ADOBE

Inc

Devesh Kumar

Prof G Brand Sprint Sep 2020

Table of Contents

• About Adobe Inc
• Brand Architecture
• Clock Model
• Brand Audit
• 3 Hurdle Analysis
• Brand Identity
• Recommendations

About

Adobe Inc

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Adobe’s Key Stats

• A global leader in digital media and digital marketing with its Creative, Marketing and Document solutions.
• Market Cap of $240 Billion
• Revenue Breakdown by Category:

Digital Media:

1. Creative Cloud: 60% of total
2. Document Cloud: 11.5% of total

Digital Experience:

1. Experience Cloud(Marketing): 26.5% of total

Other Sources : 2% of total

• Subscription Revenue accounts for 92% of Total Rev
• Explosive Growth since shifting to Subscription model

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Revenue By Category YTD 2020

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Recurring Revenue

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*Reference from Adobe’s Revenue Report 2020

Brand Architecture

Adobe

Creative Cloud

Experience Cloud

Analytics

Experience Manager

Audience Manager

Campaign

Advertising Cloud

Target

Primetime

Commerce Cloud

Marketo Engage

Magento commerce

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Acrobat

Acrobat DC

Acrobat Reader

Adobe Sign

Adobe Pdf

Adobe Pdf Export

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Photoshop

Illustrator

InDesign

Adobe XD

Lightroom

Acrobat Pro

Animate

Dreamweaver

Premiere Pro

Premiere Rush

After Effects

Dimension

Audition

InCopy

Lightroom Classic

Media Encoder

Character Animator

Prelude

Fuse

Bridge

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Document Cloud

Master Brand

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Sub Brand(Layer 1)

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Sub Brand(Layer 2)

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Clock Model

Paid media(video ads, direct buy, programmatic)

High Quality TV commercials

Social Media Marketing(Instagram)

Content Marketing (Blog/CMO.com/Behance)

Website browsing/ purchase experience

Software/product usage experience

Online Salesperson while purchasing

Case Studies on website

Customer service & Support forum

Community interaction on Behance

Software updates & Bug fixes

Tutorials and certifications

Brand Audit

Positives

Negatives

• Extremely Innovative in the creative space
• Ahead of the curve
• Covers every creative niche
• High quality products
• Intuitive Software
• Cinematic and high production quality advertisements
• Agile in discovering opportunities
• Industry leaders
• Strategic acquisitions
• Career Accelerant
• Employee satisfaction

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• Unfair Pricing practices
• Monopoly status
• Anti competitive
• Poor reception to subscription model
• Bad customer service
• Security issues

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3 Hurdle Analysis

Differentiation

What makes Adobe different?

Subscription Model (Rundle)

Adobe shifted to a subscription based Saas model in 2012, while offering it’s traditional software for purchase until 2017. Since then, Adobe has witnessed explosive growth in value.

Adobe currently offers subscription for individual flagship products like Photoshop, Acrobat, Lightroom and others, while also bundling similar products together:

• Creative cloud
• Document Cloud
• Experience Cloud

Market cap increased from $14 Bn in 2012 to $240 Bn in 2020 with a 1600% growth.

This has helped them acquire revenue in advance while improving user stickiness at the same time by forming monogamous relationships.

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*Reference from Yahoo Finance

Visually Appealing Ads & Celebrity Colaborations

Adobe is known for it’s visually appealing and creative ad campaigns and TV spots for its Creative cloud offering.

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Celebrity collaborations:

• Adobe collaborated with Zach Braff to make a short film based on an artwork created by a student for the Adobe #moviepostercontest.
• Adobe collaborated with Billie Eilish, asking students to create the artwork for her latest album, generating high social engagement.

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Product for every Creative niche

Adobe has 20+ software products covering every niche for it’s creative cloud offering. Since its introduction in 1989, Photoshop quickly became the industry leader and eventually the industry standard for image editing.

Over the years, Photoshop, Illustrator, Premier, InDesign, and After Effects were the company's most popular products, and beginning in 2003 were available as the Creative Suite bundle, and then eventually being offered in the Creative cloud Saas.

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Relevance

How relevant is Adobe to customers?

Strong Brand awareness & Seo

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*Reference from Google Trends and SimilarWeb

High Social Media engagement

Instagram

Youtube

Sustainability

How does Adobe own it?

Strategic Acquisitions

Adobe has acquired 51 firms since 1990, with 20 acquisitions in the last decade.

