our people. This year, we welcomed exceptional talent across the organization, including two key additions to our Executive Leadership Team (ELT): Tarang Patel, leading Corporate Development, and Jennifer Griffin Smith, our Chief Market Officer. Their expertise has already made a significant impact.
Eight awards for "Best Places to Work 2023" in various categories such as IT, mid-size workplaces, female-friendly environments, wellbeing, and appeal for millennials, across India, the UK, and the USA.
In 2023, we dedicated ourselves to redefining and enhancing the Acquia employee experience, committing daily to its principles through all our programs. This focus, along with our strong emphasis on diversity, equity, and inclusion (DEI), has cultivated a culture of exceptional productivity and collaboration. As a result, we've seen not just record-high employee retention rates but also remarkable employee satisfaction and engagement. Our efforts have earned us various prestigious "Best Place to Work" awards.
Customer-centric excellence, growth, and renewals
Our commitment to delivering great customer experiences is evident in the awards and recognition we received, many of which are influenced by customer feedback. These accolades include recognition on platforms like TrustRadius and G2, as well as the prestigious 2023 CODiE Award.
Acquia received 32 awards for leadership in various categories across its products.
As mentioned earlier, we delivered consistently excellent, and historically high, renewal rates throughout 2023. It means our customers are voting with their feet (and wallets) to stay with Acquia.
Furthermore, we achieved remarkable growth within our customer base with record rates of expansion growth. Not only did customers choose to stay with Acquia, they chose to buy more from Acquia as well.
To top it all off, we experienced a substantial increase in the number of customers who were willing to serve as references for Acquia, endorsing our products and services to prospects.
Many of the notable customer stories for 2023 came from some of the world's most recognizable organizations, including:
- Nestlé: With thousands of brand sites hosted on disparate technologies, Nestlé brand managers had difficulty maintaining, updating, and securing brand assets globally. Not only was it a challenge to standardize and govern the multiple brands, it was costly to maintain resources for each technology and inefficient with work being duplicated across sites. Today, Nestlé uses Drupal, Acquia Cloud Platform and Acquia Site Factory to face these challenges. Nearly all (90%) of Nestlé sites are built using Drupal. Across the brand's entire portfolio of sites, approximately 60% are built on a shared codebase – made possible by Acquia and Acquia Site Factory.
- Novartis: The Novartis product sites in the U.S. were fragmented across multiple platforms, with different approaches and capabilities and varying levels of technical debt. This led to uncertainty in the level of effort and time to market for new properties. Today, the Novartis platform built with Acquia and EPAM has become a model within the larger Novartis organization for how a design system can seamlessly integrate with Drupal to build a decoupled front end. The new platform allows Novartis to create new or move existing websites in a standardized design framework, leading to more efficient development cycles and more functionality delivered in each sprint.
- US Drug Enforcement Administration: The U.S. DEA wanted to create a campaign site to increase public awareness regarding the increasing danger of fake prescription pills laced with fentanyl. Developed with Tactis and Acquia, the campaign website One Pill Can Kill highlights the lethal nature of fentanyl. The campaign compares real and fake pills through videos featuring parents and teens who share their experiences with fentanyl. It also provides resources and support for teens, parents, and teachers and discusses the use of Naloxone in reversing the effects of drug overdose.
- Cox Automotive: Cox Automotive uses first-party data through Acquia Campaign Studio for better targeted marketing. With their Automotive Marketing Platform (AMP) powered by Acquia, they access real-time data and insights, delivering personalized messages at the right time. The results? Dealers using AMP see consumers nine times more likely to purchase within 45 days and a 14-fold increase in sales gross profit ROI.
I'm proud of outcomes like this: it show how valuable our DXP is to our customers.
Product innovation
In 2023, we remained focused on solving problems for our current and future customers. We use both quantitative and qualitative data to assess areas of opportunities and run hypothesis-driven experiments with design prototypes, hackathons, and proofs-of-concept. This approach has led to hundreds of improvements across our products, both by our development teams and through partnerships. Below are some key innovations that have transformed the way our customers operate:
- We released many AI features in 2023, including AI assistants and automations for Acquia DAM, Acquia CDP, Acquia Campaign Studio, and Drupal. This includes: AI assist during asset creation in Drupal and Campaign Studio, AI-generated descriptions for assets and products in DAM, auto-tagging in DAM with computer vision, next best action/channel predictions in CDP, ML-powered customer segmentation in CDP, and much more.
