Marc Benioff's enterprise ambitions (first look at Salesforce Chatter)

Marc Benioff, CEO of Salesforce.com, has big ambitions for the enterprise. He no longer wants Saleforce to be seen as a service just for salespeople. He’s going after the whole pie. Today he is releasing a new social service that looks sort of like Facebook for the Enterprise, called Chatter. Here’s a video first look at the latest beta.

He just might get it.

First, what pie is he going after? Microsoft’s Sharepoint. Now, he’s not alone in those ambitions. Jive, Box.net, Zoho, SocialText and other companies have the same ambitions. The problem is they don’t have a big stick to get into the CTO’s office. Salesforce already has a relationship with almost every company’s CTO. The other players have had some good wins, but they won’t be able to make an entire marketplace pay attention the way Benioff can.

When I interviewed Benioff I compared him to Steve Jobs. He didn’t like that comparision, but the comparison is apt. No one is positioned to become the Steve Jobs of the Enterprise the way that Benioff is.

OK, today Salesforce has firmed up the position in the enterprise as THE service for salespeople. It’s how salespeople track their contacts, sales pipelines, and much more. But here’s the rub: Salesforce is releasing a version of Chatter (which is really a copy of Facebook) for the entire enterprise. How will Salesforce convince the non salespeople to use it?

A few ways.

1. Pricing. Chatter will be free to non-salespeople. So, they will be able to join in without getting approval to buy something new. Other players like Jive and Socialtext don’t have their feet into enterprises yet (at least not most of them) and they don’t have the ability to offer a version of their product for free the way Salesforce does.
2. Salespeople now will badger coworkers, like our friends badgered us to join Facebook. Salesforce already has a strong position in most enterprises with salespeople. Those salespeople will now badger their coworkers to join in. How will they do this? “Hey, John, can you join in this Chatter thing because we are pitching XYZ company next week and we need your engineering input.” Other companies don’t have a built in badgering force the way Salesforce does.
3. Integration into already existing enterprise systems. In the demo I filmed you’ll see that Chatter isn’t really just a copy of Facebook in that it allows developers to integrate already existing enterprise databases and systems like SAP to shove information into Chatter’s feed. This is very powerful and will cause enterprises to adopt it wholly, while other systems will have troubles.
4. Salesforce is positioned to take advantage of a continuing anti-Microsoft force (and the continuing charge into Web services). When I speak at conferences you can see this anti-Microsoft force. How much marketshare has IE lost to other browsers? Do you use Microsoft Word anymore? Have you tried to find ways to reduce your reliance on Microsoft? Many have and you can see this force. Salesforce led the charge when it came on the scene 11 years ago with its “no software” chant. If you buy Sharepoint, for instance, you have to load that software. Someone has to setup a server and keep it running and update it when Microsoft inevitably comes out with updates. Plus, Microsoft is behind in its adoption of Facebook-like gestures. I know workplaces that have already adopted things like Jive or Yammer because they are far better than Microsoft in bringing social gestures to the workforce. Who is better positioned to take over than Salesforce? You might say Google, but, sorry, Google Buzz just isn’t even close to the enterprise trust and thinking that Salesforce has. So, I see two choices: stick with Sharepoint (Rackspace, my employer, is helping make that choice more palpable through its hosting of Sharepoint) or go with Salesforce. Which one will your company choose?
5. This sticks another nail into Lotus Notes. Enough said.

Anyway, it might seem weird for a Rackspace guy to be helping out Salesforce, which is really now a competitor to Rackspace’s enterprise efforts. But great companies aren’t built by companies ignoring their competitors. They are built by being honest about the marketplace and Benioff has big ambitions that’s gotten our attention.

Has he gotten yours? Can anyone stop Benioff? Here, listen to Benioff in his own words describe his ambition for the enterprise in an interview I did a couple of weeks ago.

Comments

  1. The key is your point about access to the CTO. Salesforce doesn't need to sell Enterprise 2.0 or Social Business which is not a CIO budget line item today. This seamlessly fits in by extending the customer relationship use case. On the other hand, this will co exist with Sharepoint, just as Salesforce did w/ Siebel and other on premise CRM systems. And in some cases, slowly move to become the collaboration system of record.

    As I wrote early (http://ow.ly/18k5Q) , I do wish they pushed enterprises to think about customer centricity where Chatter can play a significant role.

    p.s. How stoked is Starbucks? :)

  2. This is a great idea. When I was a newspaper distribution manager I used SAP but also the management team worked around a 24/7 system I worked 6pm-2am but we needed to connect with each other to get things done in a correct manner and also to understand a situation that was inherited from the previous shift manager. The top boss only worked 9-5 but we also needed his decisions from time to time but of course he was not available. This system would of been an incredible advance and saved so many hassles and problems, especially the mobile version…Great idea and surely a winner!

  3. Sorry. I don't think you can place Steve Jobs and Benioff in the same sentence. You might instead want to compare him to Larry Ellison.

    Salesforce hasn't really innovated at all. They've manage to insert themselves into the Fortune 500 landscape quite capably I might add, a tribute to Benioff's salesmanship and connections, but they are a far cry from the hearts and minds of the general consumer and small businesses.. Highrise of 37 Signals has capitalized on this fact.

