Boston-area Software Firms Hitch Their Wagons to Salesforce; Say Ride Can Be Rough But Profitable

1/14/09Follow @wroush

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Salesforce,” he says, so Kadient is working on software that will connect its playbooks to Oracle’s CRM on Demand product. Still, “it was a good decision for us to start with Salesforce, because that’s the most commonly used online CRM app.”

Brainshark is another area company that joined the AppExchange as a way to reach out to CRM users. The company (which I profiled last March) allows users to upload PowerPoint slides, record audio tracks via telephone, then send out the finished presentations as sales or training tools. “Our product can be used for marketing and sales force leadership, so there is this synergy between users of Salesforce and users of Brainshark,” says Andy Zimmerman, the company’s vice president of business development. “Brainshark lets you create and share presentations; Salesforce lets you track people and your communications with them. Our connector makes it a seamless process to send presentations to your Salesforce contacts, and get tracking data about who watched them.”

At Hubspot, in Cambridge, MA, developers have come up with a Salesforce app designed to help companies coordinate their sales and marketing efforts more successfully. “One of the classic challenges in marketing is understanding which of the leads you’re producing are the best leads—which ones are going to become customers—but typically, marketing sends leads over to sales and they never hear from them again,” says Mike Volpe, Hubspot’s vice president of marketing. Hubspot’s Salesforce app is a “closed loop marketing” system that aggregates data gathered by Hubspot’s lead tracking software—the last time a given prospect visited the company website, for instance—with data from the sales side, like whether that prospect has become a customer. “Taking that information back out of Salesforce allows you to compare different campaigns and get a sense of which are generating the most leads,” Volpe explains.

Volpe says Hubspot (profiled in this August 2007 story) wouldn’t have considered building a big chunk of its business around Salesforce, the way Kadient has. But integrating its own services with Salesforce did make sense, especially since 20 percent of Hubspot’s existing customers were also Salesforce subscribers. “We don’t believe you can build a large, independent company based purely on building an AppExchange product,” Volpe says. “That being said, one of the things you can do to provide value for your user base is connecting with Salesforce.”

Liz Cobb, the founder and CEO of Makana in Lexington, seconds Volpe’s point. Makana sells software that helps companies keep track of the incentive-based payments (i.e., commissions) earned by their sales reps. “About 28 million people in the U.S. work on some kind of incentive-based compensation, and when you think about it, the 500,000 subscribers who log into Salesforce every day are probably all on some kind of incentive plan,” Cobb says. So it was a no-brainer for Makana to adapt its sales compensation planning software for the Salesforce AppExchange—even though it was “a little time consuming,” in Cobb’s words. “They want to make sure that if you put something in their system, it’s not going to break something else. That certification is a bit of a hurdle, and there is a cost to it. But they’re the big gorilla in the sales world, and you have to pay to play.”

As positive as most of my interviewees were about their companies’ decisions to join the AppExchange, most also echoed Cobb’s point, that Salesforce is in some sense the lumbering giant of the online sales application world. At this relatively early point in the evolution of the AppExchange, outside developers who want to contribute their applications to the marketplace shouldn’t expect a lot of hand-holding or personal attention.

“I would like it better if we had a technical partner or resource where we could just call them up,” says Ernst at Kadient. “But we’re so small that we just have to … Next Page »

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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  • http://sellsellsell.salesnexus.com Craig Klein

    I’ve spoken with many App Exchange developers who say being listed there has been meaningful from a marketing credibility perspective but, few actual sales opportunities have come via Salesforce.com.

    The user is often left in the middle trying to make Salesforce.com and the App Exchange provided software work and both sides pointing at the other when problems arise.

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