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SalesForce Segments

How SalesForce.com is using wise market segmentation strategies to grow.

There is hidden meaning to Silicon Strategies Marketing’s chess board metaphor.

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Sure, chess is a universal emblem for strategy, because you cannot
win the game unless you think strategically – or unless you are IBM and
build a computer
that simply grinds through all possible moves in order to predict all
possible outcomes of every game. The hidden aspect of chess is that it
is played on a board divided into conquerable places, and the goal it
to dominate space by taking it one piece at a time.

In other words, segmentation.

Market segmentation is like chess in that chasing the wrong segment
with the wrong piece is a catastrophe in the making. Many chess
strategies work like great market segmentation strategies, by taking
the space/segment next to the one you already own and have well
defended.

Like SalesForce.com is doing.

SalesForce started life with the right strategy, namely attack just
one issue and dominate the field. CRM (the software solution, not the
corporate philosophy) was ripe for the taking because it was always
somewhat detected from other centralized applications. This allowed
SalesForce to worm its way into enterprises. Now that they dominate the
outsourced CRM industry, the only way for them to grow is to find
another segment. Since they campaign against licensed software
installed behind corporate firewalls, their segment strategy has to
evolve outside of traditional CRM.

The question: what is an adjacent segment?

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Next to selling to a customer, supporting a customer is key to any
business. Fail at either and you die and painful fiscal death. Thus SalesForce has picked customer service
– which is an extended function of managing the relationship with
customers (CRM) as their next conquest. Stated more simply than Marc
Benioff did – because his marketing team is chasing ‘cloud’ buzz –
SalesForce now offers knowledge bases, community support and a Twitter
tie-in.

Benioff was right in guessing outsourced support systems might be
the next billion dollar opportunity. More to the point, support is the
fraternal twin to sales. Both are linked directly to the customer and
are interrelated. It is easier for SalesForce to extend their current
offering into a compatible or dependant segment than to enter a
completely new market (for example, Benioff would have been bonkers to
launch an ERP offering or the next MMOG).
It is also a more successful strategy because people involved in the
current segment have connections to people in the new segment.

A key aspect of segmentation strategy is to choose segments in which
customers talk to one another. Sales people talk to support people and
need feedback from support databases (log a problem ticket for a
customer and your account manager had better know about it). Thus
SalesForce.com’s “Service Cloud” – a lousy name because it confuses the
customer – is a good segment move not only for its adjacent proximity
to sales and CRM, but because communications channels between
SalesForce’s existing customers and Service Cloud’s target customers
exist and are active.

Now, if we could just get Marc Benioff to show a little excitement.