5 Insights From Adobe’s CEO About The Digital Economy

by Digital Europe

Posted on 10-10-2018

Three uni­ver­sal themes unite mod­ern brands: Dig­i­tal is imper­a­tive, trans­for­ma­tion is here, and there is clear need for insight on every aspect of cus­tomer engagement.

This was among the many insights about the dig­i­tal econ­o­my offered up dur­ing a fire­side chat between Magen­to CEO Mark Lavelle and Adobe CEO Shan­tanu Narayen on the open­ing day of Magen­to Live in Barcelona.

Adobe (CMO.com’s par­ent com­pa­ny) com­plet­ed its acqui­si­tion of Magen­to in June, attract­ed by the platform’s mix of dig­i­tal com­merce, order man­age­ment, and pre­dic­tive intelligence.

Lavelle asked Narayen for his take on every­thing from acqui­si­tions to the world­wide dig­i­tal econ­o­my. Here are our top five learn­ings from their conversation.

The Mis­sion To Mas­ter Con­tent Continues

Unsur­pris­ing­ly, con­tent and its place in the dig­i­tal econ­o­my was a key ele­ment of the con­ver­sa­tion. Hark­ing back to an ear­ly piece of mes­sag­ing, Narayen said Adobe pro­claimed it sought to “make con­tent” because that’s the her­itage of the com­pa­ny; “mea­sure con­tent” because the com­pa­ny knew it would be impor­tant; “man­age con­tent” across all media and chan­nels to ensure a con­sis­tent expe­ri­ence; “mobilise con­tent” because of the sheer amount cre­at­ed and viewed on mobile; and “mon­e­tise content”–for obvi­ous reasons.

It was the last of the “five m’s” that posed the great­est chal­lenge in find­ing a com­merce plat­form to acquire, Narayen said. “We want­ed some­one who works with B2B as well as B2C. They need­ed to have the spec­trum of deal­ing with SMBs, mid­mar­ket, and enter­pris­es,” he said.

In today’s econ­o­my, he added, a plat­form needs to excel in deal­ing with phys­i­cal goods and expe­ri­ence goods.

The Evo­lu­tion Of SaaS

Con­tin­u­ing on the theme of mon­eti­sa­tion, Lavelle was keen to get Narayen’s take on the evo­lu­tion of soft­ware-as-a-ser­vice (SAAS) and its direction.

“The first gen­er­a­tion of SaaS involved every­thing mov­ing from on-site to the cloud and because it was eas­i­er to deploy and man­age, but there are still silos that exist in the cloud right now that are not talk­ing to each oth­er,” Adobe’s CEO reflected.

His solu­tion? A new gen­er­a­tion of enter­prise soft­ware focused on help­ing the var­i­ous clouds inter­re­late and work with each oth­er, though he was keen to empha­sise that despite the evo­lu­tion, the same basic mod­el was like­ly to prevail.

“If you take a step back and think about the Web, the two busi­ness mod­els that exist are trans­ac­tion-based busi­ness models–in which you pay per trans­ac­tion or by subscription–or there’s adver­tis­ing,” he said. “I think those fun­da­men­tal blocks of the busi­ness mod­el will continue.”

Data Is More Impor­tant Than Ever

When asked about his vision for util­is­ing data, Narayen said, “We want to help com­pa­nies be able to put their data as an asset on their bal­ance sheets.”

He described his company’s mis­sion to help brands use the inter­ac­tions they have with their cus­tomers to under­stand their demo­graph­ics, behav­iours, and engage­ment his­to­ry, cre­at­ing a pow­er­ful mar­ket­ing tool in the process.

To illus­trate the pow­er of data assets, Narayen used the exam­ple of a meet­ing he had had ear­li­er in the day at Magen­to Live.

“I met with a major sports com­pa­ny that has over 300 mil­lion sports fans,” he said. “So how can we har­ness the pow­er of that 300-mil­lion strong community?”

Open Source Dri­ves Innovation

Describ­ing the fundrais­ing process dur­ing his Magento’s ascent, Lavelle described the task of com­mu­ni­cat­ing the val­ue of the company’s open source com­mu­ni­ty to finance peo­ple who are focus­ing on the company’s “total address­able mar­ket” (TAM).

Elab­o­rat­ing on the breadth of ser­vice offer­ings that open source had facil­i­tat­ed in the com­pa­ny, he reflect­ed: “It wasn’t because we were any smarter; it was because of the ecosystem.”

Narayen used Adobe’s pur­chase of open source-based con­tent man­age­ment com­pa­ny Day Soft­ware in 2010 as an exam­ple of the company’s belief in the pow­er of col­lab­o­ra­tive com­mu­ni­ties. He referred to the deal as “one the most suc­cess­ful acqui­si­tions we’ve made.”

The Future Looks Bright

In clos­ing, Narayen posit­ed that although the future can be unpre­dictable, invest­ing in com­pa­nies designed to adapt will always be a suc­cess­ful strategy.

“If you look at the his­to­ry of Adobe, we’ve always believed it’s impos­si­ble to pre­dict where inno­va­tion will come from. The most suc­cess­ful com­pa­nies have invest­ed in plat­forms that allow an ecosys­tem to grow on top of them,” he said.

Com­ment­ing on the two com­pa­nies’ union, Narayen added: “If [togeth­er] we can pro­vide tools to prac­ti­tion­ers and C‑level exec­u­tives alike to cre­ate the cam­paigns, the engage­ment or the pro­mo­tions that they want with their cus­tomers, then I think we’ll be doing what’s expect­ed of us.”

Topics: Digital Transformation, UK, UK Exclusive, Digital EMEA