- Our Drupal Acceleration Team (DAT) worked with the Drupal community on major upgrade of the Drupal field UI, which makes it significantly faster and more user-friendly to perform content modeling. We also open sourced Acquia Migrate Accelerate as part of the run-up to the Drupal 7 community end-of-life in January 2025. Finally, DAT contributed to a number of major ongoing initiatives including Project Browser, Automatic Updates, Page Building, Recipes, and more that will be seen in later versions of Drupal.
- We launched a new trial experience for Acquia Cloud Platform, our Drupal platform. Organizations can now explore Acquia's hosting and developer tools to see how their Drupal applications perform on our platform.
- Our Kuberbetes-native Drupal hosting platform backed by AWS, Acquia Cloud Next, continued to roll out to more customers. Over two-thirds of our customers are now enjoying Acquia Cloud Next, which provides them the highest levels of performance, self-healing, and dynamic scaling. We've seen a 50% decrease in critical support tickets since transitioning customers to Acquia Cloud Next, all while maintaining an impressive uptime record of 99.99% or higher.
- Our open source marketing automation tool, Acquia Campaign Studio, is now running on Acquia Cloud Next as its core processing platform. This consolidation benefits everyone: it streamlines and accelerates innovation for us while enabling our customers to deliver targeted and personalized messages at a massive scale.
- We decided to make Mautic a completely independent Open Source project, letting it grow and change freely. We've remained the top contributor ever since.
- Marketers can now easily shape the Acquia CDP data model using low-code tools, custom attributes and custom calculations features. This empowers all Acquia CDP users, regardless of technical skill, to explore new use cases.
- Acquia CDP's updated architecture enables nearly limitless elasticity, which allows the platform to scale automatically based on demand. We put this to the test during Black Friday, when our CDP efficiently handled billions of events. Our new architecture has led to faster, more consistent processing times, with speeds improving by over 70%.
- With Snowflake as Acquia's data backbone, Acquia customers can now collaborate on their data within their organization and across business units. Customers can securely share and access governed data while preserving privacy, offering them advanced data strategies and solutions.
- Our DAM innovation featured 47 updates and 13 new integrations. These updates included improved Product Information Management (PIM) functionality, increased accessibility, and a revamped search experience. Leveraging AI, we automated the generation of alt-text and product descriptions, which streamlines content management. Additionally, we established three partnerships to enhance content creation, selection, and distribution in DAM: Moovly for AI-driven video creation and translation, Vizit for optimizing content based on audience insights, and Syndic8 for distributing visual and product content across online commerce platforms.
- With the acquisition of Monsido and new partnerships with VWO (tools for optimizing website engagement and conversions) and Conductor (SEO platform), Acquia DXP now offers an unparalleled suite of tools for experience optimization. Acquia already provided the best tools to build, manage and operate websites. With these additions, Acquia DXP also offers the best solution for experience optimization.
- Acquia also launched Acquia TV, a one-stop destination for all things digital experience. It features video podcasts, event highlights, product breakdowns, and other content from a diverse collection of industry voices. This is a great example of how we use our own technology to connect more powerfully with our audiences. It's something our customers strive to do everyday.
Conclusion
In spite of the economic uncertainties of 2023, Acquia had a remarkable year. We achieved our objectives, overcame challenges, and delivered outstanding results. I'm grateful to be in the position that we are in.
Our achievements in 2023 underscore the importance of putting our customers first and nurturing exceptional teams. Alongside effective management and financial responsibility, these elements fuel ongoing growth, irrespective of economic conditions.
Of course, none of our results would be possible without the support of our customers, our partners, and the Drupal and Mautic communities. Last but not least, I'm grateful for the dedication and hard work of all Acquians who made 2023 another exceptional year.