AI Is The Future Of Salesforce
By Jon Markman, contributor, Forbes
If Salesforce founder Marc Benioff has his way, artificial intelligence software will infuse every facet of the corporate world, making employees faster, smarter and more productive.
While that might seem optimistic, Benioff has a history of getting enterprise productivity software right. Salesforce customer relationship management software has already had a huge impact on the way corporations interact with existing and prospective clients. What he hopes to do now is take that to the next level.
Marc Benioff, chairman and chief executive officer of Salesforce.com Inc., gestures during a panel session at the World Economic Forum (WEF) in Davos, Switzerland, on Wednesday, Jan. 20, 2016. World leaders, influential executives, bankers and policy makers attend the 46th annual meeting of the World Economic Forum in Davos from Jan. 20–23. Photographer: Jason Alden/Bloomberg, Marc Benioff
Recently he’s been investing heavily, buying smaller companies and hiring talent to build an artificially intelligent platform called Einstein. It’s a big deal. Einstein will not just consume and manage information like traditional CRM software suites. It will learn from the data. Ultimately it will understand what customers want before even they know. That would be a game-changer in the CRM industry.
Building Einstein has not been easy, or cheap. Salesforce started buying productivity and machine learning startups RelateIQ, MetaMind, and Tempo AI in 2014. This year it acquired e-commerce developer Demandware for $2.8 billion, Quip for $750 million, Beyondcore for $110 million, three very small companies, Implisit Insights, Coolan and PredictionIO for $58 million and Your SL, a German digital consulting concern to round out its German softwareunit. If all of that seems like a lot, it is. It’s also $4 billion spent and, more important, a significant increase in head count.
During a conference call with analysts, Benioff explained the logic:
“We have been able to stitch all this together into this incredible AI platform, and this focus on AI and on the critical aspects of AI as the next wave of our industry has resulted in a machine-learning team of more than 175 data scientists who have built this amazing Einstein platform.”
The company expects to have new Einstein enabled products: Sales Cloud, Services Cloud, Marketing Cloud and Analytics Cloud ready for developers shortly. They will be able to build applications on top of the clouds using their own code or Einstein extensions.
Salesforce stock sank 4% lower following its recent earnings report. Although profits exceeded analyst expectations and revenue pushed above $2 billion, guidance for the next quarter was slightly below the consensus view. Sellers punished the stock on the weaker outlook.
This is the premiere stock in the CRM space. It continues to grow fast and make investments in AI to be stronger in the future. I will be looking for a good level to recommend longer-term positions.
Jon Markman is president of Markman Capital Insight. Click here to sign up for his free VIP newsletter on the intersection of technology, business and culture
Originally published at www.forbes.com on September 13, 2016.