Adobe Creative Cloud Adoption Grows to 18 Million Paid Members
[UPDATE (December 2019) – In its full-year 2019 earnings call, Adobe said they grew Creative annual recurring revenue by 21% over 2018. Adding on to the estimated 15 million Creative Cloud subscribers from a year ago, this gives a likely new total of 18+ million subscribers.]
[UPDATE (December 2018) – A year ago, analysts pegged the number of Creative Cloud customers at 12 million: “We expect Adobe to end 2017 with 12 million subscribers for its CC services.” Most recently, Adobe stated in their Dec. 2018 conference call, “Within Digital Media, we achieved another strong quarter with our Creative business. Creative revenue grew 26% year-over-year in Q4.” Thus we estimate the current total to be approx. 15 million subscribers.]
Lately the rate of paid memberships has approached almost 1 million per quarter – adding 798,000 new subscribers in the past quarter alone (or 57,000 new customers each week) – which means that total number of subscribers has now reached 18 million since the CC product line replaced Creative Suite in June 2013.
Prior to the original launch of CC, Adobe had an installed base of 12.8 million customers using different versions of the older CS (Creative Suite) tools, which had been built up over a decade… The new subscription figures show that they have exceeded that user base for the new Creative Cloud products in the space of just a few years, at a steadily faster pace – an impressive uptake.
So Creative Cloud paid membership has now surpassed the previous Creative Suite user base entirely. That is very powerful, because all CC subscribers would be running and collaborating with the same creative software release, the latest-and-greatest available.
Adobe stopped selling CS6 online but the Creative Cloud compares favorably on almost all measures and is one of the company’s highest-rated major products ever – likely because it gives access to almost everything they make, all for one easy price with no steep upfront costs.
From Adobe’s third quarter conference call:
In Digital Media, the transition to subscriptions is happening faster than expected. Creative Cloud has become the de facto platform for all creatives, providing the tools and services to fulfill every creative need. We are migrating existing customers from our Creative Suite installed base, as well as attracting large numbers of new users with strong adoption across our Individual, Team and Enterprise offerings.
Continuous innovation is the hallmark of Creative Cloud and the catalyst for our retention and growth. Creative Cloud innovation is forging ahead in the mobile space, where our mission is to help creatives bridge their desktop and mobile design processes into a seamless creative workflow. Our plan to deliver new value through compelling services such as Adobe Stock to augment our desktop and mobile applications is off to a strong start. We will continue to deliver new services, and partner with the broader ecosystem to make Creative Cloud the one-stop shop for creative inspiration.
Highlights in our recent quarter include accelerating adoption of Creative Cloud, driven by strong net new CC subscription additions. Across all routes to market, we continue to see solid demand for Creative Cloud, with large portions of our legacy perpetual customers moving to a subscription model. In addition, we are now migrating significant numbers of hobbyist customers who previously used Photoshop Elements and Lightroom on a perpetual basis to the Creative Cloud Photography offering. And we are seeing on Adobe.com that the vast, vast majority of people who are buying Acrobat DC are buying the subscription option.
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And the following comes from an earlier conference call:
In our Digital Media segment, we continued to make great progress with our Creative Cloud service as customer adoption proceeds more quickly than we anticipated. Subscriptions have grown faster than expected and, as a result, perpetual Creative revenue has fallen off more quickly. In addition to paid members, we currently have millions of customers who are trying out the free service.
In addition to success with Creative Cloud for Individuals, Creative Cloud for Teams also had strong results, growing 62% quarter-over-quarter. Teams and groups of creatives are realizing the collaboration benefits from being on the same version and the ability to seamlessly share files, fonts and preferences, and enterprises are increasing their adoption due to simplified licensing models and integration with Adobe Marketing Cloud’s digital asset management capabilities.
The Creative Cloud offering continues to evolve to ensure that we are satisfying our existing subscribers and attracting new members. In the surveys that we are doing, over 20% of the user base who are adopting the Creative Cloud are completely new customers for us. Last fall, we introduced the CC Photography Plan, providing Photoshop and Lightroom via Creative Cloud to professional photographers and hobbyists at an affordable monthly price. Uptake on this offer has been strong, and we believe adding these users is accretive to our long-term goals.
The company sees even greater CC growth ahead:
Our strategic goal continues to be to accelerate adoption of Creative Cloud, and we are focusing all of our innovation there. We’ve added thousands of new and improved features to Creative Cloud since CS6 came out in 2012, which is driving higher customer satisfaction. What’s more, we experienced strong retention among individual customers renewing at full price as their introductory promotions expired. And so we’re pleased so far with what we are seeing in terms of renewal rates, which are above what we originally modeled.
It’s nice to see that we’re ahead of the metrics we forecast, not just the annual numbers we provided last year, but the analyst meeting in November 2011 as well when we started this transition. And we reflect that no company has gone through a transition of this magnitude. And for us to be ahead of our goals I think demonstrates the value we’re providing to our customers. And the confidence in both the strategy and our ability to execute enables us to be optimistic about our growth prospects for the next three years.
You can read that full transcript here.
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Quick Look at What’s New in CC 2017
For more details, see: What’s the Difference Between CC 2017 vs. CS6 & Older?
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