Salesforce.com, Inc. has announced a strategic partnership with Alibaba.com. The aim of this is to transform customer success. As part of the partnership, Alibaba will now be the exclusive provider of Salesforce to customers in mainland China, Macau, Taiwan, and Hong Kong. Also, Salesforce will be the exclusive CRM product suite that will be sold by Alibaba.
This, however, isn’t the first time Salesforce is eyeing the gigantic Chinese market. Back in 2007, Salesforce released their Salesforce China Edition aimed at the Chinese market but didn’t receive much success.
Why is Alibaba & Salesforce partnership a big deal?
“They [Alibaba] currently hold over half of the market, which is estimated to grow 55% to $331.2 billion in three years, according to Gartner. Alibaba’s cloud business has been generating triple-digit revenue growth over the past three years, outpacing the industry. Gartner estimates that Alibaba last year accounted for almost 20% of the market in Asia for two forms of infrastructure cloud services.” – Bloomberg
Salesforce is being ambitious towards progress and needs to increase its yearly income by 2023 financial year, to as much as $28 billion. With this partnership, Salesforce has reached closer to its goal.
Salesforce can now enter China’s massive online population through Alibaba’s marketing channels, since Alibaba has a huge cloud service business. But this partnership will also take Salesforce close to full agreement with China’s laws regarding data security.
Gartner analyst Olive Huang says, “There is no official date when the services will be made available, but the partnership will give the CRM giant local expertise and data residency.
While Salesforce software can run in the public cloud, for example on AWS in Australia, moving the products to AliCloud will be a major engineering challenge.”
What can we expect?
Alibaba does not have a small-and-medium business eCommerce marketplace, so, this association with Salesforce will fill that void. Salesforce, who has been seeking to gain ground in China, will achieve sales channels through Alibaba, that will eventually help local companies in the region. This partnership between Salesforce and Alibaba is a significant announcement and will open the doors for promising innovations. It will all depend on how successfully the two partners navigate their relationship.
Will Salesforce be able to conquer the Chinese Market? Let us know what you think in the comments below.