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What Does Salesforce Think about the Microsoft-LinkedIn Deal?

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Part 10
What Does Salesforce Think about the Microsoft-LinkedIn Deal? PART 10 OF 13

How HeyWire Could Provide a Boost to Salesforce’s Service Cloud

HeyWire could complement Service Cloud communication

Earlier, we discussed Salesforce’s (CRM) acquisition of HeyWire. HeyWire will be integrated with Salesforce’s Service Cloud. Service Cloud capability enables companies to deliver customized customer service and support.

Meredith Flynn-Ripley, HeyWire’s CEO and cofounder, stated in a blog post that the company was part of Salesforce’s ecosystem. She said that Salesforce’s acquisition of HeyWire would “bring this new communications channel to the Salesforce Service Cloud with fully integrated mobile messaging capabilities that enable companies to connect with their customers in entirely new ways.”

How HeyWire Could Provide a Boost to Salesforce’s Service Cloud

CPQ is now part of Salesforce’s Service Cloud

In the first week of September 2016, Salesforce announced that its CPQ (configure, price, quote) technology, which had been part of its Sales Cloud, was now part of its Service Cloud. CPQ’s addition to the Service Cloud segment will be beneficial, as CRM is essentially the integration of sales and marketing, wherein each factor aims to provide a holistic view of the customer in its own way.

Salesforce got a hold of CPQ by acquiring SteelBrick, a developer of CPQ and billing applications. SteelBrick was Salesforce’s largest acquisition in 2015.

SteelBrick offers the Quote-to-Cash software, a suite of backend sell-side applications that simplifies the sales process by automatically generating quotes, contracts, and billing. It enables sales personnel to piece together accurate pricing for deals for potential customers. Quote-to-Cash is the part of the sales cycle that takes over once interested customers step in. Prior to Salesforce’s acquisition of SteelBrick, Oracle (ORCL) acquired BigMachines, a cloud-based CPQ company, in 2013.

Enhancements to Salesforce’s Service Cloud through its acquisition of HeyWire and its addition of CPQ are likely to lead to higher revenue growth. As the chart above shows, Salesforce’s Service Cloud segment contributed 31% of its subscription and support revenue in fiscal 2Q17. Its revenue rose 29% on a year-over-year basis to $540.1 million. The Sales Cloud segment earned 40% of Salesforce’s subscription and support revenue in fiscal 2Q17, making it the highest contributor.

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