It was a big week for the customer experience market, with two major players in the marketing tool space taking swings to bring the idea to the next level. The pair of moves taken together could move customer experience closer to reality after a long period of ambition.
“Customer experience” is kind of a vague notion. The idea is that you want your customers to feel good every time they interact with you, whether in person or online. You certainly know when that doesn’t work well, but it can be more subtle than simply a big smile in person or a successful outcome online. It’s more about taking the extra step to get ahead of problems before they happen or designing a product in an elegant way to reduce friction.
It seems that with all the data we have about customers these days, companies should be doing better at generating positive experiences. In fact, there is so much data from so many sources that companies like Adobe and Salesforce have created customer data platforms (or CDPs for short) to pull all of that data into one place with the goal of delivering optimal customer experiences based on the knowledge you have collected about customers.
Two of the biggest companies involved in gathering and using this data are Salesforce and Adobe. While Adobe doesn’t have a CRM, it certainly has marketing tools, and its $20 billion purchase of Figma was all about designing great products, which ultimately should lead to a better customer experience.
At the same time, at Dreamforce this week, Salesforce’s annual customer conference in San Francisco, the CRM giant announced a new approach to data integration on a platform called Genie. While it works in conjunction with the platform of tools itself, and with external partners like Snowflake and Amazon, the ultimate goal is to use the massive amounts of customer data to generate the best customer experiences possible at the moment they’re needed.
It feels like everybody goes through a quick “graphic design is my passion” phase once in their life, and then quickly gives up after one failed abstract macaroni painting. But everyone practices design in their lives in some way, however. Whether that’s by touching up selfies, making memes or making slideshows for a work presentation, we make decisions on design every day.
Thankfully, software company Adobe has recognised this and the importance that everyone deserves access to design software and the ability to learn how to use them. This becomes more vital as employers are starting to prioritise candidates with design experience.
To help every aspirational hobbyist, including students and small business owners, Adobe has been aiding in the democratising of great design through Adobe Express, an all-in-one free content creation tool. The web and mobile-based app, which launched in December of last year and has continued to evolve and meet the needs of creators by releasing new and exciting features and updates. These changes have helped hopeful creators get started on their design passion and given them the tools to start quickly creating standout content in no time.
The software is free to sign up for so you can start your journey in content creation with no strings attached. There is also an additional Adobe Express Premium offering, for $14.29 a month if you find yourself wanting to access more tools and creative cloud integration.
In Adobe Express Premium, you’ll receive access to further tools such as Photoshop and Premiere Express. These can be great if you’re looking to start a personal video diary or want to Improve on your TikTok game. With Adobe Express you’ll be able to edit your videos on the fly to cut together a quick recap of your day to send to loved ones, edit out annoying objects in your photos or videos, or fix any issues with lighting to match your godly whims.
Not only has Adobe Express simplified the design learning process, but it’s also simplifying Adobe’s collection of creative tools. Bringing together Adobe Stock images, a wide array of templates, content scheduling and quick actions powered by Photoshop, you’ll have a wide variety of tools at your disposal. You’ll also gain access to a large selection of fonts from Adobe’s library.
This service aims to highlight its flexibility for any user’s design needs. Whether you’re removing a background, adding colour to your text, or placing your logo on a product image. In just a few taps, you can resize content for your socials and create easy, high-quality graphic designs.
There are plenty of great on-the-go features as well, such as the ability to edit, export in JPG or PNG or resize or convert or export to PDF as well. This app can be your swiss army knife as a designer if you’re ever caught off guard and need to make a quick edit on your phone.
If you’re a small business owner, you’ll be able to quickly add your logo to any photo, or design your business identity yourself. You’ll also want to take advantage of Adobe Sensei, which will help quickly edit your videos for Insta, and streamline business processes by turning notes into shareable PDFs in seconds.
