What Salesforce's Earnings Miss Means for CRM

Creating More Work for Customers Finally Catching Up to Them?

Last week, Salesforce unveiled its latest earnings report, and results disappointed, to say the least. For those who missed it, Salesforce missed revenue expectations for the first time in 18 years. But why? And why should we care? Well, the company, which tags itself with the ticker "CRM," seems to have missed more than just Wall Street's forecasts—we think it's missing the entire point of modern customer relationship management.

What’s Going Wrong

Salesforce’s stumble is more than just a hiccup: it’s a spotlight on the shifting needs of the market, a market Salesforce. When Salesforce started in 1999 the biggest problem was reporting. Salesforce did a good job of providing that visibility. But the biggest problem today facing companies is the scale and productivity of customer relationships. Worker productivity is at historic lows and markets are prioritizing efficiency. Yet, ask any relationship builder whether Salesforce or similar tech makes them more productive, and they’ll laugh at you. 

Salesforce is the gold standard for solving reporting problems. But that very success makes them unable to help with the scale and productivity challenges of today. Here’s why: 

Reason 1: Data Desert

Customers tell us that about 90% of the data crucial for nurturing relationships is nowhere found within computer systems. We're talking about the personal details—the family ties, personal and professional ambitions, intricate company dynamics, and the subtle interplays between stakeholders. And despite the hours salespeople are asked to enter data and update fields in Salesforce, this critical data never makes it into the CRM. 

Early in my sales career, I read the book “How to Swim with the Sharks Without Being Eaten Alive”. The author talks about the Mackay 66 – 66 things that you need to know about each customer. That might seem old-fashioned, but think about how much Google knows about you when they autofill your search, or how much Instagram has on you when they feed you ads. But when it comes to what CRMs hold for us, you won’t find any of that information.

It’s clear that the reason Salesforce can’t effectively help solve the problem of scaling relationships: they can’t. Data entry is the bane of every relationship builder's existence. Salesforce and other CRMs already require too much time inputting what data we do have. Without a complete picture of the customer, CRMs can’t help us manage them. 

Reason 2: The Tyranny of Centralization

Imagine the software equivalent of a dusty old mainframe in a dark, forgotten room compared to the dynamic, personalized experience offered by a smartphone. Salesforce is like the mainframe - centralized, cumbersome, and as flexible as a two-by-four. Want to add a new field? Sure, hang tight a few weeks or months! This is the opposite of empowering users.

If you want to help people scale, the technology must be able to adapt to the individual. However, CRMs cannot provide that level of decentralization. In a world of smartphones, Salesforce is the mainframe– an expensive trap. 

Reason 3: The Stranglehold on Individuality

Now, this might sound philosophical, but bear with me. The traditional CRM model has centered on conformity. It’s a world where deviation isn’t just discouraged, it’s impossible, made rigid by a fixed set of fields, views, and tools. Compliance is king to get CRMs to work. CRMs empower conformity, a future vision that looks like us all talking to an AI named Salesforce (or “Einstein”) that will have a perfect generic conversation with us all. 

But I don’t buy it. I don’t think CRMs are set up to know enough about us to drive individual interactions. Now more than ever, AI needs to help people be people. Scale isn’t conformity and compliance - the beauty of AI-driven scale is it can let people in our organizations be themselves to more and more customers.

Why now?

Don't get me wrong, Salesforce isn’t done yet. You still need to manage a forecast. You still need to assign accounts. Salesforce is still a great choice for that. However, when it comes to addressing the real issues of today—scale and productivity, we need technology that has the data, that is personal, and that enhances the individual. 

That’s why I started the No Data Entry Club to help Sales, Customer Success, and other GTM professionals escape the mundane existence imposed by technologies like Salesforce. Subscribe to get repeatable advice and join the conversation.