QUOTE AND NEWS
Forbes  10 hrs ago  Comment 
By Laura Fagan, Salesforce
TechCrunch  Aug 13  Comment 
 Customers of Salesforce’s Community Cloud will soon be able to add their own buy buttons. The Community Cloud allows businesses to build sites where customers can interact with the company and with each other. By introducing the ability to...
The Economic Times  Aug 12  Comment 
One major part of its strategy has been to hire more people from traditional enterprise companies, like Salesforce and VMware.
Forbes  Aug 11  Comment 
By Erin Sherbert, Salesforce In this hyperconnected world, we recently tried something a little different — we unplugged and had a good, ol’ fashioned conversation (the face-to-face kind, in some cases) with business leaders who have...
Forbes  Aug 11  Comment 
Global cloud computing behemoth Salesforce.com has been plagued by declining gross margins in the last few years. The gross margin of its cloud software business has contracted every year since 2011, falling from 87% in 2011 to 84% in 2014....
newratings.com  Aug 7  Comment 
REDMOND (dpa-AFX) - Data integration software provider Informatica Corp. announced the successful completion of its acquisition by a company controlled by the Permira funds and Canada Pension Plan Investment Board or CPPIB. Additionally...
New York Times  Aug 6  Comment 
The two companies, partners of the enterprise software maker, will take ownership stakes in the biggest leveraged buyout of the year.
Forbes  Aug 6  Comment 
If you are in technology, venture capital, or business in general; you're probably familiar with Maynard Webb. Maynard is the Chairman of the Board at Yahoo!, board member at Salesforce and Visa, former Chief Operating Officer at eBay,...
Market Intelligence Center  Aug 4  Comment 
For a hedged play on salesforce.com inc (CRM) MarketIntelligenceCenter.com’s algorithms selected the Oct. '15 $72.50 covered call for a net debit in the $67.69 area. That is also the break-even stock price for the covered call. This trade will...




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Salesforce.com provides enterprise cloud computing applications such as customer and collaboration relationship management (CRM) to businesses of various sizes and industries.[1] By providing subscription-based CRM applications to record, track, manage, and analyze data concerning sales, customer service and support, and marketing operations, Salesforce.com's CRM applications provide customers the ability to build these systems without investing in new software, hardware, and other infrastructure.[2] Salesforce.com's main products and services include CRM applications, the Force.com, AppExchange, and related consulting and maintenance services. Salesforce.com has over 92,000 customers worldwide and derives more than 30% of its revenue from overseas sales. While providing a potential less expensive platform, Salesforce.com faces heavy competition from large business customers who have greater resources and entrenched customer relationships with larger businesses.[3] As these businesses compete for cost conscience customers , profit margins continued to remain depressed.[4]


Business Growth

Through the acquisitions of InStranet in 2008 and Jigsaw in 2010, Salesforce.com has increased its offerings of software-as-a-service, or SaaS, and expanded into adjacent markets.[5] Salesforce.com has developed business applications beyond CRM applications that are designed to attract larger businesses as well.[6]

Trends and Forces

High-degree of competition threatens Salesforce.com's market share and profitability

With greater resources and established relationships with large business customers, large enterprise software companies like SAP and Oracle (ORCL) are a significant threat to Salesforce.com's ability to grow into new markets.[7] In addition, these companies have the ability to develop large research and development facilities, which put pressure on Salesforce.com to develop and market new products and services. In response, Salesforce.com has expanded its product lines through key acquisitions in 2008 and 2010.[8]


Salesforce.com's cloud-based platforms also face competition from cloud-computing rivals like Google (GOOG) and Microsoft (MSFT) as well as from open-source alternatives like SugarCRM.[9] These companies are market similar platforms to those marketed by Salesforce.com that have similar price-advantages that attracted small and medium-sized businesses to Salesforce.com.[10]


Salesforce.com declining 2011 profitability margins partially reflect increased competition in the CRM space as software providers compete for cost-sensitive contracts.[11] In addition, many of Salesforce.com's SaaS competitors have the potential of taking away clients and revenue from the Company.[12]

Salesforce.com needs growth to keep pace with high customer acquisition costs

Salesforce.com's marketing expenses represent almost half of the Company's revenue. While marketing expense represent one type of cost, it illustrates how critical scale is to the Company's profitability.[13] Compared to those of its competitors SAP AG (SAP) and Oracle (ORCL), Salesforce.com operating margins are below industry average.[14] With larger deals, Salesforce.com lowers its customer acquisition costs. In response, Salesforce.com has launched products designed to increase investment in the Company's services. Force.com and Chatter Cloud both represent newly-launched products designed to attract customers to a "suite" of Salesforce.com offerings.[15]

Competition

Within the CRM-space, Salesforce.com's competitors offer open-source, SaaS, and traditional software solutions.[16] Competition is high,which has led to relatively diminished margins for Salesforces.com. Its key competitors include:



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