"This will allow our customers to bring the heart of the social Web directly into their business," Benioff said in a Wednesday morning news conference. "We have seen it with our customers already, where they're receiving these feeds from Radian6, and they want to act on them right within our offering."
Salesforce said it would buy Radian6 for $276 million in cash and $50 million in stock, net of cash acquired, with the transaction expected to close in May. Radian6 provides a social media monitoring console, the Radian6 Dashboard, used by marketing managers to see what is being said about their brands across 150 million public websites, including social media sites, blogs, and discussion forums. The Radian6 Engagement Console allows customer service and support agents to respond to questions and criticisms of their employer across all those media.
Alex Dayon, executive vice president of customer relationship management (CRM) for Salesforce, said the Radian6 technology is valuable not just for its broad coverage, but for analysis to help sales and service professionals spot "the relevant inquiries about products and competitors and turn those into leads." While it's already possible to turn Radian6 alerts into Salesforce leads and service tickets by using application programming interfaces, the acquisition will allow a deeper level of technical integration, he said.
Given that Radian6 has more than half of the Fortune 100 as customers, including firms like Dell, GE, and UPS, Salesforce and Radian6 have already been working together on many key accounts, "and customers like Dell have been telling us we could make our products so much better by combining them," Benioff said.
Salesforce has been talking about all the ways social media changes CRM and building social media integration into products like Chatter (an activity stream angled toward sales leads) and its Service Cloud 3 customer service system. Salesforce had previously announced a partnership under which Radian6 would deliver a Radian6 for Salesforce.com product through the AppXchange marketplace later this year. That plan is still in place, but now Salesforce is talking about pervasive integration, making Radian6 technology an integral part of Chatter and a component of Force.com that independent software vendors will also be able to build into their products.
Benioff also suggested this acquisition could be "the beginning of the marketing cloud" -- that is, another major product line in parallel to the company's Sales Cloud and Service Cloud. He said the process of folding Radian6 technology into the Salesforce platform would probably follow a similar path to Salesforce's acquisition of Jigsaw last April, which also initially remained an AppXchange add-on, with native integration to follow in an upcoming release. "It takes about a one-year cycle to do the deep technical integration," he said.
The Radian6 tools for service and support agents will probably be integrated into the Service Cloud user interface, while the social media dashboard for marketers is likely to remain a separate product, according to George Hu, executive vice president for platform and marketing at Salesforce.