Salesforce Set to Pass SAP as Largest Enterprise App Company

In the high-flying world of enterprise app companies there is much competition. And when it comes to the peak of the pyramid, SAP has sat at the top for a while. The German company is in fact the largest non-US software company in the world by revenue. 

Unfortunately for SAP, that is about to change.

That’s because Salesforce is set to surpass SAP as the largest enterprise app company in the world. 

Salesforce, home to a broad skyline of cloud-based solutions like the ecommerce platform of choice for big brands with complex processes, Salesforce Commerce Cloud as well as AI-infused Marketing Cloud and Target, just released their first quarter takings for 2021.

Total first quarter revenue was $5.96 billion, which was an increase of 23% when compared to the same time last year. According to Salesforce’s CEO Marc Benioff this was the San Fran company’s best ever first quarter performance. 

With such a strong momentum – which in turn is building on strong performances over the years – Salesforce is eyeing up SAP from across the Pond.

“We’re really seeing some momentum and some cadence that’s very powerful for the company,” said Benioff. “And the quarter once again demonstrates the strength and durability of our business, and the quality of our leadership team.”

Benioff mentioned that when it came to SAP, they had a smaller presence in the customer relationship management market when compared to the past. Add to this the fact that Salesforce currently takes the largest chunk from the market share when it comes to the CRM world; while SAP has a global CRM market share of 4.8% Salesforce eats up 19.8%.

Benioff added during the quarterly call that “we’re about to pass SAP as the largest enterprise applications company in the world.”

Looking further ahead, Salesforce forecasts that by 2026 it expects to reach revenues of $50 billion – which would be an increase from $21.25 billion on the fiscal year ending 31 January, 2021. Switching to SAP, it reported that its total revenue of 2020 reached $33.16 billion (€27.34).

Salesforce is also doubling down on investing in more and more cloud solutions. It recently bought the communications platform Slack for just under $30 billion.

Businesses have been looking to carry out data analysis on the cloud to improve their customer interactions. And like everything under the pandemic, there has been a great acceleration in the digital transformation of both B2Bs and B2Cs – in which Salesforce caters for with Commerce Cloud that is split into Salesforce B2C Commerce and Salesforce B2B Commerce.

Partnering has also become a major focus of the company. “Without our partners pushing us,” added Tyler Prince, Salesforce’s channel chief, “without our partners contributing to us, without our partners building services and software around what we do, I’m not sure we’d be in the position we’re in… And we welcome and appreciate that.”

Wider ecosystem

As Salesforce continues its relentless shift to the summit, and investing in new capabilities, it follows that tech consultancies should equally dig deep and invest themselves in advancements to their team capabilities.

Here is the mutually-reinforcing mechanism of dual advancement where innovation in the software triggers innovations in developer skills at the individual level as well as the team level – so that success is delivered across the whole ecosystem.

As one Salesforce user said “We see many of our Salesforce clients asking about integrated solutions to many of the hyperscalers, specifically AWS… They are looking for that front office and back office connection, which is an untapped market and one we would like to see Salesforce move further into.”

Elsewhere at Salesforce during its first quarter takings, its subscription sales and support sales topped $5.54 billion, which was up 21% when compared to the same quarter last year.

When it came to its Tableau and Mulesoft divisions, it brought in $716 million, which was an increase of 46% when compared to the same quarter last year.

Heading into the second quarter, Salesforce expects revenue in their second quarter to add another $6.22 billion, which would represent a year-on-year increase of 21%.

And finally, Benioff pointed out that this year’s Dreamforce conference, scheduled for September 21-23, is going to be held in person across San Francisco, New York, London, and Paris, as well as incorporate digital aspects.

PS: ArganoUV is one of the world’s leading Salesforce B2C Commerce Cloud development teams. Contact us to see how we can work together.