Salesforce.com and Google Form Strategic Global Alliance
Two industry leading platforms come together to allow companies to acquire customers, run more efficiently and thrive — Salesforce.com (NYSE: CRM), the market and technology leader in on-demand business services, and Google …
Context & Ripple Effects
This alliance has been telegraphed since at least August 2006, when Salesforce.com shipped a Google marketing tool built on AdWords, and it sharpened into public view in mid-May when the Wall Street Journal reported the two companies were weighing an alliance explicitly framed as a counter to Microsoft. Talks confirmed by the Associated Press that same week have now landed in a formal global partnership announced June 5.
What actually ships today is narrower than the speculation suggested: a first jointly built product (per InfoWorld) and a tight integration of AdWords with Salesforce's ad-sales tracking tools (TechCrunch). Notably, both companies deny the widely expected deep tie between Google Apps and Salesforce's hosted CRM — the alliance is a marketing-and-distribution pact, not yet a platform merger.
First-order effects
- Salesforce customers can now run Google AdWords campaigns and track resulting leads inside Salesforce's on-demand tools, giving Salesforce a search-advertising channel its own stack never had and Google a CRM-side hook into small-business ad spend.
- Microsoft is the named loser in this framing: the two largest on-demand challengers have formalized cooperation against its Office/Dynamics franchise, converting what was loose alignment into a joint product line.
Second-order effects
- Microsoft must respond to a combined salesforce-plus-AdWords pitch aimed squarely at the SMB segment where Dynamics competes — likely by accelerating its own hosted/offline-online hybrid offerings rather than discounting alone.
- Other SaaS vendors face a precedent: distribution deals with Google are now available to rivals, raising the cost of staying standalone and pushing the market toward bundled 'on-demand business services' suites.
Third-order effects
- If the pattern holds, the industry organizes into two poles — web-native application vendors allied around Google's advertising reach versus Microsoft's desktop-installed base — with partnerships, not products, deciding which pole controls customer acquisition.
- The explicit denial of Google Apps–Salesforce CRM integration shows alliance scope is being rationed deliberately; deeper platform coupling remains unconfirmed and would be the real structural event if it ever comes.
The trend: On-demand software vendors are consolidating into advertising-backed alliances against Microsoft, with Google's ad network serving as the distribution layer for third-party business applications.