Microsoft’s $55 billion interest in Salesforce
However, Microsoft’s offer price failed to meet the expectations of Salesforce CEO Marc Benioff. Reportedly, Microsoft offered to pay $55 billion for Salesforce, but Benioff anticipated a price of $70 billion.
Why Microsoft is so keen to add Salesforce to its portfolio
According to a May 2015 Gartner report on worldwide customer relationship management (or CRM), Salesforce leads the CRM space with ~18.4% market share, as the above chart shows. This is the third consecutive year that Salesforce has held this leadership position.
SAP (SAP) and Oracle (ORCL) trail Salesforce with a market share of 12.1% and 9.2%, respectively. Microsoft (MSFT) held 6.2% of the market share. Gartner’s report revealed that Salesforce has a revenue growth rate of 28.2%, approximately 7% higher than Microsoft’s.
Revenue growth rates
The above chart compares CRM revenue growth rates by the industry’s major players for 2014 worldwide CRM sales. Salesforce leads by a large margin, with a 28.2% revenue growth rate.
With these numbers in mind, it’s clear that Microsoft wants to acquire Salesforce to provide a boost to Microsoft Dynamics, its offering in the CRM space. Both Salesforce and Microsoft Dynamics are CRM software packages that enable businesses to track and plan sales, marketing, and customer service efforts.
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