Salesforce, its partners, and its customers will all feel the absence of its massive, in-person extravaganza this year, experts say: ‘The Dreamforce void will hurt’ (CRM)

  • Salesforce’s annual Dreamforce conference is usually one of the most anticipated tech conferences of the year, but it will be quite different in 2020 because of the coronavirus pandemic.
  • In April, Salesforce cancelled all in-person events for the rest of 2020 in favor of virtual gatherings. It has yet to announce any new information about what a virtual Dreamforce event would look like this year.
  • Not having an in-person Dreamforce will have widespread effects on the company and its ecosystem of partners and customers, Salesforce analysts and partners told Business Insider.
  • For example, some expect to see long-term effects on the business because it will take longer to build a pipeline of new business leads, both for Salesforce and its partners.
  • However, others are more optimistic given Salesforce’s track record with maintaining its network virtually and how it is changing its relationships with customers.
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Salesforce’s flashy, star-studded annual Dreamforce conference is usually one of the most anticipated tech conferences each year. Thousands of attendees pour into downtown San Francisco each fall to hear from Salesforce executives, partners, and customers alongside high profile speakers (like President Barack Obama in 2019) and performers (like Metallica in 2018). However, this year things will be quite different.

In April, Salesforce cancelled all in-person events for the rest of 2020 and said it would “reimagine” them in “in new and virtual ways.” Salesforce has yet to announce any new information about what a virtual Dreamforce event would look like this year.

CEO Marc Benioff did make it clear during the company’s earnings call in August that no one will be getting together live.

“There is no Dreamforce in 2020,” he said. “We know that. We’re not all heading to San Francisco next month, where Metallica is not playing. We’re not all going to be going in the keynote room.”

It’s still unclear what this means for a virtual Dreamforce event happening this year but a Salesforce spokesperson told Business Insider: “In the coming weeks, we’ll share news about our completely reimagined Dreamforce for the all-digital, work anywhere world.” Salesforce also said “over the past months we’ve had more than 140 million views of our various virtual events.”

Regardless of whether there is a virtual event, not having an in-person Dreamforce will have widespread effects on the company and its ecosystem of partners and customers, Salesforce analysts and partners told Business Insider. Some expect to see long-term, potentially negative effects on the business, while others are more optimistic given Salesforce’s efforts to maintain its ecosystem virtually.

Salesforce could seen an impact on its customer momentum and sales pipeline

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Joe Williams

Many tech conferences serve as an important generator of new business, and Dreamforce is no exception. While it is still possible to throw events virtually and connect with customers, it doesn’t fully replicate the spontaneity and liveliness of an in person event, analysts and partners said.

While more people are able to attend virtual talks — which means that a virtual conference may get more engagement — it’s harder to replicate the networking aspects that happen in a shared space, said Rishi Jaluria, an analyst at D.A. Davidson. And that networking tends to drive new business both for Salesforce and its partners.

“There’s kind of that ‘flywheel effect’ you get from your customers talking with each other: That helps drive more usage,” Jaluria said. Virtual tech conferences that he’s attended this year haven’t been able to replicate that type of environment, he said, so he worries that Salesforce will see lower customer momentum due to a lack of in-person events.

After all, Dreamforce is all about showcasing Salesforce’s broader vision and reinforcing people’s confidence in investing in its products, said Ian Gotts, CEO at Elements.Cloud, a Salesforce partner company that helps implement cloud software. The key with Dreamforce is that it gets executives in the same room with Salesforce’s leadership, and that atmosphere is harder to replicate online, he added.

“Without that sort of event it takes a lot longer to get deals closed,” Gotts said. “You’ve got to sit down with the business case. You’ve got to work with every single customer” — as opposed to having everyone in the same room at the same time, he said.

At this point, any theory about how it could affect Salesforce is still just a theory because there’s still so much uncertainty, said Baird analyst Rob Oliver. For example, even if the engagement level is different at virtual conferences, there’s not enough prior data to predict the effect.

“What does that mean for pipeline generation? I think that is still an unanswered question,” said Oliver. “We are still too early in the pandemic to be able to say how that will play out.” He does think that many more people are able to attend virtual events than in-person events, which is promising.

Jaluria thinks there will be some disruption to Salesforce’s customer pipeline but that the firm likely won’t see those effects for a while.

This problem isn’t unique to Salesforce: All tech companies are going through this right now. However, Salesforce’s approach to conferences is unique because it has created a strong ecosystem of partners and customers that all rely upon each other and are core to its business. And Dreamforce is where that all gets displayed.

There could also be disruption to the Salesforce ecosystem

Salesforce’s partners also rely on Dreamforce to drive new business leads. OwnBackup — a Salesforce partner focused on cloud data backups — has sponsored many Salesforce events over the past five years because it would always win a lot of customer prospects from those events, its chief marketing officer Jamie Grenney said.

“Everyone in the room when they throw Salesforce events, that is a potential prospect for us, a potential customer for us,” he said. The company had created its sales playbook around these events, so when in-person events were cancelled, OwnBackup had to rethink its entire go-to-market strategy.

The cancellation will also affect the “army of admins, consultants, developers” in and around Salesforce, said Gotts. Dreamforce is an opportunity each year for them to skill-up and make connections, and some element of that is lost when everything has moved online, he added.

However, Salesforce might be more readily prepared than other companies to bounce back from these setbacks. Its Trailhead online learning platform helps support and sustain its ecosystem even when people can’t meet in person, said Rebecca Wettemann, an analyst at Valoir.

“Lack of customer events is a challenge for all vendors right now — the difference for Salesforce is they’ve built a community of customers with Trailhead long before the pandemic,” Wettemann said. “While the Dreamforce void will hurt, Salesforce already had a vibrant virtual customer community in place, putting them leaps ahead of others.”

Salesforce also has done many smaller virtual events — like its Leading Through Change series — since the pandemic began. While it’s unclear how that’s impacting and benefiting the overall business, it’s part of how Salesforce is adapting to the current situation.

Overall Salesforce is reimagining “the way we engage with our customers in completely new ways,” COO Bret Taylor said on the company’s earnings call last month, in response to analyst questions about how the customer pipeline would be affected without Dreamforce.

As for how partners are affected, Grenney from OwnBackup said that ultimately these changes will force his company and others to become more resilient and create new avenues to generate business.

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