How does Salesforce make money?

Steven Loeb · October 25, 2014 · Short URL: https://vator.tv/n/39f1

Salesforce offers subcription services, including Sales Cloud, Service Cloud and Marketing Cloud

Salesforce is a company whose name is bandied about a lot, but I wonder how many people outside of the business world have any idea what the company actually does. I'll admit that before I started writing about tech I had no idea myself!

So, in case you don't know, it's a customer relationship management (CRM) company, which means it sells products that allow businesses to manage relationships, as well the data and information associated with them. Though the company has started to develop products, including an enterprise social network called Chatter, CRM still remains its core business.

And it makes the vast majority of its money by selling subscriptions to those products and services.

In its most recent quarterly earnings report, Salesforce saw revenue of $1.32 billion. And, of that, more than $1.2 billion came from what it calls, "Subscription and support."

That breaks down to four main products:

  • Sales Cloud

Sales Cloud helps businesses manage their sales cycle by allowing them to capture leads, maintain their customers information, contact management, and to get a complete view of their customers, including activity history, key contacts, customer communications, and internal account discussions.

Sales Cloud starts at $25 per month per user, and includes basic sales and marketing for up to 5 users, and goes up to $250 per month per user with unlimited CRM power and support.

The company made $610.1 million from Sales Cloud in the most recent quarter.

  • Service Cloud 

Service Cloud is a social customer service application, a fully customizable help and support dsk. It includes features such as case management, auto-suggested solutions, e-mail integration, call scripting, online training,  data storage and multichannel support.

Service Cloud pricing starts at $30 per month per user for Desk.com, and goes up to $260 per user per month, for unlimited customs app and customizations,  unlimited training and additional data storage.

Salesforce made $318.7 million from this product  last quarter.

  • Salesforce1 Platform

Salesforce1 is a cloud application development platform. Customers get access to Chatter, real-time APIs, Salesforce Identity, and point and click development.

Pricing  starts at $25 per user per month, which comes with access to 10 custom objects per user, and goes up to $150 per user per month, which comes with access to 2,000 custom objects per user.

Salesforces made $181.4 million from this product.

  • ExactTarget Marketing Cloud 

Salesforce bought cloud marketing platform ExactTarget in June of 2013. It offers e-mail marketing, social media marketing, Web personalization, predictive intelligence and a customer data platform.

ExactTarget brought in $122.4 million for Salesforce last quarter.

The other way that Salesforces brings in revenue is through "Professional services and other," which accounted for just $85.9 million.

Those services include consulting services, expert services and program architects. The company does not include any set pricing for these services.

(Image source: diginomica.com)

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Salesforce.com is the worldwide leader in on-demand customer relationship management (CRM) services. More companies trust their vital customer and sales data to salesforce.com than any other on-demand CRM company in the world.
Salesforce.com was founded in 1999 by former Oracle executive Marc Benioff, who pioneered the concept of delivering enterprise applications via a simple Web site. Salesforce.com is constantly building on that legacy by improving and expanding our award-winning suite of on-demand applications, our Force.com platform for extending Salesforce, and our one-of-a-kind AppExchange directory of on-demand applications.

Salesforce.com has received considerable recognition in the industry, including:
• Technology of the Year (InfoWorld, 2004, 2005, 2006)
• Editors' Choice Award (PC Magazine, 2002, 2003, 2004)
• Visionary Award (SDForum, 2004)
• Best of the Web (Forbes, 2003)
• CRM Excellence Award (Customer Inter@ction Solutions, 2003, 2004, 2005, 2006)
• Top 100 Innovators Award (BusinessWeek, 2006)
• Innovation Award (AMR Research, 2005)
• CODIE Award for Best CRM (2002, 2003, 2004, 2005, 2006)