Learning Objectives
- Distinguish a platform business from a software product business by showing how Salesforce created value through Salesforce Platform and the AppExchange marketplace.
- Analyze the business-model choices behind AppExchange, including partner recruitment and marketplace monetization.
- Examine the architectural discipline required to support a trusted platform, including reusable capabilities, APIs, multitenancy, layered extension, packaging, and governance over shortcuts.
- Assess how Salesforce nurtured an ecosystem by investing in developer, architect, and designer communities through Trailhead, documentation, certifications, events, advocacy, and feedback loops.
- Consider the strategic tensions of running a platform that must serve Salesforce’s own products, external customers, and third-party partners while balancing trust, innovation, customer success, and revenue growth.
Abstract
In 2023, Salesforce was the provider of the CRM system with the biggest market share. Besides providing a CRM software product, the company also offered an external developer platform called Salesforce Platform. Salesforce Platform enabled CRM customers to customize their CRM system and allowed partners (third-party developers) to develop cloud apps that could be distributed via Salesforce’s AppExchange marketplace. Since its official launch in 2008, Salesforce Platform had become a major revenue contributor for the company, including from over 7,000 apps in AppExchange.
Building a successful platform business extended far beyond building a technology platform to nurturing an entire ecosystem around it. Based on interviews with twelve executives, this case study illustrates what it takes for a product company to build a platform business—developing and scaling the business model, engineering the technology platform, growing a vivid community of developers, and marketing and selling the platform—and how Salesforce addressed related challenges.
Appropriate for the Following Course(s)
digital platforms, digital ecosystems, business models, enterprise architecture, and product management
THERE IS NO TEACHING NOTE FOR THIS CASE STUDY.