I spent the early part of this week at Salesforce.com’s annual Dreamforce conference. Here are my observations.
The big news was for geeks. The main theme of the conference was Salesforce1, a new set of technologies that make it vastly easier to deliver and integrate mobile versions of Salesforce-based applications. It is apparently a major technical accomplishment and at least one of my technical friends was hugely impressed. But I can’t say I personally found it all that exciting. Perhaps we’ve reached the point where we expect technology to do pretty much everything, so the line between what's already available and what's new is only visible to experts. Any way you slice it, focusing on platform technology is much less exciting than last year's vision of "social enterprise".
The bad news was for B2B marketing automation. Conference presentations confirmed that Pardot, the B2B marketing automation system that Salesforce acquired as part of its ExactTarget acquisition, has been separated from the rest of ExactTarget and made part of the Sales cloud. There, Pardot is described only as providing lead scoring and nurture programs, which ignores landing pages, behavior tracking, and other features that B2B marketing automation usually provides (and Pardot includes). In terms of infrastructure, Pardot will eventually work directly from the CRM data objects, rather than maintaining its own synchronized database. (Data outside the CRM structure, such as detailed Web behaviors, will remain separate.)
What this means is that Salesforce sees B2B marketing automation as just an appendage of sales automation. This is pretty much the same constricted view of marketing automation that Salesforce management has held all along. The logical consequence is to make lead scoring and nurture campaigns standard features within the Sales offering and discard Pardot as a separate product. I should stress that no one at Salesforce said this was their plan, but it seems inevitable. If and when that does happen, only the most demanding companies will purchase a separate B2B marketing automation product.
To put a more optimistic spin on the same news: Salesforce will continue to let independent B2B marketing automation apps synch with Sales. If Salesforce does merge Pardot features into its core Sales product, then marketers who have a more expansive view of B2B marketing automation functions (or who simply want a system of their own) will be forced to buy from someone else.
The interesting news was that B2C marketing automation remains separate. Salesforce’s list of business groups includes the Sales Cloud, Service Cloud, and ExactTarget Marketing Cloud. Did you notice that just one of these has its own brand? As this suggests, and conference presentations confirm, Salesforce has kept B2C marketing distinct from its Sales and Service businesses, most importantly at the data and platform levels. The ExactTarget Marketing Cloud does now include Salesforce’s previously-purchased social marketing components, Radian6 social monitoring and Social.com social advertising. It also includes the iGoDigital predictive personalization technology that came along with the ExactTarget acquisition.
Salesforce did announce some plans to integrate the Marketing cloud with Sales and Service, but they are pretty much arm’s length: Marketing can receive alerts about changes in Sales (and I assume Service) data, even though that data remains separate; Sales and Service can send emails through the ExactTarget engine; Sales and Service can receive content recommendations from the Marketing predictive modeling tool. As near as I can tell, this is the same type of API-level integration available with any third-party system. For what it’s worth, the ExactTarget Marketing Cloud APIs are also part of Salesforce1, but don’t confuse that with sharing the same underlying platform.They don't.
The good news is the B2C marketing vision. It’s not really surprising that Salesforce kept its B2C platform separate, since Salesforce's core technology isn’t engineered for the massive data volumes and analytical processing needed for B2C in general and consumer Web marketing in particular. Happily, this technical necessity is accompanied by what strikes me as a sound vision for customer management. ExactTarget framed this around three goals: single view of the customer; managing the customer journey; and personalized content across all channels and devices. It described major features for each of these: a unified metadata layer to access (and optionally import) data from all sources; a “customer journey” engine to manage multi-step, branching flows; and predictive modeling to select the best offers and contents across email and Web messages.
This felt like a more coherent approach than Salesforce described for the Sales cloud, where external data and predictive modeling in particular were barely mentioned (or, more precisely, are still being left to App Exchange partners). The ExactTarget cloud still lacks tools to associate customer identities across email, phone, postal, social, and other systems, although there are plenty of partners to provide them. I didn’t get a close look at the details of the ExactTarget functions, which will really determine how well it competes with other customer management platforms. But the general approach makes sense.
News of the revolution may be exaggerated. Salesforce argued during the AppExchange Partner keynote that the AppExchange and Salesforce platform have created a “golden age of enterprise apps” by enabling small software developers to sell to big enterprises. One part of the argument is that the platform itself lets small vendors break through the credibility and scalability barriers that have historically protected large enterprise software vendors. The other is that end-users can purchase and deploy apps without involving the traditional gatekeepers in enterprise IT departments. A corollary to this is that end-users have different priorities than IT buyers – in particular, end users care more about ease of use – so successful software will be different.
Of course, this is exactly what the AppExchange partners wanted to hear and exactly the strategy behind Salesforce’s platform approach in the first place. But that doesn’t necessarily make it untrue: and, if correct, it would indeed be a revolution in the enterprise software industry.
But some revolutions are bigger than others. Even in an app-based world, individual users won't be making personal decisions about how to run core business processes. Rather, systems will be chosen at the department level because companies can more or less safely assume that whatever the department chooses will integrate smoothly with the corporate backbone. That's certainly a change but bear in mind that departmental buyers will have the same preference as corporate IT groups for working with the smallest possible number of vendors. This means there will still be the familiar tendency for individual vendors to add more functions over time. So industry dynamics may change less than you’d expect.
