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Adobe enhanced its current marketing cloud leadership position today, announcing record revenue just as key rival Salesforce made major announcements about expansions to its marketing cloud.
The battle is heating up.
Adobe capped off four straight quarter-over-quarter increases in marketing technology revenue with $368 million in revenue. That’s a 27 percent jump from last year’s third quarter, and represents an annual run rate approaching $1.5 billion in marketing cloud revenue — an impressive accomplishment in a largely still nascent market.
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“Content and data are the currency of business today,” Adobe CEO Shantanu Narayen said in a statement.
He’s right, and Adobe has done a class-leading job of building comprehensive tools for marketers — Adobe scored highest in our recent marketing cloud report — but it is also true that marketing is changing. For example, at its massive Dreamforce event, Salesforce today unveiled an extension of its marketing cloud into the company’s entire suite of sales, marketing, support, and service capability.
That suite highlights a potential problem for Adobe: the service and support side of enterprise.
A decade ago, marketing may have been a silo alongside sales, support, product development, and other silos. Today, great customer support is marketing, and marketing is great customer support. Companies like Salesforce, HP, IBM, and Oracle are integrating marketing functions into all components of the enterprise, helping brands market intelligently, market contextually, and market in a personalized way that depends on a prospect’s or customer’s entire experience … not just the fraction of it that occurs before any money changes hands. Adobe, of course, has little heritage in those parts of the enterprise.
But while that could pose a future challenge, today Adobe is doing great. Its revenue in marketing clouds is likely a 2X multiple of its nearest competitor — at least, of those that disclose revenue.
Over the past four quarters, the company has averaged a 15 percent growth rate in marketing cloud revenues. Continuing just that same growth rate for another four will bring its revenue in the next 12 months to over $1.5 billion, just from the Adobe Marketing Cloud.
But keeping the almost 30 percent growth rate from this quarter would be even more impressive, and bring the company over $1.7 billion in revenue.
That would not only solidify Adobe’s leadership in the space, it would also provide room for some acquisition — or incentive for what’s needed more, partnership — so that Adobe could address the entire enterprise and the entire world of the customer that marketers are now expected to understand, engage, and nurture.
VB’s marketing clouds report summarizes the insights of 1,500 marketers, millions of market penetration data points, and an in-depth review of 150 product features. It’s available for $499, or free with your martech subscription.
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