Comment by deathhand
So why does Salesforce still prosper? They are just a fancy database.
So why does Salesforce still prosper? They are just a fancy database.
Because they lock you in. ChatGPT has no lock in, in fact none of the LLMs do just because of how they work.
Salesforce doesn't make a good product, and certainly not the best product. It doesn't matter, you don't need to if you can convince idiots with money to invest in you. And then the switching cost is too much, too late.
That business model is a dying one and all the software companies know it. That's why Microsoft has spent the last 15 years opening up their ecosystems. As automation increases, switching cost decreases. You cant rely on it.
Because they locked-in a ton of enterprise customers and have an army of certified consultants who build custom solutions for you.
Good question. Salesforce does well because they provide the application layer to the data.
The WWW in the 1990s was an explosion of data. To the casual observer, the web-browser appeared to be the internet. But it wasn't and in itself could never make money (See Netscape). The internet was the data.
The people who build the infrastructure for the WWW (Worldcom, Nortel, Cisco, etc.) found the whole enterprise to be an extremely loss-making activity. Many of them failed.
Google succeeded because it provided an application layer of search that helped people to navigate the WWW and ultimately helped people make sense of it. It helped people to connect with businesses. Selling subtle advertising along the way is what made them successful.
Facebook did the same with social media. It allowed people to connect with other people and monetized that.
Over time, as they became more dominant, the advertising got less subtle and then the income really started to flow.
Salesforce is similar in that it helps businesses connect with and do business with each other. They just use a subscription model, rather than advertising. This works because the businesses that use it can see a direct link to it and their profitability.