Brian Fitzgerald: Yes. Thanks, guys. Wanted to know what the product simplification efforts, have you seen any early signs of improved conversion that has given you confidence that we can reduce the emphasis on paid marketing that maybe scaled the top of funnel? And then related, wondering how you’re thinking about continuing to feed that type of funnel? Is the plan to lean back into paid marketing at some point in the future, and any preliminary thoughts on how that would kind of phase in?
Gillian Munson: Yes. Let me take the number side of that, first, Brian, and then I’ll have Adam talk about through the strategic side. So from a paid marketing perspective, we’ve been bringing down paid marketing over the course of 2023, and have in Q3 delivered better bookings than we had been reducing the rate of decline there. It’s a careful balance. It’s early days on really doubling down on the product versus paid strategy at the company, so a little bit early to see full results there. But I think what you’re seeing is the team has been doing a lot of work all year long to build features and functions to make it as we’ve talked a lot about, make it easier to get to the features that are the best at Vimeo, make it easier to onboard with Vimeo.
And I think our belief is that as we start to see better and better usage, that’s going to bring us that product led growth as opposed to the paid marketing growth. And we feel very optimistic that that’s doable, super early days in terms of really doubling down on that. I think it’s a while before we would say, okay, let’s not turn back on the paid marketing. I think our real focus is making — we have a lot of folks who touch the Vimeo product. I think it’s like 50 million viewers even see the product and millions of people use the core product every month. And there’s a lot of opportunity in that for us to sell subscriptions to those folks. So I think we still have time until you’d get to a place where you’d say, okay, let’s now reassess the paid marketing strategy.
Right now, I think we’re really focused on product more than paid. It doesn’t mean we don’t spend money on paid. We do. So I would be remiss if I said that we’re not spending on paid. But I think we are really trying to shift that orientation because we think it’s healthier for the business over time. Adam, do you want to add anything?
Adam Gross: Yes. As you mentioned, it’s still pretty early in the journey on thinking about the strategy in this alignment. The one thing I would keep an eye on is all the things that we are doing on the product, as Gillian mentioned, last week we announced our new video marketing solution. Inside of that is an entirely new editing experience. Another product innovation we’ve had in the past 30 days alone is a new AI powered teleprompter, which follows you as you speak to kind of prompt and scroll the words accordingly. I encourage you to check it out. It’s really cool. And I think it’s those kinds of investments, that kind of innovation that’s going to be really key to unlocking the opportunity that we have in enterprise video. So really excited about what we’ve shipped and excited about the pipeline of new capabilities we’ve got coming.
Brian Fitzgerald: Got it. Thanks, both. Very helpful.
Ken Goff: Our next question comes from David Lustberg at Jefferies. David?
David Lustberg: Thanks. Hi, guys. I have two maybe just to start and then a follow up. In the letter you said you saw some Vimeo Enterprise headwinds in Q3, I think you said mostly around SMB side due to execution issues that you guys are addressing. Maybe if you could just start by walking through what some of those execution issues were, it’d be helpful?
Gillian Munson: Sure. So in Vimeo Enterprise, during Q3, we started to see some headwinds in our pipeline. It was across the board but a little heavier in SMB than in other categories. We think this is largely execution. And really the execution is in how we take leads into the system and make them into real opportunities. So it’s a lot of items around focusing on leads, responding to leads, how quickly we’re getting to them, things like that. All of this we are addressing. That said, as we’ve looked at the data and we think about SMB being a place of a little bit more weakness than other, we suspect there’s probably a little bit of macro in there as well. But in our view, our destiny is ours to fix. And we actually think that for the most part, this is about us executing better in that category as opposed to it’s all macro, and that’s our issue. So we’ll work on that. We’re out there working on it now and hope to turn that around.
David Lustberg: Got it. That’s helpful. And then maybe just as a follow up, in the letter, I think Adam, you talked about your cash position and how it provides a wide array of investment opportunities going forward. Maybe if you could just talk through what are some of those investment areas in the business that you might be thinking about leaning in, in order to deal with that cash position? Thanks, guys.
Adam Gross: Yes, sure. Thank you for the question. Happy to speak to that. Obviously, it’s too early for us to say anything definitive about how we want to use that. But I think if you look even in the past 30 days at some of the things we’ve been talking about and releasing, it signals a lot of our strategy. Fundamentally, one of the things I’m really focused on is how do we become more strategic to our customers. We know that companies of all sizes need help navigating the new world of enterprise video, whether that’s in the marketing domain, whether that’s in how companies use that if they’re in the media business, and increasingly also in knowledge sharing and collaboration. So, as I mentioned, you saw investments that we’ve made in the editor.
We’ve also made additional investments in our core player technology, which is probably the industry standard for Internet quality video playback. And all of these — we introduced new analytics capabilities to help our customers understand how video is being used. All of these are efforts that are designed to either attract and convert customers or to ultimately become more strategic to our customers. And we think there’s just a lot of opportunity to do that across those different areas that I mentioned.
Gillian Munson: And, David, I might add for that. When we talk about investing, it’s all a balance. So what we are committed to is being a profitably growing company. So I want to make sure we’re not leading you the wrong direction on that. I think it’s just more about the level. I think that what we’re trying to say is in Q3, we might have swung a little bit too positive relative to the level of investment we want to make. So don’t expect us to go into a loss position. That’s not our strategy. We want to be a profitably growing business as well.
