Thursday, June 10, 2010

Chatter has a good potential to increase Salesforce average revenue per customer is extending their SaaS CRM with a whole new suite of Enterprise 2.0 collaboration capabilities called Chatter.

From design perspective, Chatter looks a lot like Facebook, and is fully integrated with  It provides features such as Profiles, Groups, Document Sharing, Feeds, Subscription/Notification, etc:
Chatter will also provide a set of APIs to enable existing or new developers to integrate Chatter in their applications.

I believe Chatter is a smart idea, and should be well-received by customers and developers.  I say this, because it raises enterprise collaboration to a new level. Unlike other enterprise collaboration tools which lack business context out of the box, Chatter’s integration in the CRM system should readily demonstrate a quick boost to the sales/marketing and customer service teams.  This is a deeper level of business integration.  It should also be able to enhance Salesforce revenue stream. is an impressive company.  When you look at their financials, they have executed well:

They have not only shown solid growth with respect to # of customers & subscribers, but for the most part been able to maintain a positive ratio in terms of Average Revenue Per Customer (ARPC) & Average Revenue Per Subscriber (ARPS).  However, it has taken a lot of investment to grow, and they need to improve margins.

At this point, Salesforce is not planning to charge for Chatter.  Their strategy seems to be using Chatter to attract new developers, and new breed of applications to expand the usage of the platform (currently there are 911 apps listed in AppExchange).   Given growing demand for collaboration in the enterprise, I think Chatter should be successful and make a big contribution to Salesforce.

The GA announcement for Chatter is expected to be June 22 at Cloudforce 2 Tour.

1 comment:

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