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Adobe president and CEO Shantanu Narayen: 'Agencies are going through change and we are not apologetic about it'

Adobe president and CEO Shantanu Narayen discusses digital disruption with The Drum / Adobe

Following the launch of the Experience Cloud earlier this year, Adobe president and chief executive officer Shantanu Narayen said media agencies need to take advantage of the disruption that martech was creating, or else become victim to it.

Speaking to The Drum at the Adobe Symposium in Mumbai this week, Narayen discussed the vision for Adobe, which has spread beyond the marketing functions of enterprises to the whole business, shown in the recent launch of its Experience Cloud, of which its original Marketing Cloud is a part of.

Future-proofing has made its way into board-level conversations at businesses and stirred unease within the ad industry, most specifically the media agencies, many of whom are having to adapt to increased automation and brands pulling management of media in-house.

​'The big opportunity'

When asked what his opinion of this friction was, Narayen was bullish about the importance of agencies as partners, specifically those willing to take advantage of technology available to them.

“First let’s look at the way we look at the big opportunity: We have, let's say, a $2bn business in digital marketing, which is the segment we use to report our revenue. Traditionally partners make four-or-five dollars for every dollar spent on the licensed software that we make. So we have created a multi-billion dollar opportunity for partners to leverage,” he said.

The media buying side opportunity Adobe is creating for partners is one of the newer sides however, boosted by recent acquisitions, such as programmatic video specialists TubeMogul.

Not all partners are created equally

He said that Adobe will not apologise for its part in the disruption of the ecosystem and that not all partners are created equally in terms of adapting to the challenge.

“There are two types of partners. There are the traditional systems integrator partners; the Accenture’s, Deloitte's, TCS’ and Infosys’ of the world. They have been accustomed to how they partner with enterprise software companies, which is that they don’t look at them as competitive and they partner with them,” he explained.

“I think with agencies it is a little bit trickier because they did two things. They did a lot of creative strategy and implementation and I think that remains as relevant, if not more important than ever before because, with the amount of content that people are creating, it’s even more important to differentiate yourself

Take advantage, or take a bow

“What the media agencies did was they did the media buying on behalf of customers and that is becoming more programmatic and technology is making that transparent, and that’s not just Adobe. Disruption is happening and you can look at all these opportunities and say ‘disruption is happening and I can take advantage’ or ‘disruption is happening and I can’t’," he said.

"We would never disadvantage a partner but we have this vision that media buying is going to become more programmatic because technology is going to automate it. We will partner with anyone, and we’d like to partner with people from that particular media buying space, but they are going through change and we’re not apologetic about it,” added Narayen.

In line with this, Narayen conceded that in order to help businesses with digital transformation, Adobe is reliant on partners to scale. A key headline from its partnership strategy came earlier this year when the business announced it would start working alongside Microsoft to pool sales and marketing expertise.

Ultimately, these partnerships mean that it can double down on ‘experience’ software, which is “setting stage for next phase of expansion for Adobe.”