Salesforce CEO Marc Benioff has slagged off his CRM competitors for doing “a horrible job” which has cleared the way for his outfit to make a fortune.
The cloudy software vendor saw its revenue for the three months ending 31 July jump 26 per cent year on year to $2.56 billion – making it the first enterprise software company to hit $10 billion,.
However that would not have been possible, claimed Benioff, if Salesforce’s CRM rivals had not “abandoned” the CRM market.
“When you’re in enterprise software you have to realise, its hard work [and] not everything is going to be perfect all the time – there is going to be problems,” he said. “That’s why being so committed to the customer is more important than ever.
“I have to say our competitors have really done a horrible job in last few years. I just would say that a lot of them have abandoned the CRM market.
“If you talk to the major CRM analysts, and we do that, we just had one of them at our management conference, they are shocked. We’re shocked at how these companies have really walked out of the CRM market. Companies that had huge multibillion dollar positions in the CRM have conceded that market to us.”
Benioff said the actions of others in the market has created an “exciting” opportunity for Salesforce and its chums.
Cloudy outfit Vlocity has announced today that the UK’s Azur has chosen Vlocity Insurance and Salesforce to further improve customer engagement and satisfaction for brokers and their clients.
Vlocity Insurance is built on the Salesforce platform and Azur wants the tech to engage with policyholders across multiple environments.
Azur cuts transaction chain inefficiencies by using technology solutions that disrupt expensive, inflexible legacy systems. By using Vlocity Insurance’s industry-specific and omnichannel capabilities built on the Salesforce platform, Azur can tailor broker and policyholder management processes.
Azur founder and CEO Graham Elliot said that Azur wanted to change the broker and policyholder experience by pushing outside of industry norms and bringing in new technology to disrupt the status quo.
“With Vlocity Insurance and Salesforce, we have a more complete picture of how we are measuring against this goal because all the necessary systems are in one easily navigable platform built on insurance industry standards.”
Salesforce Global Head of Insurance Jeff To said that the partnership between Vlocity and Salesforce provides agility and insurance industry depth to the customer interactions that Azur requires.
Using Vlocity’s industry cloud software, Azur has configured a multi-line underwriting system that enables content marketing engagement, broker on-boarding, quote and bind, documentation, claims handling, mid-term adjustments, and core system of record functions with all of the data in one place. Vlocity Insurance also eases the transition of legacy insurance systems and historical documentation to the cloud by connecting and integrating with current systems of record.
Software King of the World, Microsoft, is rolling out upgrades to its sales software using data from LinkedIn.
Microsoft CEO Satya Nadella said that the cunning plan was central to the company’s long-term strategy for building specialised business software.
The move means improving Vole’s sales software Dynamics 365, so it can take on market leader Salesforce.com. It is the first thing to come out of Microsoft’s $26 billion acquisition of LinkedIn, the business-focused social network.
The new features will comb through a salesperson’s email, calendar and LinkedIn relationships to help gauge how warm their relationship is with a potential customer.
The system will recommend ways to save an at-risk deal, like calling in a co-worker who is connected to a potential customer on LinkedIn.
“The artificial intelligence, or AI, capabilities of the software would be central. I want to be able to democratize AI so that any customer using these products is able to, in fact, take their own data and load it into AI for themselves,” Nadella said.
LinkedIn has 500 million members globally, one of the first big milestones for the business social network since its acquisition.
Salesforce forecast current-quarter revenue above what the cocaine nose-jobs of Wall Street predicted.
Deferred revenue, a key metric for subscription-based software businesses, rose 23 percent to $3.50 billion in the third quarter. Analysts on average had expected deferred revenue of $3.42 billion. For the current quarter, Salesforce said it expected revenue of $2.27 billion to $2.28 billion, above analysts’ average estimate of $2.24 billion.
Revenue rose 25.3 percent to $2.14 billion. Analysts had expected revenue of $2.12 billion. Chief Executive Officer Marc Benioff said that Salesforce was expecting to deliver its first $10 billion-year during our fiscal year 2018.
The more optimistic predictions were due to closing deals for its cloud-based sales and marketing software with several new major customers.
Salesforce has consistently reported double-digit growth in recent quarters as companies shift to cheaper and easier cloud-based products, but it is facing growing competition from Oracle and Microsoft.
The results marked a sharp reversal from the previous quarter, when a lighter-than-expected revenue forecast prompted concerns about slowing growth. But this quarter the company closed large deals with customers including Citigroup and Amazon to help it get back on track.
