Competitors like SAP and Oracle used to scoff at the business model of Salesforce.com with its software as a service delivered in the cloud. Now they are emulating Salesforce’s model and they, along with Microsoft, are trying to apply more competitive pressure on the cloud enterprise application company.
Salesforce upped its game Aug. 14 with the introduction of Salesforce Communities, which is built on its Chatter enterprise social media platform and is designed to better integrate social media with a company’s actual business processes.
The launch of Salesforce Communities comes in the wake of a San Francisco Chronicle profile of the company and its outspoken CEO Marc Benioff titled “Big competitors push Salesforce to evolve.” The article notes the ascension of Oracle, SAP and Microsoft-the latter with its acquisition of Yammer-as formidable competitors in enterprise social media to the pioneering Salesforce. Oracle and SAP have also made acquisitions in the last 12 months to bolster their enterprise social media offerings.
Salesforce Communities will combine social networking features such as profiles, real-time feeds, trending topics and recommendations with the cloud-delivered business information and process applications from Salesforce.
“What we’re really focused on is building communities, not colonies,” said Doug Bewsher, senior vice president of marketing for Chatter. “What [competitors] are really doing is building colonies, which are disconnected from their core business processes.”
Bewsher characterized competitors’ “colonies” as social media-like groups for customers, employees, partners or suppliers. While those colonies may share information with each other and the company, and vice-versa, they lack a connection to business processes to actually get things done.
In a demonstration of Communities, Dave King, a senior director of marketing for Chatter, presented a mock-up of a Hewlett-Packard support site where a small-business customer reported that 10 of its HP laptops suffered water damage and wanted to know if the damage was covered under warranty and how they could be replaced. In the demo, the business owner was connected to someone from HP customer support and to a reseller nearby who could deliver the replacement laptops.
“It’s got all the social elements,” King explained. “But I think the most important thing is that you can collaborate around real business data.”
GE Capital is doing a pilot of Salesforce Communities and has already created 50 communities within its enterprise. Communities will become generally available in mid-2013, King said.
But one of Salesforce’s competitors quickly responded with an upgrade of its own. Yammer, also on Aug. 14, introduced its first major upgrade since its $1.2 billion acquisition by Microsoft in June. According to a Yammer blog post, the upgrade provides a fresher look to the service, improves navigation and adds some new features. The upgrade is intended to “make it easier to discover relevant people, content and conversations,” the post states, which is largely the point of enterprise social media platforms.
Meanwhile, Oracle has been building out its enterprise social media platform with several recent acquisitions such as Vitrue in May, Collective Intellect in June and Involver in July.
SAP’s latest acquisitions included Ariba for $4.3 billion in May. While not strictly enterprise social media, Ariba is a provider of a cloud-based buyer-seller collaboration platform for procurement that has social media elements to it. Also in May, SAP announced the addition of social media capabilities to its SuccessFactors cloud-based suite of business services software to manage human resources, payroll, finance and expense management.
But Salesforce is not going to let those competitors beat them at their own game. It built up its own enterprise social media bench with the acquisition of Buddy Media in June for close to $700 million. Buddy Media’s specialty is social media in the service of marketing campaigns.