How Oracle Destroyed Multibillion-Dollar Bet on Advertising, Marketing Tech

  • Oracle spent over $4 billion creating an ad and marketing products giant, but failed to meet its goals.
  • It struggled against rivals like Salesforce and Adobe, then laid off scores of people in August.
  • Former employees say leadership was out of touch and product innovation stagnated.

In 2014, Oracle gathered marketers at New York’s Museum of Arts and Design to unveil a suite of products for them. Marketing products were a “big business” for Oracle, then-CEO Mark Hurd told those assembled.

“From a cloud-revenue perspective, this is hundreds of millions of dollars for us,” he said. “This is a material, core vertical, and it’s a material part in terms of where we think profit will grow.”

The cloud giant would spend over $4 billion over six years to acquire leading marketing and adtech startups like BlueKai, Datalogix, and Moat to build Oracle Marketing Cloud and about a year later, Oracle Data Cloud, which would later become Oracle Advertising. The idea was to combine them to help marketers make sense of all the data they had on customers and build relationships with them through consistent and relevant messaging. The company’s fellow enterprise giants Salesforce and Adobe were also racing to build products to sell marketers.

In theory, the new Oracle Data Cloud business would also sync with other Oracle services like tech for sales or human-resources departments — enticing clients to buy more Oracle technology, which would become a fixture across every facet of their business. 

Oracle struggled to realize its lofty goals. Marketing Cloud, once an expansive suite of products, has been reduced to a business-to-business platform for managing sales leads. This summer, Oracle cut Oracle Advertising and Marketing Cloud employees in a massive reorganization.

Multiple former employees said under Rob Tarkoff, the Oracle executive vice president who was appointed to lead the two businesses, the company failed to invest in Marketing Cloud, which caused Oracle to lose ground to Salesforce’s competing product. Oracle Advertising suffered from a lack of investment too, sources said. Employees also said they were demoralized by leadership that dismissed their concerns.

These former employees are known to Insider but requested anonymity because they feared reprisals.

A Facebook body blow

People close to Oracle Advertising traced the origin of its decline to 2018, when Facebook banned companies like Oracle’s data unit from selling its audience information after revelations that Cambridge Analytica misused Facebook user data. It was a major blow to the unit’s revenue.

Oracle Advertising tried to recover by building products that would help advertisers adapt to the planned phaseout of the ad-targeting cookie, which had long been the backbone of digital ads.

But clients weren’t clamoring to solve a cookie problem that wasn’t immediate. Instead, they were asking for products that competitors had but Oracle didn’t.

“So if we were out on one product, we’re missing the boat,” a former employee said. 

These missteps cost Oracle customers. Moat, for instance, was once a leading company in ensuring online ads were seen by real people. But it recently lost Unilever and Nestlé as clients, sources said. Unilever and Nestlé did not respond to a request for comment. 

The grand plan to integrate the marketing and advertising products into one giant platform also hit snags as Tarkoff and his team struggled to integrate them technologically, multiple sources said.

One former employee said that while Tarkoff was “hyperfocused” on the corporate mandate of merging everything into a single platform, called Fusion, he didn’t understand how Oracle Advertising would fit in. With the company-wide summer reorg, Tarkoff still handles the sales strategy for Oracle Advertising but Oracle Chief Corporate Architect Ed Screven has taken over the tech development, which some insiders saw as another sign of Oracle’s difficulty with the integration.

Oracle Advertising had been run by the well-liked Eric Roza, but he left in 2019, and the new leadership came across as uninformed to some. The idea that Oracle could disintermediate advertising by replacing marketers’ long-standing relationships with their ad agencies seemed unrealistic. There were also moments when leaders seemed out of touch.

For example, at an all-hands meeting in 2020, Stevan Vlaović, the newly hired engineering lead, repeatedly dismissed employees’ concerns about a lack of salary increases as “hyperbole.” Later in the same meeting, he and other execs started talking about their car collections. (One attendee recalled that Vlaović said he had seven, and that Derek Wise, who led the product team, shared he’d recently purchased an Aston Martin.)

‘Maybe we’ll just admit that Salesforce has won’

While Oracle’s products stagnated, its competitors weren’t sitting still.

Salesforce offered huge discounts to customers that Oracle couldn’t match, two sources said. Salesforce did not respond to Insider’s request for comment.

Salesforce’s marketing and commerce cloud grew 25% to $3.9 billion in revenue in its 2022 fiscal year — well ahead of Oracle’s Marketing Cloud business, which around that time generated far less than $2 billion, one source with knowledge of its business said. Another person with knowledge of Oracle’s business said that Oracle Advertising made $2 billion in revenue, but that the unit was only growing at a rate of 2% and was losing share to rivals as of late last year.

“It was a failing business,” this person said. “If you were going to cut and save money, you’d cut from the [Advertising] team, because that business is not interesting for Oracle.”

Oracle declined to comment on revenue numbers.

Meanwhile, Oracle also lagged Salesforce and Adobe in promoting its marketing tech products, a third former employee said.

“God forbid you had a contentious renewal, or you were competing with Salesforce or Braze or anybody, because you were going to lose,” this source said. “There hadn’t been any product innovation or development inside the core moneymaking products for a very long time.”

The summer layoffs came to another former employee as the final blow to Oracle’s marketing and advertising ambitions. 

“It’s definitely very bare bones at this point,” this person said. “Maybe we’ll just admit that Salesforce has won.”

Do you work at Oracle or have insight to share? Contact Ryan Joe via Signal at (310) 880-8992, email ([email protected]) or Twitter DM (@threefirstnames); Belle Lin via encrypted email ([email protected]) or corporate email ([email protected]); or Lucia Moses via Signal (917) 209-8549, email ([email protected]) or Twitter DM (@lmoses).