    Just glancing at their millions of features, complicated licensing and payment policies and the Windows 95 look and feel of their website it's obvious that they're selling the same old tired enterprise-y software that Oracle and MSFT have been selling for years. They're just dressing it differently.

  4. I seldom find myself in the position of defending SharePoint, but the numbers speak volumes about Microsoft's success in the enterprise. SharePoint “broke the $1 billion revenue mark last year and continued to rise past that total this year.” (NYT, http://nyti.ms/3JQCH3) The SharePoint team is busy this year in launch mode for its SharePoint 2010. Those numbers don't even reflect this upgrade.

    SfDC broke a billion too in 2009 in TOTAL company revenues for its 4 lines of business. http://tcrn.ch/9GX47R

    The largest deployments we're tracking in The 2.0 Adoption Council continue to be SharePoint (and IBM Lotus Connections, btw) customers. And, don't count out Jive either. Jive is growing quite nicely in the large enterprise. I'm thrilled Benioff is bringing his voice and attention to the 2.0 space, but all eyes are on those integration opportunities with back-end business processes, including every enterprise vendor under the sun. It will be a crowded, competitive space for a while. Very much looking forward to SfDC in this mix, but important to put it in perspective.

  5. The IT shops I consult for all Linux based and many of them are still stuck running Sharepoint & Exchange and have it on their roadmap to upgrade this coming year.

    However – they all hate it. They do it because IT is a service to the business and the business understands and is familiar with Exchange, Sharepoint & MS in general.

    Salesforce is driving change in corporations where it can really begin – in the profit generating sector (sales).

    Getting off of Exchange or Sharepoint is something most CIO's simply can't do because their CEO doesn't feel comfortable with open source alternatives.

    But if Chatter is 1/2 as usable and useful as their core CRM product this is going to be a huge threat to Sharepoint.

  6. Super cool post, Robert!
    I am so happy to see that finally is collaboration considered as true factor which can enhance performance at work.
    As many bosses still ban their employees to use social networks at work, forgetting that they can do actual work with its help, when they use it wisely and know how to connect to others…
    Having platform like Chatter is blessing for all of us, who experienced what power and synergies collaboration can create.
    ;-)
    cheers from Slovakia, where having a company email ID is considered as peak of IT department gift to their employees…
    ;-)
    i.

  7. Been wondering when this opportunity would be capitalized on. I heard Marc mention that you learn so much information about strangers with social media, but I wonder if he's missing the point of new media channels, to connect with people in new ways. They're not so much strangers, as friends I haven't met in person yet.

  8. Reminded me a bit of Sony's “placement” ploys in “Last Action Hero” … and now that they only brew the cost-cutter heart-burn special PP, it was a disappointment. Benioff is always a great interview. I could not believe SF is only 11 years old.

  9. Robert – this is a great article about a very cool solution, and I respect your writing greatly, but your line “5. This sticks another nail into Lotus Notes. Enough said.” is just silly here. Why?

    1. You provide no context or validation to the statement.
    2. Have you ever used Notes? Looked at any of the stuff going on, like integration with Gist, Tungle, LinkedIn, and others? Looked at the numerous open source solutions coming as Notes plug-ins like Wildfire? http://www.matnewman.com/webs/personal/matblog….
    3. The power of Notes is that it integrates with stuff like Salesforce, and so many other things out there.

    Please, stop making generalizations about the Notes market if your not knee deep into it. I spend my time in the Lotus, Microsoft, and open source world- and there is plenty of room for all three. And all three are having successes and losses.

    As much as I hear people talk about this anti-MS kick, I am hearing an anti-Google sentiment as well. I hear it about Apple as well – app store lock in and still too high of priced hardware. The reality is people who go to tech conferences need something to bitch about :-) Sharepoint is a billion dollar brand – and is continuing to grow. Great to see folks like Salesforce push everyone else to build better solutions.

  10. Microsoft has a great enterprise monopoly and distribution advantage who is reason for the adoption they have at the large enterprise segment. However, the world is changing and there are certain trends like cloud computing, growing adoption of advance IT at the small medium business segment. I believe that is a great opportunity for emerging companies and startups.

    The premise that Marc spoken about regarding why enterprise social could not be more social like facebook is exactly the reason why I started my company Socialwok -a business social networking service for Google Apps. Our users use Google Apps account to login into Socialwok, share messages, files and existing Google Docs/Calendar from Gmail. (http://socialwok.com/tour_gapps)

    I believe Salesforce chatter is quite disruptive – connecting business applications + social feeds as it brings together salesforce trapped data and connects that to a social process. There are also other interesting platforms where business data is trapped like Google Apps.

    Google Buzz also brings an interesting dimension. At Socialwok, we are vey excited about Buzz. It extends Socialwok’s capabilities even more. Big announcements coming from us on feed based sharing on the enterprise + buzz Keep updated from our blog http://blog.socialwok.com

    Ming

    Disclosure: I am CEO of Socialwok (http://socialwok.com/tour), Business Social Networking for Google Apps. We provide to businesses in general in particular Google Apps users the ability to do microblogging, collaboration using feeds.

  11. Hi Robert — we have over 2 million enterprise seats deployed for NewsGator SocialSites — in SharePoint environments. we're running hard to keep up with the appetite orgs/I.T. have for Social SharePoint. SP at over 105 mill seats ww now — multiples of SF.com. Good to see Benioff jump onto the bandwagon.