Adobe has been expanding to adjacent spaces with its latest move into digital marketing and analytics. Since the launch of its Experience cloud in 2012, Adobe has been strategically filling gaps by acquisitions for its digital experience business. Some notable acquisitions include:

• Behance for moving into the social media space for creatives and designers. It is also using Behance as a means for job postings.
• Dreamweaver for its creative suite
• Cmo.com was acquired as a means for B2B content marketing targeting higher executives.
• Experience cloud acquisitions include Magento for $1.68 Bn, Tubemogul for $0.5 Bn and Marketo for $4.75 Bn.

*Reference from Adobe’s Wikipedia page

Career Accelerant and Talent moat

• Adobe has consistently featured in the Fortune’s list of Best workplaces to work for and LinkedIn’s Top companies list.
• Glassdoor rating for Adobe is 4.2 out of 5
• As per the data on Linkedin, Adobe has 25k employees with 10% of the employees having moved to Big tech, showing that Adobe sends talent to the best firms.

*Reference from Glassdoor Reviews and Linkedin Insights

Brand Identity

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1. Brand Essence: Democratising Creativity

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Why? : Adobe has been a visionary firm, creating products that help people in bringing their imaginations and creativity to life. It has made technology accessible to the common people to remove the technology barrier between creators and their creativity.

B) Core Identity:

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• Innovative
• Trendsetter
• Cutting Edge Tech
• Colorful
• Holistic experience
• Artistic
• Visionary

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C) Extended Identity:

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1) Brand as a Symbol: The two letter mnemonic system to represent its products is the most recognisable component of Adobe.

2) Brand as a Person: Christopher Nolan, He is a perfect combination of being young/current and visionary at

the same time.

3) Brand as a Product: Photoshop: It has been revolutionary in image editing and continues to be a favorite among creators.

4) Brand as an Organisation:

• Accelerant
• Support & empowerment

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Recommendations

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Recommendations Overview

Pre Purchase: This section is already robust for Adobe as it has high organic volume and high production quality advertisements. However, the existing Quality Cue and Laddering options can be elevated. Also, the Thermometer model can be revamped to make communications more regional and customised.

Purchase: There has been some customer outrage due to Subscription options of Creative Cloud and associated pricing. This outrage has primarily come from hobbyists rather than expert editors. This will be tackled by introducing better bundling and lower priced and “essential” versions of existing rundles.

Post Purchase: This section needs significant investment as there have been security concerns as well as reports of poor customer service. This will be tackled by partnering with an encryption firm to better protect the Creative and Document Cloud’s personal data. Customer service will be improved by making significant investments in the support team as well as incorporating the Behance social platform of Adobe to make the service more “human”.

Horizontal Expansion: There is a new market expansion opportunity for Adobe by venturing into Game Development Tools and Cloud Gaming.

Phase 1 : Dial down the Negatives

Phase 2: Elevate the Positives

Recommendations by Timeline

• Subscription Model Optimisation
• Security Improvement
• Customer Service Improvement

• Quality Cue and Laddering elevation
• Revamping the Thermometer Model
• New market expansion into Gaming

Pre-Purchase Phase

(Recommendations)

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Quality Cues & Laddering

Adobe’s Quality Cue is undoubtedly its massive investment in its Creative part of the business by covering each and every niche. Adobe currently offers 20+ software products for its Creative Cloud, which covers everything from image editing, logo designing to video editing and much more. No other competitor boasts such a formidable roster of creative solutions. This Quality Cue can be used as a Laddering technique:

• Differentiated: No other alternative currently provides such a holistic creative solution
• Relevant: It is very relevant to the target market as editors and designers have to use multiple types of software solutions for their projects
• Sustainable: Adobe has proved this to be sustainable by being the industry leader over the past 3 decades by creating moats around it. Adobe has quite a deep penetration in the creative world resulting in a high switching costs barrier if the consumer decides to switch to a different brand. Also, it benefits from network effects as designers become well versed with Adobe from the start of their education and career, giving corporations incentive to deploy Adobe products.

Adobe should utilise its Quality Cue as a Laddering technique to fend off competition and maintain its position as the industry leader. Adobe already has invested immensely in its quality of pre-purchase. They can use this as a medium to showcase their creative cloud business through an ad campaign while subtly indicating that no other alternative offers such a holistic solution.

