Salesforce.com makes a £447m Buddy with social acquisition

By Chris Middleton
05 Jun 2012 View Comments
Salesforce.com's Marc Benioff

Cloud-based business platform supplier Salesforce.com – the tail that wagged the enterprise dog in terms of cloud computing – has announced the $689m (£447m) acquisition of social media marketing firm Buddy Media.

The move follows in the wake of the increasingly cloud-focused Oracle's $300m (£194m) purchase of Vitrue, a competitor to Buddy Media.

Further reading

Salesforce.com has long been a proponent of the social enterprise, with previous acqusitions including wiki-based directory platform Jigsaw (now Data.com), social media monitoring tool Radian6, and teamwork application Rypple.

While social media platforms such as Facebook, LinkedIn, Pinterest and Twitter have proved attractive to both users and investors, their commercial business models, revenue streams and profitability remain in question, when considered against the size of the communities they support. 

However, Facebook has also proved particularly attractive to marketers, given that it is currently free to use for everyone, and users can opt in to pages and apps, and out of Wall updates. This makes it a more appealing platform for intelligent marketing than Twitter, for example.

Short of putting commercial usage behind a paywall, there seems little that Facebook can do to monetise these activities – on the desktop, at least.

Many businesses now recognise that the size of the social marketing opportunity is so great, and so low cost, that the best way of managing their customer relationships is, in effect, to outsource it to their own customers.

Announcing the Buddy Media deal, Salesforce.com founder and CEO Marc Benioff (pictured) described Facebook – a longstanding Salesforce.com partner – as "the new corporate homepage".

Bringing social media management and marketing into a dashboard of applications makes sense for any socially-focused cloud platform, like Salesforce.com.

However, despite its own popularity and the grandstanding of its charismatic CEO, the future for Salesforce.com looks less robust than it did 12 months ago.

Enterprise behemoths Oracle and SAP, which seemed a long way behind the curve on cloud computing, have played an impressive game of catchup with a raft of cloud acquisitions, while Oracle's Larry Ellison has long held private investments in leading cloud startups.

Salesforce.com's advantage remains the fact that it was built from the ground up for a social-networking, hosted-applications age, and has built strong alliances with companies like Google, on the one hand, and Accenture on the other. But it now competes in a more crowded marketplace, alongside some aggressive, wealthy competitors that have for too long been the butt of Benioff's jokes.

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