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Technology News South Africa

Salesforce world tour comes to SA with $5.8bn growth projected

The Salesforce World Tour Essentials event held its South Africa stop at the Kyalami Convention Centre in Midrand. Over 2,200 attendees could get firsthand experience of the new innovations on offer in the CRM industry. Last week, shares of Salesforce crashed after the company delivered its financial results. On a year-to-date basis, the share price has now lost more than 15% of its value as the company missed analyst expectations for the first time since 2006.
The Salesforce World Tour attracted over 2,000 attendees.
The Salesforce World Tour attracted over 2,000 attendees.

That share price drop is not a reflection on the business performance when Salesforce has nearly $3bn in free cashflow, but rather a response to slowing growth in the SaaS market.

Despite the market criticism that the CRM software company hasn’t invested enough into AI, the event showcased Salesforce's latest AI and cloud-based solutions, including Data Cloud and the Einstein 1 Platform.

Data Cloud is a data platform that unifies disparate data points into a harmonised data model, while Einstein integrates Salesforce's suite of applications, enabling businesses to leverage AI for automation, analytics, and personalised engagement.

“The point here is that 75 percent of the value that you have from AI is in the front office,” explained Salesforce head of solution engineering for Africa, Linda Saunders.

“This is huge. That means higher productivity, higher margins and better customer relationships.”

IDC report

A new IDC InfoBrief, sponsored by Salesforce, predicts that Salesforce and its partner ecosystem will generate $5.8bn in net new business and 33,000 jobs between 2022 and 2028, driven by these AI-powered cloud solutions.

There is substantial growth in that regional partner ecosystem to the tune of 34% year-over-year, with a significant 43% increase in certifications.

"At Salesforce, we're excited by the strides our customers and partners in South Africa are taking to succeed in the developing AI era," said Zuko Mdwaba, area VP at Salesforce South Africa.

"World Tour Essentials Johannesburg offers the perfect showcase of the region's potential as a centre of innovation in Africa."

A company State of Marketing Report, released at the event, revealed that 85% of marketers in South Africa have adopted AI, with content generation, automation of customer interactions, and programmatic advertising being the most popular use cases.

However, the report also noted that 50% of marketers still require IT assistance to access real-time data for campaigns.

Salesforce remains optimistic about its growth in the region, emphasising its commitment to innovation and providing tailored solutions for the South African market.

Robin Fisher, senior area VP of Salesforce emerging markets, stated, "By embracing the power of AI, organisations in the public and private sector can seize opportunities for growth and contribute to the wider project of economic diversification."

Localised costing

In a separate interview with Bizcommunity,Fisher addressed concerns about competition and pricing in the South African market.

Robin Fisher on stage at Salesforce World Tour Essentials in Johannesburg.
Robin Fisher on stage at Salesforce World Tour Essentials in Johannesburg.

“We have a global standardised price list and then we will work closely with our customers to build a use case, and then based on the use case we'll find a price through a discount mechanism that suits the market that is obviously a win-win,” he said in response to criticism of the Salesforce premium price.

He explained that Salesforce offers different bundles and licenses for various market segments, including a small business bundle with limited functionality.

Fisher also highlighted Salesforce's partnership with AWS for cloud infrastructure and the company's commitment to not passing on the cost of AI to consumers.

“We have Hyperforce, which is where we move our systems onto AWS. Of course, it can work with other hyperscalers, but most of them are built on AWS. We did that for two reasons. One, we didn't want to be in the infrastructure game, it's not what we do, we're not an infrastructure player.

“Two, once we sorted out the meta-layer and we figured it out, it's actually efficiencies, economic efficiencies by being with AWS. If we'd continued to build it and own it, we would have struggled. If anything, we're saying that we can scale a lot more and we're not seeing a commercial pressure to pass it on to the consumer.”

Salesforce's focus on AI, data unification, and skills development demanded a lot of capital expenditure which translated to less-than-ideal quarterly performance. That investment, however, seems to be paying dividends in the company’s future market offering.

About Lindsey Schutters

Lindsey is the editor for ICT, Construction&Engineering and Energy&Mining at Bizcommunity
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