Salesforce Takes A Direct Shot At Microsoft And Google By Announcing Decision to acquire Tableau

Salesforce Takes A Direct Shot At Microsoft And Google By Announcing Decision to acquire Tableau

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In less than 10 weeks, the world of Business Intelligence/Visual Analytics has seen five power-packed acquisition deals, announced or completed. Firstly, Google announced that it is acquiring Looker, a popular big data analytics platform and business intelligence software company, and making it a part of the Google Cloud family. Alteryx went on to acquire ClearStory Data, Sisense merged with Periscope Data, and Logi Analytics acquired Zoomdata and now comes the biggest story of all.

Salesforce Takes A Direct Shot At Microsoft And Google By Acquiring Tableau

Salesforce has signed a definitive agreement to acquire Tableau at an enterprise value of approximately $15.7 billion. This is the biggest acquisition by Salesforce ever with the last one being Mulesoft at $6.5 billion. The acquisition is likely to boost the ability of Salesforce to compete with Microsoft.

What Makes The Acquisition Special?

The success of Salesforce has always been about the anticipation of the requirements of its customers and then offering them the required solutions so they can grow their business. With the addition of Tableau, Salesforce’s ability to deliver customer success will be accelerated in countless ways as the world’s number one CRM company would now enable a truly powerful and unified view across all data of a customer. Not only this, the intuitive analytics offered by Tableau will enable millions of Salesforce users and customers to discover actionable and invaluable insights across their organizations.

This planned acquisition of Tableau is a huge premium, especially if you take some time out to consider that the market of data visualization today is a bit crowded.

Primarily, there are two important takeaways from the perspective of Salesforce:

  • Moving forward, data analytics is going to be at the core of its offering.
  • Till now, data visualization as a technology stack was a critical missing layer in the overall analytics game of Salesforce.
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Financial Impact To Salesforce

  • FY20 Revenue: The acquisition is expected to increase the FY20 total revenue of Salesforce by approximately $350 million to $400 million. The FY20 Revenue is now forecasted to be $16.45 billion to $16.65 billion, which will be an increase of 24 to 25 percent year-over-year.
  • FY20 Operating Cash Flow: It is believed that Operating Cash Flow will now be in the range of 21 to 22 percent year-over-year.
  • FY20 non-GAAP operating margin: The acquisition of Tableau is likely to reduce the FY20 non-GAAP operating margin of Salesforce by nearly 75 basis points year-over-year.

The Salesforce-Tableau deal is expected to close during the third quarter of the fiscal year ending 31 October 2019.

How The Tableau Acquisition By Salesforce Will Impact IT?

The recently-announced acquisition announcement of Tableau by Salesforce has left many business owners wondering whether this deal will impact their operations. In a recent statement, Ajay Dubedi, the CEO of Cloud Analogy, remarked, “My first view of this acquisition is that it is wonderful news for the users of Salesforce and less so for the users of Tableau alone. The customers of Salesforce who are yet to use Tableau will be the biggest beneficiaries as a lot of clients prefer a business user-friendly, simple, and easy-to-use tool from a big vendor to avoid additional risk into the mix. However, this risk will be mitigated with Tableau now a part of Salesforce. The fact that Salesforce, the world’s #1 cloud-based software company, has ample resources to invest in development along with a vested interest will make sure that things will not go wrong.”

Dubedi added, “Salesforce is a smart market player and it does not make sense for it to disrupt anything that works well and we all know that Tableau works amazingly well.” The CEO of Cloud Analogy, the world’s most admired Salesforce Development Company, went on to remark that Tableau helps people view and understand data, and Salesforce helps people understand and engage customers. With this acquisition, Salesforce will extend its reach to the on-premises customers of Tableau and even the customers of Tableau who run Tableau analytics on top of SAP or Oracle.

“Therefore, this acquisition is like a match made in heaven as it brings two popular and powerful platforms together that are most likely to complement each other perfectly. Salesforce will now have a huge role to drive digital transformation with Tableau, enabling organizations across the world to easily and effortlessly tap into data across their entire business. This will also help decision-makers access deeper and invaluable insights to drive connected, intelligent customer experience. Moreover, it will also help decision-makers accelerate innovation by making smarter decisions, said the CEO of Cloud Analogy.”

Ripple Effects

Organizations that don’t rely on either Salesforce or Tableau could still suffer as this acquisition deal has the potential of driving independent analytics vendors out of the market.

Today, it would not be wrong to say that the business intelligence (BI) market is highly commoditized with Chief Information Officers preferring to select largely on price. According to market reports, Boris Evelson, the Vice President of Forrester Research, has seen Oracle charging under $5 per user per month for business intelligence in huge enterprise deals while Microsoft has been charging under $4. Coming back to the acquisition and its ripple effects, independent vendors and that is your sole revenue source, you cannot do that.

How New Features May Look Like?

When Salesforce acquired Mulesoft in May last year, it resulted in the unveiling of the Customer 360 omni channel customer communication microservices. The integration of Tableau with Salesforce is expected to give better data visualizations to users. According to media reports, Salesforce that had decided to roll-out Tableau-centric features on its platform is likely to be straightforward for the end users and admins so they can be prevented from being tempted by products from Microsoft.

Ajay Dubedi

Ajay Dubedi

CEO | Founder
"Ajay Dubedi, the founder and CEO of Cloud Analogy, is a prominent Salesforce Sales, Service, and Marketing cloud Consultant with a rich expertise in handling challenging business models. Ajay has assisted and implemented solutions in industries comprising Banking, Health Care, Networking, Education, Telecommunication and Manufacturing. For the last many years, Ajay has been instrumental in passing on his vast knowledge among his colleagues and strongly believes in harnessing an atmosphere of encouragement, empowerment, and mutual advancement. Ajay is globally acclaimed for his extensive experience in APEX Programming, VisualForce pages, Triggers, Workflows, Page Layouts, Roles, Profiles, Reports & Dashboards."

This Post Has 4 Comments

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