Company acquires tiny start-up that built an add-on for purchasing and managing Google-driven Web ad campaigns.
Software provider Salesforce.com Inc. has acquired a tiny four-person start-up Kieden Corp., specializing in paid search technology that created an add-on to its hosted services, which helps customers track sales leads generated with online advertisements for purchasing and managing Google-driven AdWords Web advertising campaigns.
Salesforce.com CEO Marc Benioff and Kieden co-founder Kraig Swensrud detailed the purchase at a press and customer event in Boston.
At a press event in Boston, Marc Benioff, Chairman and CEO of Salesforce.com announced the purchase of Kieden Corp. whose technology is the basis for the new Salesforce for Google Adwords. The product is an on-demand service allowing companies to create, manage and track the effectiveness of their search engine campaigns from all from within Salesforce applications.
Swensrud said that the service, called Salesforce for Google AdWords, lets’ people launch a Google AdWords advertising campaign from a Salesforce.com application.
Kieden's software would help Salesforce's business customers analyze the effectiveness of advertising they place on Google, said Rebecca Wettemann, an analyst with Nucleus Research.
The new service essentially allows marketing and advertising managers to analyze existing campaigns by viewing which people use Google AdWords thereby becoming sales leads. The service can gather together a range of different information, including the amount of sales resulting from Google AdWords clicks and then offer that information to managers through a dashboard interface.
The software works by identifying which keywords attracted Web surfers to click on a particular Google advertisement, and then request product information. It attaches that data to a file that Salesforce software uses to track leads throughout the entire sales cycle -- from initial interest to completed sale.
“This is a big step toward making it clear how much of a return on investment there really is from Google advertising,” Wettemann said.
"The problem...is trying to get information from Google AdWords to knowing who the customer is can be kind of a difficult thing," Benioff said. "You tend to lose the link between CRM (Customer Relationship Management) and Google ads."
Salesforce, the No. 6 provider of customer relationship management software by revenue, is betting that the new offering will help distinguish its product offering from those of competitors including Oracle Corp. and SAP AG, its two largest rivals.
Applications are moving to the Business Web and this product is a perfect example of the sort of innovation that is possible when you embrace the reality that the future of software is on-demand business services, Benioff said.
Benioff said Salesforce will continue to center its efforts on Google Adwords given that Google controls 80 per cent of the market with Yahoo a distant second with 15 per cent and Microsoft even further back at 5 per cent.
The service can be accessed through the AppExchange at www.appexchange.com. Company officials said there are over 300 applications from 200 different companies currently on AppExchange. Since the beginning of this year users of salesforce.com have installed more than 12,000 applications from AppExchange.
Former Kieden employees built the integration between Salesforce.com applications and Google's ad-serving system using AppExchange, the development environment of Salesforce.com.
San Francisco-based Kieden started up in January, had a prototype system running within a few weeks and launched a public beta of the application by May, Swensrud said. They weighed the alternative of downloading Java-based tooling, but found it was slower, he said.
Benioff said that the acquisition validates Salesforce.com's AppExchange strategy of providing open application programming interfaces (APIs) and hosting services to third-party developers. By creating a network of add-on applications, Salesforce.com makes its services more useful to customers--and potentially Salesforce.com itself, he said.
“The strategy of AppExhange is to let 1,000 flowers bloom and look for innovation,” Benioff said. “This is an idea we did not have.”
The service, which will be marketed as "Salesforce for Google AdWords," is available as a free 30-day trial for all Salesforce users. The product will be broadly available sometime during the second half of this year and will cost $300 per organization per month.
Salesforce last week reported better-than-expected fiscal second-quarter earnings and raised its full-year financial forecasts, prompting analysts to say that the company is succeeding in fending off challenges from bigger rivals in the fast-growing market for Web-based business software.
The acquisition brings the operations of Kieden, a four-person operation compared to about 1,600 for Salesforce, with 45 customers, to Salesforce.com.
Both companies are based in San Francisco. Financial terms of the deal were not disclosed.