Adobe is also extending its services to schools through the Adobe Education Exchange, which provides free tutorials, courses, lesson plans and videos to students. The hope for this program is that it will help students develop stronger creative skills while giving students and teachers direct access to resources that can help them.
A key issue in software comes down to accessibility. Thankfully Adobe Express works on all platforms and browsers, so you’ll won’t be locked out of any features based on your hardware of choice. Adobe is deeply committed to supporting Adobe Express and its community for many years to come and will be providing frequent updates to the platform and responding to feedback.
To learn more about Adobe Express and Adobe’s collection of creative tools, tune in to Adobe MAX, streaming October 20 across the Asia Pacific. Register to the free event here.
If you’re looking to take another stab at that graphic design passion, try signing up for Adobe Express for free here.
You likely have not opened a file on your computer in the last decade without seeing Adobe’s name. They are the giant tech company that specializes in the creative software space. It’s estimated that over 90% of the world’s creative professionals use Photoshop for business. The company is known for Photoshop and the PDF file format, but there is so much more to Adobe for creatives and those who manage them and sell creative services. We’re going to look at how Adobe makes money, and what’s behind the accurate downward movement of Adobe stock.
Having recently issued its earnings report on September 15 for the third quarter of 2022, the Adobe reported a net income of $1.14 billion on a revenue of $4.43 billion for the period. However, the announcement of the Figma acquisition has caused the stock to plummet as Wall Street isn’t pleased with the move. What’s behind this Figma purchase, and how does this impact the future of Adobe?
It’s estimated that more than 400 billion PDFs were viewed with Adobe products in the last year, and we can’t ignore how popular the company has become. Annual revenue was $15.785 billion for 2021, a 22.67% increase from 2020. For the third quarter of 2022, Adobe reported a record-setting revenue figure of $4.43 billion, marking 13% year-over-year growth.
There are three revenue streams when you look over Adobe’s earnings report:
Adobe breaks the revenue down into two operating segments: Digital Media and Digital Experience. Digital Media revenue was $3.23 billion for the quarter, and Digital Experience revenue reached $1.12 billion.
Digital Media consists of the popular Creative Cloud and Document Cloud services. Document Cloud includes Adobe Acrobat and Adobe Sign services. Creative Cloud contains popular applications like Photoshop, Illustrator and Premiere Pro to name a few.
The Digital Experience segment includes Experience Cloud, which is the tool that companies use for marketing commerce purposes. Regular customers don’t commonly know this product as it’s designed for enterprise use. The Experience Cloud platform uses data, software and analytics tools that allow businesses to track the buyer’s journey. The products here include:
The company also offers email and further analytics options under this segment.
A quick glance through the Adobe website shows all of the products offered under Adobe Creative Cloud, Adobe Document Cloud and Adobe Experience Cloud.
Despite announcing record-breaking revenue for the quarter, Adobe has lost big in the stock market over the last two weeks. The brand has been raked into the mud due to confusion among analysts, and their stock price has dropped accordingly.
Wall Street doesn’t like this move as the $20 billion figure roughly equates to 50 times Figma’s expected revenue (annual recurring revenue) for this year. As a result of this announcement, the stock has dropped significantly.
Adobe announced the acquisition of Figma on September 15, and the Adobe stock dropped 24% by the next day as the announcement was met with disappointment. The initial news crashed the Adobe stock immediately by about 17%, which erased about $29 billion of its market cap. This was the worst single-day drop for Adobe since September of 2010. This one move erased $9 billion more from the market cap than the real purchase price of Figma.
Many analysts have been coming forward with slashes to the price target for Adobe since the acquisition announcement, which has added to the stock’s decline. We’re going to dig a little deeper into Adobe’s logic behind this move.
The stock just started creeping over the last two days, September 27 and 28.
During the last earnings report on September 15, Adobe dropped the news that they were purchasing Figma for $20 billion, plus an additional $2 billion for management retention as the CEO stays on. The hefty $20 billion price will be paid for with cash, stocks and possibly a term loan.