The big news was for geeks. The main theme of the conference was Salesforce1, a new set of technologies that make it vastly easier to deliver and integrate mobile versions of Salesforce-based applications. It is apparently a major technical accomplishment and at least one of my technical friends was hugely impressed. But I can’t say I personally found it all that exciting. Perhaps we’ve reached the point where we expect technology to do pretty much everything, so the line between what's already available and what's new is only visible to experts. Any way you slice it, focusing on platform technology is much less exciting than last year's vision of "social enterprise".
The bad news was for B2B marketing automation. Conference presentations confirmed that Pardot, the B2B marketing automation system that Salesforce acquired as part of its ExactTarget acquisition, has been separated from the rest of ExactTarget and made part of the Sales cloud. There, Pardot is described only as providing lead scoring and nurture programs, which ignores landing pages, behavior tracking, and other features that B2B marketing automation usually provides (and Pardot includes). In terms of infrastructure, Pardot will eventually work directly from the CRM data objects, rather than maintaining its own synchronized database. (Data outside the CRM structure, such as detailed Web behaviors, will remain separate.)
What this means is that Salesforce sees B2B marketing automation as just an appendage of sales automation. This is pretty much the same constricted view of marketing automation that Salesforce management has held all along. The logical consequence is to make lead scoring and nurture campaigns standard features within the Sales offering and discard Pardot as a separate product. I should stress that no one at Salesforce said this was their plan, but it seems inevitable. If and when that does happen, only the most demanding companies will purchase a separate B2B marketing automation product.
To put a more optimistic spin on the same news: Salesforce will continue to let independent B2B marketing automation apps synch with Sales. If Salesforce does merge Pardot features into its core Sales product, then marketers who have a more expansive view of B2B marketing automation functions (or who simply want a system of their own) will be forced to buy from someone else.
The interesting news was that B2C marketing automation remains separate. Salesforce’s list of business groups includes the Sales Cloud, Service Cloud, and ExactTarget Marketing Cloud. Did you notice that just one of these has its own brand? As this suggests, and conference presentations confirm, Salesforce has kept B2C marketing distinct from its Sales and Service businesses, most importantly at the data and platform levels. The ExactTarget Marketing Cloud does now include Salesforce’s previously-purchased social marketing components, Radian6 social monitoring and Social.com social advertising. It also includes the iGoDigital predictive personalization technology that came along with the ExactTarget acquisition.
Salesforce did announce some plans to integrate the Marketing cloud with Sales and Service, but they are pretty much arm’s length: Marketing can receive alerts about changes in Sales (and I assume Service) data, even though that data remains separate; Sales and Service can send emails through the ExactTarget engine; Sales and Service can receive content recommendations from the Marketing predictive modeling tool. As near as I can tell, this is the same type of API-level integration available with any third-party system. For what it’s worth, the ExactTarget Marketing Cloud APIs are also part of Salesforce1, but don’t confuse that with sharing the same underlying platform.They don't.
The good news is the B2C marketing vision. It’s not really surprising that Salesforce kept its B2C platform separate, since Salesforce's core technology isn’t engineered for the massive data volumes and analytical processing needed for B2C in general and consumer Web marketing in particular. Happily, this technical necessity is accompanied by what strikes me as a sound vision for customer management. ExactTarget framed this around three goals: single view of the customer; managing the customer journey; and personalized content across all channels and devices. It described major features for each of these: a unified metadata layer to access (and optionally import) data from all sources; a “customer journey” engine to manage multi-step, branching flows; and predictive modeling to select the best offers and contents across email and Web messages.
This felt like a more coherent approach than Salesforce described for the Sales cloud, where external data and predictive modeling in particular were barely mentioned (or, more precisely, are still being left to App Exchange partners). The ExactTarget cloud still lacks tools to associate customer identities across email, phone, postal, social, and other systems, although there are plenty of partners to provide them. I didn’t get a close look at the details of the ExactTarget functions, which will really determine how well it competes with other customer management platforms. But the general approach makes sense.
News of the revolution may be exaggerated. Salesforce argued during the AppExchange Partner keynote that the AppExchange and Salesforce platform have created a “golden age of enterprise apps” by enabling small software developers to sell to big enterprises. One part of the argument is that the platform itself lets small vendors break through the credibility and scalability barriers that have historically protected large enterprise software vendors. The other is that end-users can purchase and deploy apps without involving the traditional gatekeepers in enterprise IT departments. A corollary to this is that end-users have different priorities than IT buyers – in particular, end users care more about ease of use – so successful software will be different.
Of course, this is exactly what the AppExchange partners wanted to hear and exactly the strategy behind Salesforce’s platform approach in the first place. But that doesn’t necessarily make it untrue: and, if correct, it would indeed be a revolution in the enterprise software industry.
But some revolutions are bigger than others. Even in an app-based world, individual users won't be making personal decisions about how to run core business processes. Rather, systems will be chosen at the department level because companies can more or less safely assume that whatever the department chooses will integrate smoothly with the corporate backbone. That's certainly a change but bear in mind that departmental buyers will have the same preference as corporate IT groups for working with the smallest possible number of vendors. This means there will still be the familiar tendency for individual vendors to add more functions over time. So industry dynamics may change less than you’d expect.