Benioff wants to broaden the company’s cloud offerings through new features, especially focusing on artificial intelligence.
The company, which launched its artificial intelligence platform Einstein this year, has made several acquisitions to build up its machine learning and big data analysis power.
However, competition between Microsoft and Salesforce is now intensifying and Microsoft’s Dynamics product is taking business from Salesforce among mid-sized customers. Microsoft also this summer launched a direct competitor to Salesforce’s AppExchange for business software.
While most channel partners might not be too interested in AI trends, Salesforce has a cunning plan to use the concept to spice up its partner relationship management software.
Salesforce’s PRM software, which is delivered as a service, uses an Einstein AI engine that the software outfit thinks could change the way the channel is run.
At the moment, PRM applications are loaded with data about customer transactions, but sorting through all that data to make the best optimal decision is laborious. Einstein is supposed to instantly identify what combination of products and services will, for example, yield the most profit for them.
Channel management teams can identify what partners make the best use of marketing development funds (MDFs) or have higher customer satisfaction ratings with a specific product or technology.
This means that the vendor can better identify when a customer is most likely to upgrade an existing product or service.
While this will not mean the end of the days where a nice lunch would improve vendor standing, it will mean that sales teams will come to the table with some good facts about what the client wants.
The technology is still limited AI technologies start to cut both ways in the channel. Instead of a PRM application, there will inevitably be a vendor relationship management (VRM) application infused with AI capabilities. Solution providers would then be able to instantly compare which vendor in a category, such as servers and storage, is providing them with the best deal at a given time.
Salesforce has said it has given up on its plans to buy social notworking site Twitter.
Salesforce CEO Marc Benioff told the Financial Times his company has “walked away” from cutting a deal and he was pretty much the last one left.
Neither Google nor Disney plan to bid on Twitter, despite reports saying both were interested. Apple is long gone and Verizon immediately launghed off the speculation.
Facebook was said to be uninterested, and someone mentioned Microsoft but then realised that it made no sense for Vole which is becoming an increasingly enterprise-focused company.
This is going to put pressure on the social notworking site to work out a way to restart user growth and improve its revenue.
Twitter will update investors on its earnings again two weeks from now, on 27 October and it’s likely the company will either address or be asked about where any acquisition talks go from here.
Salesforce has called on EU regulators to investigate antitrust issues related to Microsoft’s $26 billion bid for social network LinkedIn.
Vole is expected to seek EU antitrust approval in the coming weeks for its largest ever deal and Salesforce, which missed out on the sale is complaining.
It has asked competition authorities to go beyond a simple review, saying the deal threatens innovation and competition.
Burke Norton, Salesforce’s chief legal officer, said in a statement said that by gaining ownership of LinkedIn’s unique dataset of over 450 million professionals in more than 200 countries, Microsoft will be able to deny competitors access to that data, and in doing so obtain an unfair competitive advantage.
“Salesforce believes this raises significant antitrust and data privacy issues that need to be fully scrutinized by competition and data privacy authorities in the United States and in the European Union,” he said.
Brad Smith, Microsoft’s president and chief legal officer, said in a statement: “Salesforce may not be aware, but the deal has already been cleared to close in the United States, Canada, and Brazil. We’re committed to continuing to work to bring price competition to a CRM market in which Salesforce is the dominant participant charging customers higher prices today.”
The European Commission’s preliminary review of merger deals lasts 25 working days, which can be extended by about four months if it has serious concerns.
Cisco and Salesforce are combining their Internet of Things and unified communications technologies in a cunning plan to provide joint offerings to drive channel sales in the new markets.
The networking giant will co-develop and co-market new joint offerings that combine its platforms in collaboration, IoT and contact center with Salesforce Sales Cloud, IoT Cloud and Service Cloud offerings.
Under the cunning plan Cisco Spark and WebEx will be integrated into Salesforce’s Cloud and Service Cloud. Combining these two technologies will allow customers to communicate in real time using chat, video and voice without leaving Salesforce or having to install a plug-in.
Cisco’s Jasper IoT platform, which it bought in its $1.4 billion acquisition of Jasper Technologies earlier this year – will be integrated with Salesforce’s IoT Cloud. Cisco said the joint offerings will empower organisations to quickly and cost-effectively use billions of IoT data points and provide businesses with a more comprehensive view of their IoT services.
Rowan Trollope, senior vice president and general manager of the IoT and Applications Groups at Cisco said that Cisco and Salesforce were coming together to form a strategic alliance can eliminate the friction users experience today so they can become more productive.
