The future of Salesforce is Industry Specific

The future of Salesforce is Industry Specific
Max Maeder
At this stage in Enterprise SaaS, the new normal is industry-specific tooling. Salesforce signaled this when acquiring Vlocity (now Industry Clouds) in early 2020 and it's picking up steam.
The future of Salesforce is Industry Specific

Why the future of Salesforce and SaaS is industry tooling

The 'verticalization' of SaaS is taking hold in the Enterprise.

It should come as no surprise that platforms like Salesforce need to approach product development with a niched down focus. When the company launched in 1999, the concept of a CRM and the features included in this type of tool were in their infancy. At the time, a CRM was effectively just a digitized rolodex and what worked for 1 industry could easily translate to others.

This is NOT the case in 2022.

Not only are the features and automations companies build in their CRM highly specific to their industry but the broader ecosystem of applications integrated to your CRM has exploded. It presents unique platform architecture, integration architecture, and data strategy challenges with the right solutions being highly dependent on a company’s industry / use case, current growth stage, team size, and more.

The beauty of Salesforce is its flexibility. Configuring existing products to fit the needs of the business or building entirely custom solutions on top of the platform - things like Veeva (CRM for Pharma), nCino (CRM for Banking), AgentSync (CRM for Insurance), and Litify (CRM for Legal).

In early 2020, Salesforce acquired Vlocity for $1.33B. While this ended up being the foundation for Salesforce Industries, I believe it was more about acquiring an industry-specific product development competency.

Building enterprise-grade SaaS solutions is challenging enough from a technical perspective. Doing it to address the needs of 1 industry adds another layer of complexity since you need the technical competency and deep domain expertise. And yet Salesforce is doing it for 12+ industries and counting (with the recent launch of Automotive Cloud).

Building Industry Specific SaaS requires a modular approach

The team behind Salesforce Automotive Cloud provides an insightful look into how they think about industry-specific tooling at Salesforce:

"Automotive Cloud provides a modular way to connect customer, car, dealer, and other parts of the organization together that need customer info, like finance, warranty and connected vehicle services,” said Michael Ramsey. There needs to be something like this in place to manage customer IDs and all the interactions between companies, he said, adding, “I’m sure other companies will follow with some kind of vertical offering like this, but right now it fits in a niche that’s a step above a standard CRM and is something closer to a customer operating system.”

A modular approach seeks to make it easier for companies to develop applications on top of the vanilla CRM tool rather than Salesforce trying to provide a turnkey solution that fits every potential use case. It's about providing companies with a 'common starting point' - rather than providing a generic tool and requiring companies to make the same customizations just to get it to a place where they can build more complex solutions for their industry, offer Automotive Cloud with some of those pre-requisite features built in and let each company take it from there.

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