The proposed acquisition should go through in 2023, pending regulatory approvals. Figma was founded in 2012 and sells a design application tool that’s used for creating websites, apps and logos.
Many analysts quickly pointed out that the price tag for Figma just doesn’t make sense. Figma was valued at $10 billion in June of 2021, so this is a sizable jump in valuation. The consensus was this was a defensive move; Adobe was panic about a competitor gaining further market share, so they had to negotiate from a weak position. Many felt that Adobe was losing too much momentum to Figma, so the move to desperately buy them out instead of attempting to compete with them was at least strategic, if questionable.
This leaves many investors speculating if other competitors like Canva or Sketch could catch up to Adobe as the popularity of cloud-based graphic design tools grows worldwide.
Other analysts brought up that Adobe let a competitor grow so quickly that they had no choice but to pay a premium to buy them out, an immediate red flag that research and development is out of touch with customers and the broader marketplace.
As Adobe transitioned to cloud-based software, it was clear that Figma was gaining market share with its collaborative design tools. Many users felt that Figma’s cloud-based design software was not only cheaper but easier to use and more collaborative than Adobe’s products. Figma’s software is currently used by large companies like Airbnb, Google and Netflix to design their websites.
On the flip side, Adobe is removing a huge competitor with this move, and they also buy a fast-scaling business. The company’s also staying on the cutting edge by purchasing this successful company instead of investing time and resources to spin something up internally. Adding Figma to the company will increase revenue.
Revenue at Figma has been growing 100% annually, and the gross margin is at 90%. These two key figures could be enough to justify the acquisition as Adobe already has a strong global sales force that could benefit from this added revenue stream.
The digital design sector has exploded, and will continue to grow for some time, especially atop the substrate that is cloud software. Many users turned to Canva since the tool allowed cloud-based collaboration for creatives, and it was much easier to use than more advanced applications like Photoshop and Illustrator. As cloud applications become more popular and easier to scale, the competitive landscape will remain strong.
With Adobe’s stock dropping on the news of the acquisition, some analysts feel that this would be the perfect time to buy, while other analysts continue to downgrade Adobe stock. It’s difficult to predict how the acquisition will go through, but there’s certainly potential for Adobe to significantly increase its revenues with this added synergy, on top of its already impressive growth of late.
We will continue to monitor this tech giant as they follow up on this move. It’s still a bit too early to decide what the purchase will mean for revenue and growth moving forward.
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Believe it or not, Dylan Field tells me over Zoom this week, when he started Figma he was only thinking about one thing: making cool design tools. In was 2012, and Field and co-founder Evan Wallace had the idea of building design software for the web browser — making the design process live, interactive, and collaborative — in ways it hadn’t really been in software before.
The idea was much easier to imagine than it was to build. Figma was building in stealth mode for three years before its first public preview, but the hard technical work paid off. Figma was a hit with designers almost immediately, as the real-time collaboration it enabled made design processes — particularly software design processes — much more efficient than they had before.
The company’s user base grew accordingly, and by this year Figma was out-competing design giant Adobe among design teams at Microsoft and other companies. And so it was not particularly surprising when Adobe said this month that it intends to acquire Figma, keeping it as an autonomous unit within the company, with Field remaining as CEO.
Investors have been skeptical about the deal
What was more surprising, perhaps, was the $20 billion Adobe offered: 40 times Figma’s current annual revenue run rate, and one of the largest startup acquisitions ever. Investors have been skeptical about the deal; Adobe’s stock price is down sharply since the acquisition was announced, whether due to sticker shock or fears that Lina Khan’s Federal Trade Commission will block the deal on the theory that it’s anticompetitive. (She has sued to block much smaller and arguably less consequential deals than this one.)
I last wrote about Figma here in April 2021, as the company introduced its FigJam virtual whiteboard and Field navigated his team into a hybrid in-person and remote workplace. When news of the acquisition hit, I wondered how Field planned to navigate everything that’s now in front of him: antitrust issues, keeping control of his product road map, and whatever DALL-E and other AI tools might mean for the future of design.
