Microsoft reportedly offered $US55 billion to acquire Salesforce earlier this year, only to get turned down by its CEO Marc Benioff who countered with a $US70 billion price tag.
Now, it looks like Microsoft is upping the competition against Salesforce’s most important product.
In an note on Tuesday, JP Morgan shared a survey result that showed Microsoft being Salesforce’s biggest competitive threat in the cloud CRM market.
The survey asked, “What is the single biggest change you have seen in the competitive landscape facing Salesforce.com in recent months?”
Of the 56 vendors that participated, 23% of them picked Microsoft. That’s way ahead of number two Oracle, which was only named by 11%.
“Feedback resoundingly shows Microsoft becoming more visible and competitive in the Cloud arena while others are stagnating, cited by 23% of partners and summed up best by one comment: ‘Microsoft appears to be closing some ground in terms of retooling their platform to what is now becoming a cloud-dominant computing space,'” JP Morgan wrote.
The survey asked only 56 Salesforce partners, so the result should be seen with a grain of salt. But some of the comments from the survey reflect how Microsoft may indeed be closing in on Salesforce in the CRM space:
- “Seeing more competition with Microsoft Dynamics.”
- “Microsoft Dynamics’ CRM is going all cloud based and is significantly cheaper.”
- “Surprisingly, I have heard about Microsoft winning some sizable CRM deals.”
The survey results are good news to Microsoft who’s long been regarded as lagging behind some of its bigger competitors like Oracle and SAP in the CRM space. In fact, Microsoft only had 5.8% of the CRM market share last year, ranking fourth behind Salesforce, SAP, and Oracle, according to Gartner. Salesforce was the leader with 16.3% market share.
But Gartner also noted in its annual Magic Quadrant Survey that Microsoft Dynamics CRM is “experiencing renewed investment and focus within Microsoft,” and that it was the second most asked for CRM product in a global survey in the first quarter of 2015.