“Steve once told me there are three things you have to do,” he said. “Number one, you have to be 10 times larger in 24 months or its over. Number two, you need to get a huge client on your service like Avon. Number three, you need to build an application economy. I said, ‘What’s an app economy?’ He said, ‘I don’t know, but you better go figure it out.’” (see more).
As Marc Benioff mentioned in interview to Forbes his way to figure "application economy" out was AppExchange - platform that allowed purchase of add-on to SalesForce developed by third-parties.
But last month there were few of announcements that may dramatically change Application Economy:
- Salesforce Identity announced last year at DreamForce became generally available on October 15th, 2013 and allows customer to purchase without license of Sales automation;
- then on October 31st next announcement - Salesforce Private AppExchange which allows company to centralize enterprise applications and their provisioning.
Together these 2 things brings interesting speculation - Salesforce is building Private Application Economy - platform where developers can build B2B apps for all business users, even those beyond direct licensing of Salesforce.com.
Enterprise software (B2B) development can get disrupted as much as Apple AppStore disrupted B2C software development. But with big difference - Apple AppStore focused on single payment/purchase, while Salesforce AppExchange is focused on subscriptions (re-occurring monthly payments) - much more favorable business model for software developers.
ERP2.0 group at LinkedIn can get brand new focus now, as it won't be long when all ERP functions can be purchased a-la-carte from AppExchange without need to become customer of sales automation. Effectively giving Salesforce chance to repeat what Amazon did - built technology platform to support core business of selling books so good that, after selling technology as service, platform is now bigger business than books!
But if Marc Benioff has his sight beyond Steve Jobs "Application Economy" advice he might as well considering building Rental Economy - where not only apps can be purchased on AppExchange, but any products with e-capabilties (internet of things). And soon not only customer leads will be funneled on Salesforce, but leads for e-things as well...
And this New Economy is so big that even old enemies are uniting to not choke on it.
best regards,
Roman Havrylyak
11/8/2013
P.S. 11/17/2013 - one day before DreamForce conference in San Francisco interesting update to support idea that Salesforce.com is following merged path of Amazon (techstack for sale) and Apple (B2B apps store) http://gigaom.com/2013/11/17/salesforce-com-wants-to-sell-your-mobile-apps-to-its-customers/
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