December, 2010

Shark Jumping at Dreamforce

Microsoft's gambit didn't pay off

Microsoft’s gambit backfires

It didn’t have to be this way.  Microsoft and Oracle and others used the Dreamforce week as marketing opportunities with questionable success showing that it’s better to do nothing than to try to get cute.  Each company’s attempts were either half hearted or backfired and only served as statements of “We’re number two!”

I was in San Diego and Cannes several years ago when Salesforce got cute around the edges of the competition’s user soiree and it worked and now it seems like everyone wants to be cute.  San Diego and Cannes were Siebel events.  In San Diego, Salesforce set up tables outside the convention center and gave out Krispy Kreme donuts and coffee to Siebel users.  It was a lark, a joke that was so innocuous even Tom Siebel played along and was seen on tape quaffing some coffee.  In Cannes a little French panel truck circled the Palais de Congress with the famous, or infamous depending on your world view, Salesforce no software logo.

These were simple pranks that have a long history in politics and were pioneered by the late Dick Tuck, a Democratic operative who once famously hired a group of obviously pregnant black women to picket a Nixon rally with Nixon’s own campaign signs which read, “Nixon’s the one!”  Yes.  After Nixon won the election one Donald Segretti was appointed to be the GOP’s answer to Tuck.  He was implicated in the Watergate fiasco and went to jail as I recall.

Twain said, “History doesn’t repeat itself, but it rhymes” and this week we saw it rhyme in San Francisco.  Oracle hung a sign on the side of one of the Moscone buildings that proclaimed “Oracle #1 in CRM” they did nothing else to bolster their claim and by the end of Dreamforce I am sure Hemingway would have said that it hung a “flag of permanent defeat”.

In contrast Benioff has crashed the Oracle party in the last two years to deliver a mature and positive message.  He can afford to.  As one of Oracle’s largest customers he can have it both ways but while taking advantage of the situation he remains above board (for the most part) and starts his speeches with the words, “We come in peace”.  It’s funny when David tweaks Goliath but it doesn’t work backwards.

Oracle's only effort

The contrast with Microsoft’s overreach in San Francisco could not be more glaring.  Microsoft borrowed from the book of Segretti with a campaign that attempted to pun on the word force.  People on Segway two wheelers scooted around in front of the Moscone with posters of a supposed user and a headline reading “I didn’t get forced”.

The picture was supposed to be of a real customer who decamped Salesforce for Microsoft but we never found out who he was or what company he worked for.  The campaign was supported by a full-page ad in The Wall Street Journal on Monday and for a few hours things looked a little dim for Dreamforce.  Not to worry though.  On Wednesday morning, the “user” showed up right on stage at Dreamforce fresh from SFO and parts unknown.

Here I think Larry Ellison’s tutelage and ancient Chinese warrior philosophy took over.  Benioff did what we would hope any CEO worth his perks would do.  He asked what was wrong and promised to do better then he publicly asked the entire Dreamforce audience to invite the prodigal customer to return to the fold.  Of course he agreed.

In all likelihood the customer was an actor or a model who stood for a Microsoft photo shoot.  What’s remarkable is that he wasn’t under contract with Microsoft for a longer term, which would have prevented him from being present at Dreamforce.  Instead the Benioff marketing machine simply rolled up Microsoft’s campaign and stuffed it back from where it came.

I hate to be hard on Microsoft because they are nice, hard working people and they have good products and a clear vision.  But I am simply relating the facts that were everywhere to be seen.

Even after ten years of watching Salesforce play chess while they played checkers, few people in the industry understand that Salesforce is thinking several steps ahead of them.  For instance, just as the whole cloud computing discussion looked like it was leveling off and achieving a kind of parity between the multi-tenant and single tenant camps, Salesforce came along and upped the ante again by introducing database.com, the Heroku acquisition and Chatter.

If this was poker I’d say that for ten years the rest of the industry has been calling while Salesforce just keeps raising the stakes.  If you’re going to win at this game you’ve got to leapfrog but the establishment never leapfrogs because it would upset their hegemony in the legacy base so you get the situation you have.

Much as I enjoy these confrontations I hope they stop.  The clear lesson from this week is that you can over do it.  And when the spotlight is on Salesforce, Oracle, Microsoft or whoever, that company has the public relations advantage.  They have millions of dollars staked on a successful outcome and some skunk works prank by a competitor is not likely to achieve anything positive for the simple reason that it’s ad hoc and the principal vendor has been planning the event for a year.

The real winner in the vendor effort to leverage Dreamforce this week was SAP.  They didn’t pay much attention to Dreamforce but they did try to leverage the fact that a high percentage of the analyst industry’s best and brightest were in San Francisco.  When my work in San Francisco was done I went down to Santa Clara for a day-long briefing.  SAP simply wanted to share with us what they were doing in the product area to take advantage of cloud computing, social and other technologies.  They’ve got some good things in the works and while they’re just as competitive as any other vendor, they simply decided to let their products and services speak this week rather than their marketing department.  It was such an adult thing to do.