Saturday, September 3rd, 2011 - OVUM

OVUM Comment: Carter Lusher, Research Fellow & Chief Analyst 

Salesforce.com drives a three prong “social” strategy: social customer profiles, employee social networks, and product social networks.

It is Ovum’s opinion that this was a smart decision as Ovum’s conversations with and surveys of CIOs around the world indicate that these are top-of-mind concerns.

However, Salesforce has smartly expanded the concept of “social” beyond customer-facing activities like marketing to include an employee social network and a product social network.

Finally, Saleforce is tying all three “socials” – customer, employee, product – together so that there is leverage between all three. This is a bold move and one that early adopter customers, whether enterprise or public sector, will embrace.

Equally bold was Salesforce.com’s commitment to HTML5 as its go-to technology for tablets and smart phones. While HTML5 is still an emerging standard and somewhat immature, this adoption should help increase the speed and agility of Salesforce’s mobile client development. A side effect could be that Salesforce’s HTML5 strategy along with Apple’s long standing commitment to HTML5 – and rejection of Adobe’s Flash – could accelerate the market adoption of HTML5 making Salesforce’s decision very smart.

A point that flew somewhat under the radar, but that could have major market ramifications, is Salesforce’s Social Enterprise Licensing Agreement. The old primary licensing was based on a per user model, which breaks very easily in an environment where a customer wants to give potentially every customer, employee, and product access to some Salesforce functionality. Again, Salesforce was smart to listen to its customers and devise a new licensing scheme. Not only does it eliminate the administrative nightmares of a user-based license, but it gives Salesforce the ability to be deployed “wall to wall” within a customer’s organization, which is especially relevant for the collaborative tool Chatter. Once the customers, employees and partners have some relationship with a Salesforce product there is then the opportunity to cross-sell other products increasing Salesforce’s penetration.

Ovum recommends that enterprise and public sector IT executives use these recent Salesforce announcements along with Ovum’s 2012 Super Themes as catalysts to review their near- and long-term IT strategies. Even if the decision is not to be an early adopter of these concepts, this strategy review exercise will give IT the opportunity to future proof their plans and be ready to discuss the options should their “C” suite executives want to know what IT strategies are for the social enterprise and mobility.

-ENDS-

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