Companies are throwing money at what Salesforce calls 'the greatest product' it's ever built

Marc BenioffBusiness Insider/Julie CEO Marc Benioff

The big new product announcement at last year’s Dreamforce, Salesforce’s huge annual conference in San Francisco, was the release of Wave, a new data analytics platform.

Wave is Salesforce’s first attempt at data analytics, which helps companies visualise the massive amounts of data they’re collecting about their business. It provides graphs and charts that help businesses make better decisions.

Since Wave was released late last year, we hadn’t heard much about how it’s doing in the market. But according to a recent note by the investment bank Pacific Crest, companies are loving it.

“We heard from partners that customers are actually paying over $US1 million, in some cases, for the Wave product,” it said.

Considering Wave costs about $US125 a month per seat, it’s pretty impressive that Salesforce is selling $US1 million contracts in less than a year of rolling it out. Even Pacific Crest notes the fact that Salesforce is racking up those big contracts is “very encouraging.”

In fact, this is exactly what Salesforce CEO Marc Benioff alluded to during Salesforce’s latest earnings call in February. “[Wave] is our biggest, most exciting revenue opportunity going forward…We’ve never seen a product take off with these kind of numbers before,” Benioff said during the call.

He added that a lot of “very large transactions” came in the past quarter for Wave, including from big enterprise customers like GE Capital, Time Warner Cable, and Merck.

“This is the greatest product, I think, Salesforce has ever built, and it’s going to just transform the way our customers run their business, not just run their sales, service, and marketing,” he said.

Even with these positive signs, Pacific Crest remained a bit cautious about Salesforce’s consensus estimates for the quarter ending April 30, which were at 13.6% year-over-year billings growth. Pacific Crest gave a 12.4% estimate, noting, “we are a bit concerned that FQ1 (April) billings consensus estimates seem too high.”

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