Salesforce.com delivering software as a service message to Canada

More than a year after setting up its first Canadian office, Salesforce.com is quietly working to build up interest in its hosted business software portfolio.

The company on Wednesday invited several members of its Canaidan customer base, which includes Bell Canada and Blast Radius, to its “Success On Demand Tour,” which has already made stops across the United States. The afternoon sessions include client panels and product demos of what Salesforce.com, along with its competition, call the software as a service (SaaS) model of delivering enterprise applications such as customer relationship management (CRM).

“A lot of companies try to keep customers and prospects away from each other,” said Michael Basch, the Salesforce.com vice-president who runs the Canadian office. “Instead of a death by PowerPoint sales and marketing presentation, it’s more about getting these people together.”

Salesforce.com, which competes with companies such as NetSuite, has spent the last six months recruiting staff for the office it has set up on Bay Street in the heart of Toronto’s financial district. Basch said the company employs about 60 people in Canada right now, though it is not entirely dedicated to business on this side of the border.

“This office handles a good amount of business for the eastern half of North America,” he said. “We have a lot of people focused on the East Coast.”

Michael Hyjek, research director of customer segments at Toronto-based IDC Canada, recently published a vendor profile of Salesforce.com that examined its potential in the Canadian small and medium-business space. He said educating the market will be a major challenge.

“We spoke to over 130 medium market firms (100-499 employees) and over 60 per cent were still not familiar with the software as a service term,” Hyjek told ITBusiness.ca.

Canadian SMBs currently spend over $50 million on CRM, and whether they understand it or not, Hyjek said they spend over $60 million on software as a service. Overall, the CRM is expected to grow at a compound annual growth rate of just under five per cent through 2009, he added, while SaaS is expected to grow10 per cent in the same period. “So there is apetite for both CRM and SaaS from SMBs, which bodes well for companies that are chasing those markets,” Hyjek said.

Among the partners in Toronto this week is Intacct, which has created an enterprise resource planning (ERP) application that can integrate directly with Salesforce.com. Robert Jurkowski, the company’s chief executive, said the dominance of packaged ERP suites has not gotten in its way so far.

“In SMB and mid-market we’re seeing a lot of adoption,” he said. “On the top end, a lot of those people do have SAP or Oracle, and in those cases, we’re providing integration with Salesforce.com in helping front office users complete the (order management) process and integrate into a system like SAP.”

The partnership can be particularly helpful as more firms try to differentiate themselves in the SaaS segment, Basch said.

“We compete against NetSuite in a limited number of deals, as they’ve been more geared towards accounting, ERP and smaller companies than we are,” he said.

Earlier this month, Salesforce.com bought a mobile applications campony called Sendia to help it deliver on-demand software to handheld PCs and cell phones.

Comment: info@itbusiness.ca

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