Is Salesforce a cloud platform or an CRM application?

Forbes blogger, Louis Columbus, offers a quite flattering view of Salesforce’s transformation from CRM provider to a big league cloud player.

Here’s the punch line:

Enabling developers to attain greater revenue growth, while creating an extensive mobile app development platform is further proof Salesforce has turned the corner from being an application company to a platform provider.

via Forbes

The core of the argument revolves around the growth and strength of the developer community at Dreamforce this year driven by their cloud capabilities and mobile development platform.

Follow the Money

While it’s no doubt true that Salesforce has both acquired and developed some really cool cloud technology, the litmus test of business leadership needs to be more than having cool toys.

You also need to make money from them.

Here’s an excerpt from Salesforce’s last quarterly statement:

We derive substantially all of our revenue from subscriptions to our CRM enterprise cloud computing application service, and we expect this will continue for the foreseeable future. The markets for our Marketing Cloud and Salesforce Platform remain relatively new and it is uncertain whether our efforts will ever result in significant revenue for us.

via Salesforce 10-Q, 31 July 2013, p 63

Basically, Salesforce might have some cool cloud technology but they are not making significant money from anything other than their core CRM offering.

For now, they are still more of an application provider than a cloud platform leader.

1 comment for “Is Salesforce a cloud platform or an CRM application?

  1. October 9, 2013 at 6:01 pm

    Absolutely spot on.

Leave a Reply

Your email address will not be published. Required fields are marked *