Learnings from Salesforce
Tien Tzuo, Chief Strategy Officer, Salesforce.com gives some lessons to budding entrepreneurs
Salesforce.com is trying to morph the world of complex enterprise software into the simplicity of Internet,
they started about 8 years back, have 5 Lakh plus users with 800$ Average revenue per user
Seven lessons:
(1) Marketing: Create awareness of the product by generating buzz, stories in internet journals,
ask top bloggers to review your website, interviews on podcast
(2) Evaluation: Invest your marketing budget on creating content which caters to different
user groups like one time user, power user, developers, investors etc
(3) Product Design: Keep it simple initially, use a layered architecture, make the product develop from easy to use
features into a full featured product as your users grow based on their needs.
(4) Sales strategy: When people evaluate your software, have sales reps call them up and talk to them
about what they liked, what they expect to see, which aspects they did not like etc. Create a two tier sales organization with one tier in lead followup and another in closing the deal.
(5) Target customers: Pursue all customer segments, pursue every thing that comes to you, “If there are more users from IBM, call them up and ask what they liked, develop features suitable for them”
6 steps:
– Put the product out early
– Create a buzz
– Let users come and evaluate
– Followup with the top user segments
– Get feedback on what they need
– Cater to thier needs
(6) Let users experiment with the product before signing up. Create a guest login?
(7) Focus on post sales operations, Look at attrition and growth rates of customers, make product manuals
equivalent to pre-sales brochures. Make the customer win by continued support.
Questions
* What free trials do they offer? They tried with 1 year free trial initially, then reduced it to 3 months,
then to 30 days and finally settled on 30 days
* What metrics do they use to track users? Number of people who sign up, people signin up by search engine marketing, qualification, evaluation rates, closing rates, deal rates.
* How do they address the low entry barriers for this business? They have spent USD 50m – 100m on data centers,
Focussed on core competencies (sales and on demand delivery) instead of building ERP modules themselves
* What are the risks now? How to maintain the high growth,
How not to stumble in the long marathon, How to prioritize the opportunities?