Highlights of our conversation follow; this interview has been edited for clarity and length.
Casey Newton: Are you tired of talking about this acquisition yet?
Dylan Field: I’m just tired in general (laughs).
So any time a beloved tool gets bought, users worry that this could be the beginning of the end, or at least of a slow decline. What’s your case that Figma can keep innovating inside a bigger company?
First of all, autonomy. Second of all, I’m not going anywhere. Figmates are stuck with me.
And I’m really excited about what’s ahead — I think this is our opportunity to like press the gas even more. We’re currently playing in the product development world; we’re pretty excited about what we can do to accelerate on productivity use cases.
People are really wanting more creative assets: So like, for example, 3D video, imaging, vector illustration. These are all things that people are requesting in the context of product design. And the ability to then take those and go into creative use cases too, and build creative tools that are web-first, browser-first, collaborative — I’m pretty excited about that. And so I feel like this will be an unlock for us. And make it so that not only can we do what we wanna do faster, but do more of it as well.
I still think of Figma as mostly a product design tool; I haven’t thought about it as much of a productivity tool. What do you hope to do there? And what do you hope is the ultimate outcome for Figma inside Adobe?
I put it in the blog post for the acquisition announcement, but the original vision statement for Figma was to eliminate the gap between imagination and reality. We’ve talked about that before. You were like, “a little corny, Dylan!”
[I don’t remember saying this but can’t deny it sounds like something I would say — Ed.]
I think it’s kind of returned to that — a return to this idea of, how do you take stuff inside of your brain, and get it on the screen, and do that across a variety of mediums?
“Creativity and productivity are starting to merge more. I think this is a general trend.”
On the productivity side, there’s a lot that’s going to be possible there. Creativity and productivity are starting to merge more. I think this is a general trend: a lot of tools are becoming easier to use, and more people have access to them. That’s a good thing. So it’s natural for people to want to make their presentations, their white boarding, and their documents better designed. And also have all sorts of creative assets. How do we make it so they’re able to do that? And let them make stuff and do things that normally would take 12 hours in two minutes?
In fairness to me, I don’t think I would have called your mission statement corny had I used DALL-E before then. But now I live in this world where I just type what I want the illustration for my newsletter to be, and then I have it within seconds.
This stuff has been on my mind, though, because you can now just sort of speak design into existence in a way that you weren’t able to before. How are you thinking about AI in what you’re doing?
I think that we’ll have to figure it out, and what that means for our platform.
I think there’s just a ton of possibility here — it feels like kind of the early 90s of the internet in a way that I think is very exciting. And I also put this in the blog post: I feel a deep sense of responsibility to figure out the best way for creatives to utilize this productively. And for it to be a collaboration between AI and humans versus… something else.
And I think that this can supercharge creativity. It can really help people express themselves. But it’s going to be a lot of change. And I think that it’ll be not just in creative tools, not just in design tools or productivity tools — it’ll be everywhere. All of software. I think that it this is going to be a really interesting and exciting next five years.
Shifting gears: Lately we’ve seen the FTC express a great deal of skepticism about big acquisitions, arguing that they reduce competition and could lead to price increases or other harms for consumers. What’s your case this is good for the market?
First of all, we’re gonna give our users a ton more functionality, and I think that it’ll be really good for our customers. There’s not a price increase here — we’re doing everything we can to keep prices the same, even in an inflationary environment.
And, we’re keeping it free for education. That’s been a critical thing that we’ve talked about with Adobe, and they’ve been all in on.
I think this is really good for ecosystem, honestly. We’ll show that over time. We’ll have to make sure that we we show our customers and the community that we’re gonna continue to not just innovate, but innovate quickly, and pick up the pace and do more than we have done in the past, And that’s a challenge, but it’s one I’m down to sign up for.
