Microsoft, a $1.63 trillion-dollar company, is getting ready to make Salesforce, a $233 billion company, history.
CNBC reports that Microsoft has instructed their salespeople to aggressively target their installed base of companies to adopt its Dynamics Customer Relationship Management (CRM) software, with the aim of maintaining its slowing cloud revenue growth. That means Salesforce has a target on their backs.
“I think what’s happened is it’s a new priority,” RBC’s Alex Zukin told CNBC in an interview on Thursday.
The hard sell will reportedly focus on Dynamics and PowerApps, and Zukin said that Microsoft’s senior leadership must approve any enterprise license renewal that leaves out Dynamics, which includes CRM and other business management software, and PowerApps, a tool which can be used to build applications. Microsoft had previously focussed on pushing Azure.
While the work will intensify with its new financial year, Microsoft has already seen some success with Dynamics 365, which grew 38% in Q2 2020, faster than other Microsoft products, likely generating more than $1.8 billion in the last financial year.
Microsoft still has a hard row to hoe, however. According to Salesforce CEO Marc Benioff, in 2019 Salesforce controlled 18.4% of the market in 2019, while Microsoft held 3.7%
It is however not know how the line has bent over the last year and it remains to be seen how intense the competition will be between these traditionally somewhat hostile companies.
Microsoft at one point attempted to purchase Salesforce and recent beat it in a bidding war for LinkedIn.
According to Zukin Microsoft could get Salesforce’s market share simply by buying the company, but likely does not want to attract regulatory scrutiny at this date.