Thermometer Model

Adobe’s current Thermometer Model is quite rigid with all of its attributes: Name, Logo, Product, Distribution, Price and Communications are all below the freezing point. Adobe utilises it’s high brand equity and universal appeal to its advantage. However, with the ever increasing competition, it makes sense to make Communications flexible while keeping the other elements static.

Strategy:

1. Adobe can use its high brand awareness to keep the name and logo static. The products serve the same purpose worldwide, so that can be static too. In addition, the distribution channel(website) can benefit from economies of scale by keeping the templates the same.
2. Communications can be made flexible by utilising regional social media handles on Instagram and regional ad campaigns to customise messaging.

Purchase Phase

(Recommendations)

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Subscription Model Optimisation

The existing Subscription model offers the Creative Cloud subscription at $52.99 per month and only Photoshop at $20.99 per month. This comes across as expensive for the casual photo editing enthusiast. In order to not lose market share to lower priced alternative products, Adobe can introduce “Essential” versions of each of its creative product containing only the most necessary and lighter features. These can be bundled together in a Subscription “Rundle” to create an attractive offering for the targeted segment. This can be called the Adobe Creative Essentials Cloud.

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Example: Salesforce offers 2 subscription versions for its Cloud Subscription : Salesforce Essentials and Salesforce Professional. These are both priced at $25 and $75 per month respectively.

Post-Purchase Phase

(Recommendations)

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Security Improvement

Adobe has suffered major Security Breaches in the past. One of the most notable ones is the 2013 data breach of Adobe document and Creative suite which resulted in exposing 38 million users’ sensitive data. The other one occured in 2019 putting another 7.5 million people at risk.

Adobe had responded by providing free credit monitoring services to its US users. However, this is not enough. Adobe needs to take a leaf out of Zoom’s recent crisis management strategy and show an intent of overcorrection.

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In order to minimise such incidents, Adobe needs to have a sustainable strategy and carve out a detailed plan of action:

1. Adobe needs to be transparent to its customers with this process and instill confidence within its users. The company spokesperson needs to Address and Acknowledge this issue to let people know that they are taking active steps to minimise such incidents
2. Adobe needs to partner with a data protection company like Okta to strengthen it’s Cloud Encryption capabilities. Security should be a mandatory feature among all of its products.
3. Adobe needs to communicate these updates to its users through its official blog and social channels.

Customer Service Improvement

Adobe has generally negative reviews when it comes to B2C customer service. Common complaints include incompetent support people and ignorance of customer grievances. Adobe needs to take some concrete steps to improve the post purchase experience for its customers to increase user stickiness especially since it’s now monthly subscription based which gives users the option to opt out of Adobe immediately.

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1. Significant investment needs to be made in training the customer support team to handle each and every kind of issue. A “customer first” approach needs to be taken to improve the word of mouth.
2. Adobe needs to utilise its Social Media platform Behance. A unique social media approach can be taken to resolve the customer grievances by making customer support chat options available within the social platform. This approach will make the customer support more “human”.

New Market Expansion

(Recommendations)

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Game Development = Adobe Gaming Cloud

Gaming has witnessed huge growth over the recent years. It is currently a $93 Bn market. Adobe can capitalise on its Creative design capabilities and venture into providing a Game Development Kit for game developers.

Strategy:

1. In order to get a jump start, Adobe can acquire the game developer Unity Technologies to get access to their gaming engine and development kit.
2. Next, Adobe needs to create a seperate sub brand “Adobe Gaming Cloud” in addition it’s already existing 3 sub brands namely : Creative, document and Experience cloud, since this is a horizontal expansion into a new market.
3. Make the Gaming Cloud available on a monthly subscription basis to maintain uniformity with other sub brands and utilise the recurring revenue model.

Future of Adobe Gaming Cloud

Gaming as a Service is fast gaining pace within the gaming world. Big Tech companies have already started venturing into it with Google Stadia, Microsoft Xbox Game Pass and Apple Arcade. Amazon has recently launched Amazon Luna in partnership with Ubisoft to launch its gaming Service.

Adobe has a lot of potential in providing Gaming as a Service within its Gaming Cloud. For this, Adobe needs to partner with a game publisher that fits well with the core essence of Adobe. Adobe can partner with publishers like Activision Blizzard and Square Enix to provide exclusive access to their games on its cloud service. This service like those of its competitors will be available on a monthly subscription basis to the users.

Fin