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9/1/2011
10:05 AM
Doug Henschen
Doug Henschen
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Salesforce.com's Social Enterprise Vision Will Cost You

Looking beyond CRM, the cloud-computing pioneer says it's crucial for companies to build a social-network-savvy enterprise. And, oh by the way, there's a license for that.

Who's Buying It?

Benioff backed up the vision with plenty of anecdotes about Salesforce.com customers that are making the Social Enterprise real. A video about NBC Universal showed how the company's diverse conglomeration of channels, networks and studios has managed to coordinate sales teams and unify media initiatives using the vendor's CRM and Chatter applications.

Bank Of American is using Twitter as a customer-help and information platform; comments and questions about the bank posted on Twitter are reviewed within a Salesforce-powered contact center, and the responses from agents are automatically channeled back to Twitter. Disney's theme park unit has tapped Salesforce.com's Heroku development team to create interactive trip-planning and photo-sharing applications that run on Facebook. It's also using Radian6 capabilities to monitor the volume and tenor of comments about specific theme park amenities and rides.

In live interviews during his keynote, Benioff talked to executives from luxury apparel brand Burberry and beverage manufacturer Coca-Cola. Burberry is in the early stages of building out an "end-to-end digital enterprise," according to CEO Angela Ahrendts. The idea is to deliver consistent interactions with the brand regardless of the type of device (smartphone, tablet, PC) or channel (contact center, Facebook, Twitter, and so on).

Burberry only recently partnered with Salesforce, so no actual deployment details could be reported, but the company is clearly sold on the vision. "You have to create a social enterprise," Ahrendts told Benioff. "If you don't, I don't know what your business model is within five years."

Coca-Cola was cited as an instigator and the first customer to sign Salesforce.com's new Social Enterprise License Agreement. The company has 25 million fans on Facebook, and it's hoping to connect the consumers it meets on social networks with its huge customer database.

With Chatter, Radian6, and other tools now sometimes blurring the lines between customers and Salesforce technology "users," Coca-Cola was pushing for an approach other than per-user, per-month terms.

The Enterprise Approach

Enterprise licensing is hardly new to software buyers, but it is new to a company that has long prided itself on transparency and simple, affordable terms (as detailed on its Web site ). It's a sign that Salesforce.com is growing up and evolving. Indeed, the company recently reported that in the last quarter it had some 60 deals exceeding seven figures.

Now that Salesforce has broad, C-level relationships that extend well beyond CRM, the company says the new Social Enterprise License Agreement will provide an all-you-can-use option that will "elevate the level of the conversation," according to George Hu, Salesforce.com's executive vice president of platform, marketing, and operations.

"Instead of discussing seven different product lines and worrying about how many people will use the service cloud and how many call center agents to license, this approach positions us more strategically and, frankly, let's customers buy more from us," Hu said. He added that Coca-Cola likely would not have signed on for as many services and capabilities in an a la carte approach.

Changes in licensing approaches by other technology providers (notably at VMware) have not been well received in recent months, so it wasn't surprising to see Hu peppered with questions and requests for more detail on the Social Enterprise License terms.

Hu swept aside suspicions, saying the new approach will be transparent and will add to, not replace, the old licensing options. "The terms will be spelled out, customers will see their usage levels, and there will be a truing up at the end of the licensing period," he said.

Reassurances aside, I'm guessing the new approach won't be published on the Web site because it sounds like it will be one-off and enterprise specific. Like traditional software license agreements, it will undoubtedly vary greatly by the volume of users and the depth of the technologies used.

No surprises there, but I've always associated the "no-software" company with no software-company-like terms. I'd also expect that the company will try to effectively monetize all the investments it's making in social enterprise technologies, including Chatter, Radian6, and other bits and pieces that aren't currently built into the same old per-user, per-month prices you've long paid for CRM. There's a reason Salesforce.com stock price popped more than 3% on Wednesday.

The bottom line is that Salesforce.com is a growing company and that's forcing changes. There are now a lot more moving parts behind the technology portfolio, and the company is clearly looking to add more. If you want Salesforce.com to help you build your firm into a social enterprise, you'll likely have to step up to the Social Enterprise Licensing Agreement.

In the new, all-digital issue of Network Computing: Microsoft and Citrix are closing the gap with VMware. Before you roll out the latest edition of vSphere, reconsider your virtualization platform. Download the issue now. (Free registration required.)

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