Salesforce.com pins growth hopes on industries, wants to be bigger than SAP

Salesforce.com will focus on six industries, including automotive, health sciences and manufacturing

By , IDG News Service |  Software

Salesforce.com is betting that a push into industry-specific versions of its cloud-based software can help it maintain its breakneck pace of growth, and even usurp SAP as the industry's largest enterprise application vendor.

One way to meet the latter goal is by "speaking the language of industry," said Salesforce.com President and Vice Chairman Keith Block, during a company event in Boston Wednesday.

Block, who spent decades as a top sales executive for Oracle, knows a bit about selling software tuned for the needs of vertical markets. He left Oracle in 2012, after instant messages where he criticized Oracle co-President Mark Hurd surfaced as a result of a lawsuit Hewlett-Packard filed against Oracle.

Now Block, along with Salesforce.com Executive Vice President and former U.S. CIO Vivek Kundra, is planning to go after six verticals with a mix of organic investment, partnerships and, potentially, acquisitions.

The industries in question are financial services and insurance, health care and life sciences, retail and consumer products, communications and media, public sector and automotive/manufacturing.

Salesforce.com is also hiring executives with ample experience in each of these verticals, including Andy Baer, former CIO of Comcast Cable, who will head up the communications and media segment; and Shelley Bransten, an ex-Gap marking executive Salesforce.com has tapped to lead its retail and consumer products effort.

In each industry, Salesforce.com will mull over the relative benefits of building functionality itself, working with a partner or acquiring companies, and then choose a path accordingly, Block said.

To date, Salesforce.com has already made high-profile partnerships with the likes of Veeva, which built a CRM (customer relationship management) application aimed at life sciences companies on Salesforce.com's Force.com platform.

But for the most part, "Salesforce has pretty much gotten away without verticalizing, which is amazing on its own," said analyst Ray Wang, chairman and founder of Constellation Research.

At this stage of Salesforce.com's growth, "customers going forward are looking for vertical specific requirements," Wang added.

Expect Salesforce.com to focus more on services industries than areas such as manufacturing, as the former have more users and provide "a great way to drive upsell and cross-sell of products," he said.

Salesforce.com has been laying the groundwork of its vertical strategy for some months now, but Wednesday's event served as a formal announcement and an opportunity for Block to put SAP on notice.

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