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Workday’s public offering pops October 12, 2012

Posted by David Card in Uncategorized.
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After re-pricing its offering from $24-26, Workday raised over $635 million with a $28 IPO yesterday and has gone as high as $48 this morning. Clearly, Wall Street was hungry – make that “starving” – for a tech IPO, after souring on consumer social media disappointments like Facebook, Groupon, and Zynga.

Workday is certainly on-trend with several Enterprise 2.0 buzzwords, its PeopleSoft founders have a good track record, and it has some blue-chip customers like HP and Google. The company has a SaaS-based HR offering combining HR management, payroll, and financials. It is growing fast – first half sales doubled to $120 million – but it’s still a relatively small company going head-to-head with Oracle and SAP.

Apparently, investors and customers like its pure cloud approach. Workday has also aggressively embraced mobile usage, but it is a little light on some of the other big enterprise tech trends. Workday made a nod to the social enterprise with a Salesforce Chatter integration, but it builds most of its own analytics and business logic: its API strategy (as a platform or as a plug-in) is still pretty sketchy. Workday doesn’t seem to be zeroing in on social recruiting yet.

But, hey, it’s a high-growth tech play that isn’t trying to build a consumer business. B2B is the flavor of the month. Right, Shutterstock?

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Box integrates to differentiate October 10, 2012

Posted by David Card in Uncategorized.
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With its flashy CEO, Box probably generates more buzz than its size or importance in the social enterprise space merits. The company is certainly on-trend with its freemium, cloud-based, mobile, somewhat social, user-friendly entry point into enterprise collaboration. At its own event, Box is showing some more social features and an important embeddable interface strategy that could tighten its integration with other tools and potential enterprise partners.

This corner of the social enterprise is getting crowded. Differentiation will come from integration and from suites of customized products geared to different business functions and, eventually, vertical industries. Box has done well early on with integration options. It should start shifting some resources to zero in on the feature-suite approach.

Salesforce.com’s next billion-dollar business: marketing tech August 27, 2012

Posted by David Card in Uncategorized.
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On its earnings call, Salesforce.com showed 34 percent revenue growth and called marketing its next billion-dollar business. The most vocal proponent of the so-called “social enterprise,” Salesforce has made big bets on social media marketing technology with huge acquisitions (Radian6, Buddy Media). The company is well positioned, but it has a lot of work to do.

Salesforce’s Q2 revenue growth was solid, but at just over $730 million it is much smaller than that of its biggest enterprise software rivals. Oracle’s software business grew only 6 percent, but it’s already $8 billion, and Microsoft’s server, tools and business software sales topped $11 billion. Salesforce CEO Marc Benioff said on the call that its customer service product line has moved beyond a $500 million yearly run-rate on its way to $1 billion, and he expects that marketing technology would achieve that “not overnight, but not that long, either.”

Grand vision

Salesforce plans to integrate social marketing management with customer service and wrap the whole with social collaboration via its Chatter work media products. Benioff cited Burberry as a customer that had added Radian6 and was deploying Chatter.

The twin pillars of Salesforce’s marketing business are Radian6, a listening platform it acquired a year and a half ago for $326 million, and Buddy Media, its just-closed $689 million acquisition that makes management tools for social media advertising and marketing. But when giving full-year revenue guidance, CFO Graham Smith indicated Salesforce was expecting only $25 million in revenue from Buddy Media. A questioner on the call asked that, while Buddy Media managed 10 percent of the advertising that ran on Facebook, did Salesforce need any more assets in its marketing tech portfolio. Benioff responded that he’d already acquired the biggest players in social media marketing management – not so subtly taking digs at Oracle’s acquisitions in the space.

Slow execution?

Two weeks ago, Salesforce introduced “Communities,” which will enable companies to create private, Chatter-based social networks to collaborate with remote employees, customers, and their supply chain. But smaller competitors like Jive Software and Telligent are well ahead of Salesforce, especially since Salesforce’s product will only go into limited beta this year, with general availability scheduled for the second half of 2013. Salesforce trumpets its ability to combine a social networking platform with business process apps, but the specialists are already packaging up suites of functions for various types of marketing, collaboration, and integration with enterprise applications.

And Salesforce may be, if anything, too focused on social media. Another questioner asked if Saleforce was going to add lead-generation management to its portfolio. Benioff said that he thought lead generation and email marketing were not areas of spending growth. That may be true, but marketers I talk to, especially in retail, still value email marketing as a better conversion tool than social media. Benioff said Salesforce’s marketing dashboard could accommodate direct marketing, but that he might lean on Salesforce’s AppExchange marketplace for third-party tools.

Indeed, most companies have their own preferred email marketing platforms, and Salesforce probably doesn’t need to acquire what might end up as a competitive alternative. Salesforce is collecting the pieces for a full-fledged assault on marketing, but its next $1 billion may take a little longer than Benioff predicts.

 

Question of the week

What else should Salesforce add to its marketing tech portfolio?