The alliance will also combine Cisco’s Unified Contact Centre Enterprise and Salesforce Service Cloud to help customers manage call centres more efficiently, according to a release.
Salesforce is carrying on its “shop until you drop” policy and made its fourth acquisition since June.
The outfit has written a cheque for business analytics provider BeyondCore. It is not saying how many zeros it wrote on the cheque.
For those who came in late, BeyondCore examines data sets using pattern-recognition technology using its own algorithms that combine machine learning and regression analysis.
It is not a big outfit, It has 15 stuff and it was founded in 2004. Its cash came from $9m in funding. Salesforce became interested when it came up with a plug-in to connect to its cloud.
Writing in its bog, BeyondCore wrote it would be “uniquely positioned” to further magnify its impact on analytics as part of Salesforce’s Analytics Cloud.
The deal would extend “smart data discovery and advanced analytics capabilities across the entire Salesforce Customer Success Platform,” BeyondCore said.
Salesforce’s just bought the Microsoft-Office-like suite Quip for $750m stock and cash earlier in August and the ecommerce platform Demandware for $2.8bn in cash.
While most people are at a beach it appears that Salesforce is keen to carry on its shopping frenzy.
Although he is not backward about coming forward at the best of times, Oracle Chief Technology Officer Larry Ellison has been talking up his outfit’s Cloud business lately, claiming it is doing rather well because if its SaaS presence.
Ellison claims Oracle’s cloud business is “defying conventional wisdom” by accelerating while it expands and this is because of its presence in the SaaS market where rivals are not competing.
“We think we have a fighting chance to be the first SaaS company to make it to $10 billion in annual revenue,” Ellison said.
Oracle is a number two SaaS vendor and had a total SaaS and PaaS revenue of $2.2 billion during fiscal 2016, up 49 percent from the year before. The top SaaS vendor, Salesforce made $6.67 billion in 2016 and expects its 2017 revenue to be $8.08 billion.
Public cloud IaaS leader Amazon Web Services said in April that it’s on track to hit $10 billion in revenue this year.
The cloud accounted for around eight percent of Oracle’s quarterly revenue, but this business to continue growing even faster in Oracle’s fiscal 2017.
Ellison also said Oracle is seeing “a huge amount of demand” for IaaS from its existing SaaS and database customers, which wish to avoid the data migration costs associated with AWS and other cloud vendors.
Oracle has made significant data centre efficiency advancements and can now offer lower costs, better security and superior reliability than any other provider in the market, he added.
Cloudy Salesforce has written a $2.8 billion cheque for Demandware whose software is used by businesses to run e-commerce websites.
The move is part of a cunning plan to open a new front as Salesforce wants to take more market share from traditional software providers such as Oracle and SAP who offer cloud-based e-commerce services.
The e-commerce market has been growing as retailers expand their online presence, boosting demand for software that helps manage functions such as payment processing and inventory management.
Salesforce appears to have paid rather a lot for the company to see off any of the other outfits which were bidding for the company. Word on the street is that Adobe and Oracle were also snuffling around.
Demandware has not been doing that well. Its shares, which have fallen about 21 percent in the past year. Its customers include Lands’ End, L’Oreal (because it is worth it) and Marks and Sparks. It has reported sales growth of more than 30 percent for the last 10 quarters.
While Salesforce has beaten up everyone in the CRM war, it still needs to stay in front. To do that it needs lots of products which is something it lacks.
Global spending on digital commerce platforms is expected to grow over 14 percent annually to about $8.5 billion by 2020, Salesforce.
The deal, slated to close in Salesforce’s second quarter ending July, is expected to increase the company’s 2017 revenue by about $100 million-$120 million.
Salesforce had forecast fiscal 2017 revenue of $8.16 billion-$8.20 billion in May.
Salesforce reported higher than expected quarterly revenue and raised its full-year revenue forecasts.
In a statement the outfit said that customers were stepping up purchases of its web-based sales and marketing software despite economic uncertainty.
Salesforce is becoming a barometer for the cloud-computing sector. It has done well as companies wanted cheaper and easier cloud-software services.
Salesforce highlighted new or expanded deals with customers such as Charles Schwab, the financial-services company, and consumer-goods maker Unilever.
Chief Financial Officer Mark Hawkins on a call with analysts that while the papers seem to be full of doom Salesforce has not seen an economic impact.
Part of the reason, executives said on the call, was that Salesforce often skipped over the information technology department, an area where flat spending is expected this year, and sold to other departments.
