Salesforce.com will launch a major strategic shift next week from a sales-driven CRM company to one focused on long-term customer success.
Salesforce CEO Marc Benioff leaked part of the plan last month with a tweet that mentioned plans for an Analytics Cloud, but that is only part of a broader vision. The company, a pioneer in cloud-based software, will announce the new analytics service on Monday. On Tuesday, Benioff will outline how those tools will enable the company's evolution into a "customer success platform," a source close to the company confirmed today.
"We will be announcing the Analytics Cloud at Dreamforce, but that's just one of the new announcements we've got," CMO Lynn Vojvodich said during an interview with Bloomberg TV.
As it has in the past, this year's show, which is expected to draw up to 135,000 attendees, will transform much of San Francisco's South of Market district into a sprawling technology campus. The four-day show will feature celebrity-studded speeches by former US Vice President Al Gore, singer-songwriter Neil Young, Andreessen Horowitz co-founder Marc Andreessen, Hillary Rodham Clinton and others. Singer-songwriter Bruno Mars will headline a charity concert.
However, most of the conference will focus on explaining how the new Analytics Cloud will bolster the power of applications, turning them into predictive tools that can help marketers and sales reps assure the long-term success of their customers.
A banner already draped across the entrance to the Moscone Center convention complex identifies Salesforce as "The Customer Success Platform," reflecting its new focus on lifetime customer value. It's a significant change for Salesforce, whose stock trades under the ticker CRM. Benioff's speech on Tuesday is scheduled to begin a half-hour after the market closes. Shares closed today at $57.13, just below the midpoint of their 52-week high of $67.00 and low of $48.18.
Analytics and Customer Success
Unlike traditional sales efforts that tend to be tied to closing a contract, customer success programs monitor customer health through a continuing process, from the point of first contact through contract renewal. The customer success approach is especially important for software vendors that have transitioned from one-time sales of on-premise software to month-to-month subscriptions for Software-as-a-Service (SaaS).
The analytics cloud fits well with the customer success vision. Cognitive computing in the cloud will help make applications like customer relationship management and customer success much smarter. For example, instead of simply tracking the progress of sales prospects in the pipeline, companies may be able to predict which customer will respond to a certain message at a certain time.
"Over the next year and one-half -- we're saying by the end of 2015 -- 50 percent of applications are going to be predictive. The applications are going to be smarter. They're not going to be dumb," Jim Lundy, CEO of Aragon Research, said in a CMSWire interview earlier this week.
Optimized Partner Apps
CMSWire has learned more than 15 Salesforce partners in varied fields have quietly developed applications that demonstrate the capabilities of the Salesforce analytics service, which will be available to customers on Oct. 20. Major product announcements are expected next week from Jitterbit (integration), Velocify (sales automation), Apttus (sales quotations) and Birst (decision making), among others.
"Salesforce Analytics Cloud will be an effective tool for uncovering new insights and supporting data-driven action," said George Gallegos, CEO of Jitterbit. He said that with his company's Harmony cloud platform "we will be able to provide the fastest path for companies to connect the [analytics cloud] to the rest of the enterprise."
"We see this delivering powerful benefits to our joint customers," Monica Girolami, head of marketing in North American for NewVoiceMedia, said in an email. She added that customers "will be able to combine their Salesforce insights with NewVoiceMedia metrics and other AppExchange metrics through a powerful analytics cloud," enhancing their strategic decisions.
Competition in Analytics
Most other large software companies have already introduced cloud-based computing, but Salesforce will have apps that are already tuned to its platform. Oracle stressed cloud-based analytics at OpenWorld last week. IBM recently released its Watson Ecosystem. Adobe Analytics today announced tools for Mobile Apps. Microsoft Azure, Google's Compute Engine and Amazon Web Services also offer similar services.
"We have long thought that [Salesforce] would eventually be adding an Analytics Cloud, given some of the strategic buys they have made," Jason Maynard, an analyst for Wells Fargo Securities wrote in a recent research report. "We are assuming that the analytics capabilities [of the Salesforce platform] will feature more comprehensive reporting functionality with visual analytics and drill-down features."
The fact that Salesforce is launching an analytics tool at all signals a turn-around from last year's Dreamforce conference, when Benioff said Salesforce "does not intend to move into the traditional, horizontal analytics market." He also claimed the company was already "a massive analytics provider through millions and millions of dashboards that are being generated by all our customers."