"We feel pretty good about our ability to compete against Oracle CRM and the Siebel business unit. We, of course, follow SAP and Microsoft very closely. We just don't see the traction and the adoption or the customer base. Maybe one day we will, but I think that if they got as much code as they had rhetoric, they could actually maybe be doing something out there."
Marc Benioff, CEO of Salesforce.com, is on typically ebullient form, fuelled by the return to the black in the second quarter of the SaaS market leader. For the quarter ended July 31, the company earned $3.7m (£1.86m), up from a loss of $145,000 (£73,066) in the same period last year with revenue up $176.6m (£89m) from $118.1m (£59.5m).
During the quarter, the firm passed the 800,000-subscriber mark. “After taking roughly seven years to achieve our first 400,000 subscribers, we have more than doubled that total in the past six quarters,” said Benioff. “Not only are we adding record customer numbers in all areas of our business, but our customers are getting larger, too. A year ago, our largest customer had roughly 7,500 subscribers.
"Today, our installed base includes two customers with more than 30,000 subscribers, four customers with 20,000 or more subscribers and five customers over 10,000 and a remarkable 68 customers with more than 1,000 subscribers. That last number represents an increase of more than 40% over the number of customers with 1,000 or more subscribers that we reported just six months ago. Nothing says more about enterprise adoption than this explosive growth."
Benioff cites the approval of analyst firms as evidence of Salesforce.com’s status as a serious competitor to established enterprise players. In particular he points to a recent Magic Quadrant from Gartner Group which say Salesforce.com in the top right hand above Siebel.
"When I saw that, I was shocked; I couldn’t believe it,” says Benioff with what seems suspiciously false modesty. “Only two years ago, we weren’t even on the Magic Quadrant, and now we're in the top right hand above Siebel. I think what that really says is a couple things: number one, that on-demand is going mainstream. This is the big time and the big leagues, and customers don't want to buy software anymore. So you either offer on-demand or you're not a player.
"The second thing I think it really speaks to is the way Gartner does that survey is you have to produce a lot of referenceable customers of size and scale, and we were able to do that very easily. I think that that has really impacted our ability to move into the Leader Quadrant. That means if you are not in on-demand, and if you are not producing those kind of customers, you're not going to play.
“Competitors have to respond, saying, sure, we have on-demand, too. We’re just like Salesforce.com. We're a big German software company, but we’re just like Salesforce. Or we deliver it on a CD, but we're just like Salesforce. The reality is they are not. As evidence to that, the customers.
“When I meet analysts, I like to play a little game with them, and I say look, can you tell me the names of two or three or more Salesforce.com customers off the top of your head?' Then I ask them, now tell me, who’s the top SAP CRM customer? Who's the top Oracle CRM customer? Who’s the top Microsoft CRM customer, on-demand? Because you don't hear those names."