Some technology companies that have flagged potential weakness this year sell infrastructure equipment or other products that typically fall under an IT budget.
The company raised its full-year revenue forecast to $8.08 billion-$8.12 billion, from $8.0 billon-$8.1 billion.
In the fourth quarter ended January 31, revenue from sales cloud – a suite of software that allows companies to track leads, forecast and collaborate around sales opportunities – rose 12.3 percent to $708.9 million.
The net loss narrowed to $25.5 million, or 4 cents per share, from $65.8 million, or 10 cents per share, a year earlier.
Revenue rose 25.3 percent to $1.81 billion, above analysts’ estimate of $1.79 billion.
Salesforce has just bought six-year-old startup SteelBrick for $360 million which will become a wholly owned subsidiary after the deal closes in April 2016.
SteelBrick is expected to bolster Salesforce’s Sales Cloud business, by far the largest segment of the company. But it’s unclear how it plays into Salesforce’s recent move to target larger enterprises because SteelBrick is largely for small companies.
The deal was rumoured since last week but the deal size is almost half of the expected $600 million amount.
Salesforce was already an investor in SteelBrick, so the final price might reflect what Salesforce paid without including its existing stake.
SteelBrick offers quote-to-cash (QTC) technology that makes it easier for salespeople to put together complex quotes and billings for potential customers. The company last raised $48 million in October at a reported valuation of $250 million.
The startup is run by Godard Abel, the former CEO of BigMachines, another QTC software maker acquired by Oracle for $400 million in 2013. There’s a number of popular QTC solutions in the market, but SteelBrick is different in that it mostly deals with small- and medium-size businesses.
The SteelBrick acquisition marks the largest deal in more than two years for Salesforce. The last startup deal it made of any note was when it bought RelateIQ for $390 million last year.
Salesforce has surprised the cocaine nose jobs of Wall Street by raising its full-year revenue forecast for the fourth time after reporting a quarterly adjusted profit above market expectations.
As you might expect, the rise in money has been driven by higher demand for its web-based sales and marketing software.
San Francisco-based Salesforce has been benefiting as more businesses choose cheaper and easier cloud software services. The company provides its services online, with no software directly installed on PCs.
The company’s adjusted operating margin expanded to 13.3 percent in the third quarter ended October 31 from 11.3 percent a year earlier.
Salesforce raised its revenue forecast for the year ending January 2016 to $6.64 billion-$6.65 billion from $6.60 billion-$6.63 billion.
Revenue rose 23.7 percent to $1.71 billion in the third quarter. Analysts on average had expected $1.70 billion.
Salesforce has been slowly killing off Oracle and SAP in the customer relationship management software market.
The company’s net loss narrowed to $25.2 million from $38.9 million a year earlier.
Earlier this year Microsoft offered $55 billion to acquire Salesforce only to be turned down by CEO Marc Benioff who countered with a $70 billion price tag.
It appears that Microsoft is not taking the snub lying down and is upping the competition against Salesforce’s most important product.
Beancounters at JP Morgan said that Microsoft is Salesforce’s biggest competitive threat in the cloud CRM market.
It surveyed vendors to ask what the biggest change you have seen in the competitive landscape facing Salesforce.com in recent months?
Of the 56 vendors that participated, 23 percent of them said Microsoft. That’s way ahead of number two Oracle, which was only named by 11 percent.
Microsoft becoming more visible and competitive in the Cloud arena while others are stagnating, cited by 23 per cent of partners.
One comment said that Microsoft was closing some ground in terms of retooling their platform to what is now becoming a cloud-dominant computing space.
The survey asked only 56 Salesforce partners, but the survey reflects how Microsoft may indeed be closing in on Salesforce in the CRM space.
Salesforce is seeing much more competition from Microsoft Dynamics, which is going all cloud based and is significantly cheaper. Microsoft was winning some sizable CRM deals.
Microsoft only had 5.8 percent of the CRM market share last year, ranking fourth behind Salesforce, SAP, and Oracle. Salesforce was the leader with 16.3 percent market share.
Gartner has also said in its Magic Quadrant Survey that Microsoft Dynamics CRM is “experiencing renewed investment and focus within Microsoft,” and that it was the second most asked for CRM product in a global survey in the first quarter of 2015.
All this means that Microsoft is putting the thumbscrews on SalesForce by taking away its crown jewels. If it gets away with it, Salesforce might be forced back to the negotiating table. Either way, life is not going to be as good for Benioff as it has been.