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Overall view
As a millennial sales professional, I've had the pleasure of using CRM software (Customer Relationship Management) my entire career. No, I do not have any experience in selling through directories, corporate directories or reports published by third parties. Yes, the old sales dinosaurs were making fun of me, but the truth is that they themselves began to understand the value of high quality customer relationship management software.
The CRM industry is very competitive and has many good businesses. Oracle (NYSE: ORCL), SAP (ETR: SAP), Cisco Systems (NASDAQ: CSCO), Workday (NASDAQ: WDAY), Adobe (NASDAQ: ADBE), Hubspot (NYSE: HUBS) and Microsoft (NASDAQ: MSFT) are perhaps the largest customer relationship management software companies in the industry. These are all large companies with advanced features and known to many sales professionals. However, the most impressive CRM I have worked with is Salesforce (NYSE: CRM). The superiority of Salesforce propelled my sales career quite quickly. California-based SaaS occupies a leading position in the global revenue market, and investment in its growth is supported by strong fundamentals and sound management. The last seven Wall Street reports on Salesforce have been good for the company and the average price target now stands at 181.40 USD. However, the potential growth of this stock is much higher, stocks will reach $ 200 to $ 210 by the end of the year and represent a great buying opportunity for investors.
Source: IDC, Global Semester Software Review, April 2019.
Record results for the fourth quarter and fiscal year 2019
Fourth quarter results seemed to reinforce the estimated price target. Again, the best earnings per share estimates, which were $ 0.70, were $ 0.15 higher than the consensus of $ 0.55.
To summarize:
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Revenue of $ 3.60 billion for the fourth quarter (+ 26% year-on-year).
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Unearned income of $ 8.56 billion (+ 22% year-on-year).
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Annual turnover of 13.28 billion dollars (+ 26% yoy).
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Fourth-quarter operating cash flow of $ 1.33 billion (+ 27% yoy).
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Annual operating cash flow of $ 3.40 billion (+ 24% year-on-year).
The results are rather impressive considering the highly competitive nature of the sector. Salesforce has grown rapidly as a market leader through constant innovation and strategic acquisitions, complemented by a highly efficient business model focused on growth and customer loyalty. The company expects a 21% growth in sales in 2019 and has clearly announced its intention to organically double its turnover over the next four years.
The new world of sales
Before instantaneous information was available, selling was often associated with information asymmetry for the benefit of the seller. Buyers were tired and had to be extremely vigilant and aware of the risk that a product would not meet their expectations and / or have defects. This "wary of buyers" approach was known as "caveat emptor" and made the sales process a straightforward one from the seller's point of view. However, with the technological advances now available at your fingertips, users can quickly access a wealth of information when sold on a product. Essentially, the script has reversed and made selling a much more advanced process in which salespeople must properly diagnose the customer's needs and identify an appropriate solution. Vendors are now more responsible than ever for providing accurate information. This new approach to selling is known as a sales warning and has ultimately benefited the economy by reducing risk, optimizing products and responding more effectively to consumer needs.
Salesforce: the perfect fit
Salesforce completes the new world of sales, far better than its competitors. Sales processes are much more complex, time consuming and analytical than ever before. The customer base is also rapidly growing and managing customers from leads to closing requires strong organizational skills that Salesforce provides seamlessly through its highly customizable platform that greatly facilitates management. pipelines. Even compared to its most competitive counterpart, Oracle, Salesforce is the big winner. From a management perspective, the FinanceOnline website is often the website of choice for choosing a CRM software. The reason is that the ranking criteria of the website cover many topics that are not included in many CRM ranking websites.
Source: FinancesOnline.
Oracle's Sales Cloud plans include a setup fee of $ 2,000 starting from $ 2,000 per month. Oracle Sales Cloud also discourages customers by requiring them to sign long-term contracts with cancellation penalties. Salesforce allows users to engage in short-term contracts with no setup fees. Even an unlimited version offering a wide range of features can be purchased at a price significantly lower than that offered by Oracle. In addition, another key underestimated factor is the compatibility between various devices. This is underestimated because of the increasing mobility of sellers and the need to access information on many devices located at different locations. From an integration perspective, Salesforce is a multiple of six times more than any other customer relationship management software, another key metric given the role and power of big data to identify highly leads. qualified with high potential. Each day, Salesforce generates more than 1.9 billion emails sent from its Marketing Cloud, records more than 9.7 million customer support requests on its Cloud Service, and creates over 3.2 million leads in its Sales Cloud. These values will only continue to grow as the company gains market share.
Source: FinancesOnline.
Information on sales activities, pipeline and forecasting has all been key to strengthening Salesforce's competitive advantage. Salesforce dashboards and reporting offerings are highly customizable and provide real-time, relevant information for sales representatives, sales managers, and senior managers. Salesforce can generate advanced and detailed reports ranging from lost opportunities by geographic territory to the highest value of business by sector or by customer segment. Identifying the most interesting lead sources is a critical step for any business, and Salesforce's ability to accurately report them makes them an extremely valuable and rewarding tool. Complex / long sales processes are the new standard, and Salesforce CRM is one of the most effective customer-centric solutions, making it highly applicable to small start-up businesses, small and medium-sized businesses, and large enterprises.
Source: Fiverr
More potential for the future
Salesforce dominates because of its constant desire to innovate and reshape its sales approaches. Einstein AI, a new artificial intelligence assistant integrated with the various Salesforce cloud solutions, automatically discloses relevant information, predicts future behavior, proactively recommends possible next steps, and ultimately automates these tasks. Innovations like these generate significant revenue potential not just for Salesforce, but for customers to explore new qualified customers who get the most out of their products. Salesforce Lightning has also changed the game in terms of improving productivity. Lightning provides tools and services almost instantly to automate business processes, integrate external applications, and generate reports. Ultimately, a company benefits from increased efficiency, optimized operational capabilities, and the ability to rely on applications directly in line with the buying company.
In the modern era of sales, customer needs are becoming more and more dynamic. Versatile customer relationship management software, capable of revealing the needs of different people, is the only way to stay relevant, as creative destruction victimizes every business for not having developed the capabilities of the product it offers. A better sale produces better products and services to customers. It also generates unprecedented levels of economic growth by offering businesses the potential to deliver these superior products not only to more customers, but also to the right customers. The company expects revenue growth of 26% and GAP of 192%. Given how Salesforce has reinvented the sale, these expectations will once again be exceeded, leading to higher share prices. Salesforce has become synonymous with sales and will boost its price from $ 200 to $ 210 by the end of 2019.
Source: Salesforce.com.
Disclosure: I / we have / we have no position in the actions mentioned, and we do not intend to initiate a position within the next 72 hours. I have written this article myself and it expresses my own opinions. I do not receive compensation for this (other than Seeking Alpha). I do not have any business relationship with a company whose shares are mentioned in this article.
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