I had the pleasure of meeting Marc Benioff, CEO of Salesforce last week at Exact Target’s Connections conference in Indianapolis.
Together with other analysts from Gartner and Forrester, we were given some untethered access to him as well as to Scott McCorkle, CEO of Exact Target Marketing Cloud and Alex Dayon, President, Products at Salesforce.
In private, Benioff the man is very different from the on stage persona many of us are familiar with – the exuberant showman, evangelizing the company he founded with the all the energy and enthusiasm of a gospel preacher.
Any of you who have ever attended his company’s annual Dreamforce event will know what I’m talking about.
Like the oft-repeated meme in HBO’s Silicon Valley, the audience is presented with the idea of a business that’s ‘making the world a better place’. Superlatives abound as the crowd applaud.
Brothers and sisters, I believe in the power of the cloud! One thing’s for sure, Benioff and his team know how to put on a show.
As with many dynamic and inspirational business leaders, the man behind the image is altogether more interesting. Softly spoken, considered and eloquent with a razor sharp wit, he appears every bit the corporate CEO that Wall Street demands.
With a 38% revenue growth on his company’s last quarter earnings you would think he’s delivering on their expectations.
At the same time, he has a laid-back Californian vibe, wearing no shoes, only socks at the fireside chat with will.i.am later that day. There’s a hint of the San Franciscan hippy about him almost. The beaded bracelet on his wrist a counterpoint to the pinstripe suit he’s wearing to our meeting.
He reminds me a little of the late Steve Jobs, a man with great intuition and a vision for the future of tech, combined with a sense of fun, yet someone who doesn’t suffer fools gladly.
We started by discussing some of the themes for his opening keynote address:
So, Marc, you talked about the Internet of Things, but you didn’t use that term – what do you see as Salesforce’s unique role in IoT going forward?
Benioff: Well I think that Salesforce’s unique role in IoT, or actually as we call it IoC - Internet of Customers, is that insofar as this Internet of Things represents customer-facing transactions, we want to have a role.
So it could be a Fitbit, it could be an automobile, it could even be a thermostat in your house – if it’s going to be connected to customer, whether that’s a consumer in b2c or a customer in a b2b environment, then we want to be part of the platform.
One of the cool things that we’ve done is to improve our API app even more and I think that’s very unique actually, that everything you saw today is available as an API. We need that because we have to build mobile apps on top of all these things and when we are out there selling to those customers, they are all looking at how they can get on the network and we want to help them do that.
Certainly, if you are servicing your product, you’re going to want your Internet of Things or your Internet of Customers or your Internet of Everything to connect to our Service Cloud. If you are selling you are going to want to connect it to the Sales Cloud. Also marketing, especially through Journey Builder is a huge opportunity for a lot of companies.
By the time we get to Dreamforce you’ll see how we wrap it all together with analytics.
So are you making a concerted run at this? Will this be a major initiative for Salesforce?
Benioff: Yes, but what you have to understand is that when you look at the volume of transactions, the numbers are unbelievable and so when we look at company like Honeywell and the fact that they are putting every one of their controllers on the network, this is going to be a lot of transactions.
This is not amateur hour. This is the real deal. And they have a huge vision, inspired by others, to build a new Honeywell – a connected Honeywell.
When they do that, they’ll need to build it on a platform and the volume of transactions that they need to be able to handle and the way that those transactions work is going to be a very significant undertaking. Scott – do you want to just talk about your vision around that for a bit?
McCorkle: Sure. So we have efforts to build massively scalable distributed processing. In most cases this is to decide whether an event needs to be ignored, because most of the data that’s coming from all these connected devices are not actionable.
Patterns are, though, so it’s not just about an individual event, but it could be a string of events – kind of like a first or second derivative of the rate of events maybe.
We have massive R&D efforts to create a ‘shock absorber’ for those events, so that what ends up getting passed for instance into Journey Builder is something that those front-end users think is important.
So is that ‘Complex Event Processing’ or do you guys have another name for it?
McCorkle: Yes that’s exact what it is. Alex, do you have anything you want to add to that?
