Adobe Targets Marketing Cloud Services
Adobe, seeking to build on an unparalleled five-year run of success for its stock, is targeting a potential area of growth that will pit the software company against its biggest competitors, according to Bloomberg. The company has dominated in the field of digital media, the graphics and web-design software that generates about two-thirds of $4.8 billion in annual sales. Now it’s expanding its focus on marketing services, where the company will compete directly with Salesforce, Oracle, Alphabet and IBM.
While the rivals may be bigger, Chief Executive Officer Shantanu Narayen is bolstering spending and looking for partnerships to drive the effort after showing Wall Street that Adobe could transform itself into a cloud company over the past several years. He’ll give investors the latest update when the company announces quarterly results. To gird for the sales fight, Adobe signed a deal in September with Microsoft making Adobe’s business marketing products the favored choice on Microsoft’s Azure cloud-computing service.
Adobe was among the first software vendors to switch its sales approach from one-time licenses to subscriptions, which let customers use its products online through the cloud without having to install the software on their computers. The strategic change, credited to Narayen, gave Adobe the flexibility to update and improve its software quickly and is cited as a key reason the stock has increased 366 percent since a low of $22.69 in August 2011. The share rise is the third-biggest increase during the period in the 67-member S&P 500 Information Technology Sector Index, trailing only chipmakers Broadcom and Nvidia.