Finally, have there been any stories about the acquisition that outraged you, that you would like to answer once and for all right now?
(Laughs) You know, I think the amount of misinformation over anything that becomes an event is high. I already knew that you should probably shouldn’t believe everything you read online. But being part of an event like this definitely reinforced that for me. It’s been interesting to have that correction.
In an interview with Bloomberg, Adobe Chief Product Officer Scott Belsky has reassured panic Figma users that the online collaborative design platform's acquisition will not change its pricing model and ease of use. If you'll recall, Adobe announced in mid-September that it's purchasing Figma for roughly $20 billion in cash and shares. Users understandably raised concerns about the merger, seeing as Adobe's programs are quite expensive.
Belsky said in the interview that Figma will remain a "freemium" offering with a basic tier that's available at no cost. Figma co-founder Dylan Field added that Adobe isn't planning any price increase and that the platform will remain free for education. Adobe does have changes planned for the platform, of course, including integrating features from its software portfolio, as well as its library of fonts and stock images.
According to Belsky, though, any update Adobe rolls out won't be obstructive and won't make it difficult to navigate the platform's interface. Perhaps most importantly for those who use Figma for collaborations, it will continue allowing file sharing without additional fees — users won't have to get a Creative Cloud subscription to work on the same document.
Adobe's suite of programs will undergo changes due to the acquisition, as well. The company plans to adopt Figma's collaborative features and may build multi-user web platforms for its programs. Adobe Express and Acrobat might also get their own versions of Figma's whiteboard and presentation functions. "We would only want to amplify and continue and learn from the things that Figma has done to become a viral product in the enterprise and throughout the world," Belsky said.
There is one Adobe program that might not survive the acquisition: Figma's direct competitor Adobe XD. The company has no immediate plans to kill the software, but it will "reevaluate where [it] want[s] to shift [its] resources and focus" once Figma comes in. Both parties expect the deal to close sometime in 2023, so long as it gets approval from both regulators and shareholders.
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We’ve found some amazing wallet-friendly deals on the Adobe Creative Cloud plans on Amazon UK of more than 30% off. The Photography plan, which includes Adobe Photoshop, Lightroom, Lightroom Classic, and Lightroom Mobile, is now available at a 38% discount! This offer comes as part of Amazon Prime Day Early Access sales, which run from October 11 to midnight October 12.
While Adobe is renowned for its quality software, but its pricing, even taking into account student discount, is not easy on the eyes. That is, usually. Adobe’s aptly named the Photography plan with this discount, however, is certainly eye-catching. The one-year plan not only grants access to the aforementioned software but includes 20GB of cloud storage and is currently a best-seller on Amazon.
Speaking of students, Adobe’s Creative Cloud Plan for students and teachers, which includes all Adobe software, also has a Prime Day discount. Additionally, Adobe Lightroom with 1TB of cloud storage has a massive discount. It is worth noting that its price has already been discounted by Amazon and is going down further for Prime users.
These are just some of the deals available from today until midnight October 12 but don’t forget to do your own searches on Amazon Prime if you’re looking for deals on specific products. Good luck!
*Disclaimer, we earn affiliate revenue on these links, but it doesn’t cost you anything extra to use these links.
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Adobe is launching a marketing mix modeling service that uses artificial intelligence to assess return on investment in weeks rather than the months it typically takes for such analytics.
The upshot is that marketers can use the tool, which will be generally available as part of the Adobe Experience Cloud, to adjust media and marketing plans on the fly, or at least within a month or quarter, rather than taking a retrospective look at what happened in the past to adjust future spending.
The tool, powered by Adobe’s Sensei AI engine, also appears practical for smaller and mid-size marketers that don’t have teams of data scientists on staff and often can’t afford the price tag for an outside marketing mix modeling project. One early pilot user was AAA Northeast.