Dayon: Well our vision is to combine that with the back-end processes. The majority of those events don’t have a real value. It’s not valuable that the thermostat tells you each and every second that the temperature of your house is 72 degrees.
What you really want to know is whether or not the house is too hot, or too cold, and that’s when you need to trigger something, so that the next step in your customer journey could be an email or it could be the dispatch of a service technician. That’s really where we see the synergy with our acquisition of Exact Target a year ago.
This complex event processing combined with CRM, we see as the complete platform for putting your objects, all your devices into your information systems.
Benioff: And apps are those things too, of course and customers are out there and they’re going to want to be controlling their devices from their app and I think for a lot of customers that’s an area where they struggle still.
The thing is they need to ready for that and for building and deploying these apps. We’re going to have some great new stuff coming out at Dreamforce around that as well.
Dayon: And the exciting thing for us as a management team is that the marketing world has shifted from managing the cookies with those apps to managing identities. This is because the first thing you do, for instance, when you buy a Fitbit, is that you create an account, so your login becomes your identity – your relationship with the brand.
That’s what we’ve seen with Uber, that’s what we’re seeing with Netflix. And as a consumer, I trade my identity for a better service from that brand. I think that’s what’s so exciting about the marketing world right now and that’s the massive disruption that’s happening.
Benioff: And that’s a great opportunity. If you build this flexible infrastructure, you can drop those apps on top of it and then your employees can push and pull and your customers can push and pull and it becomes this great thing. You can collaborate and you can share and you can communicate more effectively.
Of course not every company is ready for that level of transformation. Maybe there’s some fear or there’s some anxiety or there’s a lack of understanding of what can happen. Executives that are old-school, control oriented executives, whether they are IT executives or whoever, need to know that those barriers have already come down. You can try and hold on as long as you think you can hold on but, you know…
Looking at Ticketmaster and how it has evolved over the last ten years, that’s a great example, right?
Benioff: Sure, totally agree. They’re amazing.
Dayon: And when you look at those apps, there are four or five key patterns. The first one obviously is that those apps need to evolve very quickly, so you need a very agile development environment that allows you update them and to be able to map the analytics of the usage of that app. What are people using? How are they using it?
The second is commerce – that app needs to embark on some sort of transaction. The third one we see is communities – again Ticketmaster are a good example of that, Amazon is a good example too.
I think the one that really opened our mind was Apple, as they blended the shopping cart five years ago with the customer ranking and votes and now everybody is trying to do those things. The fourth pattern we see is service. So if you have an app, your help button should be there. Why would you have a different phone number for your customer service?
Benioff: Everybody needs a mayday button, not just Amazon.
Dayon: Yes - everyone needs a mayday button, we saw that example with Black and Decker case study where you have the app and some of the devices are connected and geo-located, so if you loose your piece of equipment you can find it, like with Apple’s ‘find my iPhone’. There is more, but these are the four big patterns that we see that are strong enough [incentives] for a customer to create an account. The big question for marketers today is ‘why would my customers create an identity that they share with my brand?’ and ‘what is the value and what is my brand giving them in exchange?’ Well if you bring a better experience with the service you are providing, then they will.
So as you are pulling all these capabilities into the cloud, does that bring any special responsibility on you?
In terms of developing new ways to secure or authenticate this information or anything like that, or do you see that as a problem for other experts?
Dayon: Well there are two parts to your question. In terms of identification, when you create an account in Salesforce, you can use a feature called Salesforce Identity and that allows you to use your Facebook ID.
The other question is about security of the data and that’s why companies are coming to us. There is no finish line when it comes to security, but the barriers to entry are very high and so when it comes to building a cloud service, a lot of companies just can’t afford that level of investment.
And a big part of this, I suppose is getting consumers to actually want to give up this type of information to brands and in effect vetting their personal data for you?
Benioff: Yes – and I think they do that more and more. You know my example is a real one. I recently bought the new iFitness treadmill. I have the app on here (lifts phone) and when you show up, the camera reads that and it creates the authentication.
