Delivered September 6, 2019. Contributor: Hanine K.
Understand the current media communication strategies of Salesforce.
Salesforce’s vision to bring all software to the cloud was revolutionary. But Salesforce has been bringing their vision to life over the past 18 years. At the beginning, the concept of the cloud was abstract and unwieldy. To actually build their vision, they had to start with just one product.
Salesforce launched in the 1990s in Customer Relationship Management (CRM) market. It has grown into a full-fledged SaaS powerhouse. With an annual run rate exceeding $14 billion, it is by far the most successful pure cloud application ever created.
Salesforce began a strategy to grow through acquisitions. In 2006, it acquired the first of 55 companies when it bought a small wireless technology company called Sendia for $15 million. As early as 2006, the year before the first iPhone, the company was already thinking about mobile.
Salesforce.com made extensive use of early customer feedback to guide their product development efforts. Validating early with real customers kept the company focused on building a solution that created a great deal of customer value.
Salesforce.com took the risk of charging early customers zero dollars in exchange for useful feedback on their product. Through their early collaboration with Salesforce.com, these customers became dedicated advocates with an interest in seeing the company succeed. Converting them later to paying clients was easy. Given that they had already seen the value of the service, and were presented with a low-risk payment model, they had good reason to adopt Salesforce.com as their permanent CRM solution.
Since deploying a new marketing analytics tool in January 2017, Salesforce has produced such metrics as a 270% increase in converting marketing prospects to buyers, resulting in a 200% increase in a return on ad spend.
By the time Salesforce was around 15 years old, the company had become the incumbent in the industry they pioneered. As they move forward, they’re seeing smaller, nimbler startups enter their turf. They’re also seeing competition from other incumbents, like Microsoft and Oracle, who have now moved their products to the cloud.
In order to survive against threats of competition from companies like Microsoft and Oracle, Salesforce has shifted their strategy. Instead of nurturing up-and-coming SaaS companies, they’re competing head-to-head with the ones that threaten Salesforce’s growth. They are no longer primarily focused on creating tools, resources, and communities where others can build. Instead, they’ve doubled down on utilizing the latest technology to improve their own products in direct response to competitors’ moves.
This has resulted in horizontal and vertical expansion. They’re focused on improving their CRM by quickly adopting and integrating the newest technology and making it available to customers of all sizes. At the same time, they need to keep adding new cloud services to serve a wide breadth of use cases and compete with other enterprise providers, like Microsoft and Oracle.
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