Salesforce.com Earnings Call Nuggets: the Force Business and CMOs
Salesforce.com, Inc. (NYSE:CRM) recently reported its fourth quarter earnings and discussed the following topics in its earnings conference call.
The Force Business
Adam Holt – Morgan Stanley: My first question is about the Force business and the strength there. Are you seeing higher attach as you’re doing more large deals around SFA extensions? Or are you seeing expanded used cases, that’s continuing to perpetuate the Force strength?
Marc Benioff – Chairman and CEO: I think it’s a great question, and I really appreciate that because we’ve been focused on building our platform now for many, many years. Of course, we provide a single customer platform, it lets you accomplish what you need to do as sales productivity, it lets you accomplish what you need to do in customer service and support and call center. It allows you to accomplish what you need to do in marketing, whether it’s listening, publishing or advertising. We really didn’t get into some of the exciting announcements that happened this quarter with the Marketing Cloud, including our exciting relationship with Twitter and being the pioneer of the Twitter API and connecting our new social advertising product with that. What I can tell you is that in each and every customer case, we’re seeing expanded use of our platform and I was with a large financial services customer as I mentioned this week in New York and it’s a company that has built many applications on our platform and it wasn’t really surprising to me that we’re starting to talk about it becoming their standard way of building all their applications. It’s a faster way to build applications. It’s certainly a lower cost way to build applications. It’s an easier way. It’s elastic as companies change and evolve, the platform can move with them. These are not characteristics that you found in the client server world and I think that’s why the platform is so attracted to so many customers. Also, we’ve really doubled down on our relationships with the large systems integrators. You see them at our show, like in New York, you’ll see the big SIs, whether it’s the well-known ones like Accenture or even the mid-tier market SIs, many of whom we have a very strong relationship with, having a lot more competency with the platform, this gives customers, an easier time to deploy it. so, I’m very optimistic about the future of the platform. I feel that customers understand it more than ever before. They have universally positive experiences with it and I think that they’re going to do more and more with it. I appreciate the question because, it’s one of the things that I’m especially excited about.
Kirk Materne – Evercore Partners: Mark, I know you and Michael are spending a lot of time out there talking about CMOs and I was just curious of your perception. Are they ready to take on a full platform approach t so some of the challenges that come about with social media? Or do you see them taking on more of an incremental approach and if it is the more full platform approach, I guess, how do you feel about having all the pieces there to be able to help them solve their challenges?
Marc Benioff – Chairman and CEO: Well that’s just an outstanding question and I’ll tell you why. When we talk to Chief Information Officers, we talk to them on a very strategic basis in terms of their (decadent) strategy and what they’re going to be doing with their companies going forward. But when we are talking to Chief Marketing Officers, of course they are strategic but their needs are much more tactical. They’ve got campaigns that are executing today. They have needs that they need executed – needs that need to get fulfilled today. They have problems that need to get solved now and those Chief Marketing Officers they may decisions with a different frame than Chief Information Officers. That’s why we encourage these CMOs to partner with the CIOs. We are trying to build a muscle at Salesforce that we can talk comfortably with CMOs just like we talk comfortably with Chief Information Officers or Chief Revenue Officers or Chief Service Officers and certainly Chief Executive Officers. Our job is to be able to sit with that management team, something I did several times this week and have a holistic conversation about how their company is connecting with their customer. It doesn’t matter who that company is, whether its General Electric, or whether its Philips or whether it’s Bank of America, whoever it is in our portfolio of customers. In each and every case they are re-defining, re-conceptualizing and re-energizing their own employees about how they connect their company with their customers and that’s why we called it a customer company. The CMO is a relatively new entry into the conversation. That’s why we have spent $1 billion buying Radian6 and Buddy Media because we believe strongly in that. We need to find more marketing companies. Honestly there is more for us to do. There’s more demand but we need to innovate in this area. We are going to do some of that holistically and organically. We need to do some of that through acquisition. We want to be the company that you turn to in four key areas, in sales, in service, in marketing and as Adam correctly pointed out as well, in the platform. These are our four areas of focus and this is what our customers want to hear and how these four categories are the seminal interest for them in becoming this customer company.
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