I’ve already linked my iFitness account to my Fitbit account. So then we think, well, what are all the other things that are going to get linked together in the future? That integration is super interesting.
Q: So how quickly to you think that we’ll see that data set that you are creating eventually feeding into your doctor or primary healthcare physician, or perhaps even your health insurance company?
Benioff: Well today, we don’t really have that kind of integration, but that’s what we all want, right? Today I have to sit down with my doctor and I go through my data and she doesn’t even have to ask me to see it.
You know my scales are connected, my Fitbit is connected, my treadmill is connected - all these various things are connected now, and so that’s really neat.
Dayon: And coming back to the voice of the customer, what’s really important is how it’s changing the way that marketers are thinking. So when we look at the features that our customers are looking for, we look at things like the data on what people are using and then there’s also the community aspect where we have ideation capabilities and people can vote on what they’d like to see. It’s not just about usage data, though.
Q: It’s more about ideation and co-creation?
Dayon: Exactly and that’s the way we build a lot of capabilities. So when you do that over a period of 15 years, you end up really creating something that your customer wants and that gives you a competitive advantage so that’s why we productize
Q: And then you optimize it based on operational data?
Dayon: You need to have the two. You need both. You can’t just do it based on the analytical data, you have to look at sentiment and that real-life collaboration with your customers, because you are smarter when you work together as a group.
Benioff: It also becomes your brand – you show that you’re listening and that your customers can interact and that they can trust you. They will come to you and say ‘well did you act on this?’ because it’s not just enough to collect the data - you have to operationalize it and feed it back to them.
Dayon: And at Dreamforce when we present, we have those certain slides that we call the ‘clappies’ because when we show them we know that people are going to clap.
This is because we know from our community that these are the things that people are looking for and they are like ‘ah..you finally did it!’ - and that’s the voice of the customer actually.
Marc, you spoke earlier about big goals for the business, can I ask you about advertising for a second? Your announcement about the deal with Omnicom has a lot of people talking.
What is the role for Salesforce in the use of first party data for targeting? Is there a role for the business in the DMP/DSP space perhaps?
Benioff: Well today, Social.com, which is the ad buying service that we have, is a significant part of the network. As you probably know, it represents about 10% of Facebook’s ad spend every month.
We want to make that a part of the journey, so that you know where your customer is, you know what they are looking for and if you want to target them more aggressively, well here’s how you do it. It does however need to be part of the bigger picture.
We don’t just want to be only an adsales business, you know, that’s not really who we are anyway. Who we really are is a company that’s about managing the customer relationships. You could say that we’ve sort of come to this through the ‘left side’ a bit. Scott to you want to speak to that?
McCorkle: Sure. So we like the social aspect – the fact that it’s a person and not just a cookie, but in general the interest in how we think about our product roadmap is that it’s inclusive of all advertising spend.
Coming back to the idea we were talking about earlier around spaces – as beacons start to pop up in our world, space is going to become monetizable as an ad unit. Someone can be in a place that that place will be connected to a mobile app and you’ll be monetizing that in ad networks.
So we really like what we have with our Social.com offering. For us ‘connectedness’ to the journey is paramount. The whole idea of what it means to deliver an ad is something that we spend a lot of time thinking about.
Q: Well, in-app advertising can be highly targetable, right?
McCorkle: Absolutely, it sure can.
Dayon: And that’s where the synergy with Omnicom digital is so exciting, because they have this massive infrastructure to find the right content for the right person at the right time but to make that infrastructure smarter they need that CRM data.
They need to know more about the customer – where they are, who are they and what are they doing and that’s what we can provide with the Exact Target Marketing Cloud, so the two combined is all about where advertising is going now which is all about the this one-to-one relationship with the customer.
Benioff: And so when we get to Dreamforce, you will see a broad unveiling of the next generation of our platform. As we continue our product development and you will see everything mobile, everything social, everything in the cloud.
Q: Well it seems that that’s all we have time for. Thank you and good luck with the rest of the conference
Benioff, McCorkle, Dayon: Thanks everyone.