Adobe’s move comes as marketing mix modeling (MMM) enjoys a renaissance after years of losing ground to multi-touch attribution (MTA). Making the AI tool available across an already huge base of Adobe could fuel the growth of MMM further.
Attribution has taken a hit because it relies heavily on tracking the online behavior and purchases of individuals, which has grown more challenging amid the dwindling availability of cookies and digital identifiers and will become even harder once Google follows through on plans to eliminate third-party cookies from its Chrome browser. Google has delayed the move multiple times, with plans to now eliminate cookies by the end of 2024.
MMM uses modeling based on a variety of data streams but doesn’t require individual identifiers. And the approach long has focused on offline media—where it had its roots—in addition to digital. But it also generally has been costly and time-consuming, requiring six- or seven-figure price tags and months or work.
An early pilot user of Adobe’s “AI as a service” approach is AAA Northeast, which used it in March to deliver a 28% increase in lead generation for its auto insurance business while reducing advertising spending 16% for the month.
“Our tech stack is primarily Adobe,” said Lisa Melton, senior VP of marketing at AAA Northeast. “And so when they came to us and asked if we wanted to be part of the pilot, we were like, absolutely. It’s every marketer’s goal to make sure your dollars are going where they have the biggest return.”
The AAA Northeast insurance business that was in the pilot uses digital display, search, connected TV, linear TV and a small amount of postcard direct mail, Melton said. Adobe’s AI MMM analysis led her to shift money out of linear TV into display and search.
Melton hopes to continue to testing the AI MMM tool on other lines of business, perhaps including membership acquisition, which has more direct mail in the mix. And she’s now incorporating the Adobe Experience Cloud into her tech stack.
Adobe previously had an AI attribution tool, but in conversations with marketers found that they wanted ROI analytics solutions that cover other media that attribution can’t, including offline cookieless media and social media walled gardens, said Monica Lay, principal product marketing manager for digital experience at Adobe.
Marketing mix modeling can analyze results from those media, but historically took six to 12 months to set up initially and three months to deliver reports on an ongoing basis after that, Lay said. That doesn’t help marketers who want to know how to spend incremental dollars—or cut budgets—within a current budget cycle, she said.
“We’re noticing in customer conversations pressure on senior leadership to deliver more for less,” she said. “We’re seeing budget cuts across marketing spend, but there’s still pressure to deliver the same revenue targets.”
Liz Miller, VP and principal analyst of Constellation Research, who’s tried the AI MMM tool, said she really likes it as “a way of accounting for all that data that can come in as a giant tsunami that no one can really manage. This starts to bring a new layer of what I refer to as decision velocity, which is about making not only good decisions, but making great decisions faster.”
Miller also believes the tool, as part of an Adobe service suite, could open marketing mix modeling to a much wider range of marketers who simply couldn’t afford it before. “Media mix modeling has been cost prohibitive for a lot of organizations,” she said.
Gerry Murray, research director for marketing and sales technologies at IDC, sees Adobe’s move as “an inflection point” for intuitiveness and simplifying how marketers can use models that drive decision-making.
“I think it’s a bit of a dawning of a new day for marketers to have a more holistic ability to show how they drive the revenue and customer lifetime value metrics that the C suite is really interested in, not just the clicks and engagement metrics,” Murray said.
Adobe’s new tool likely will appeal to existing Adobe analytics users, but it’s not the only way to overcome the privacy restrictions hampering MTA or the speed and cost issues that long have hampered MMM, said Jeff Greenfield, a pioneer in MTA who now is CEO of Provalytics. His company takes an alternate approach, combining elements of attribution and marketing mix modeling to measure “incrementality,” or the incremental impact of changing spending across a variety of online and offline media.
AI, while it’s a hot buzzword in marketing, is probably a misnomer here, Greenfield said. Few if any systems in marketing analytics truly show signs of human cognition or original thinking that are hallmarks of AI, he said. “Machine learning” is likely a more accurate description, he said, of the series of algorithms that could go into automating a marketing mix modeling process.