Salesforce Enterprise Edition, why $125 per user?

Salesforce Enterprise Edition

I occasionally find myself in meetings where a prospect is evaluating Salesforce. Cost comes up, and they bring up another competitor that is less expensive, or in some cases just plain cheap.  I wanted to investigate this more and understand what the purchaser is looking at, or identify what they are not looking at. I will try to answer some questions and bring awareness to this weekly marketplace conversation.

What makes Salesforce Enterprise Edition worth $125 per user (list price)?

First, let me say that I evaluated the Salesforce Enterprise Edition over Professional Edition because it provides the standard functionality of Workflow, API, Custom Profiles and Record Types which the lesser editions do not have. Second, let me say that purchasing Enterprise Edition doesn’t mean you’re an Enterprise business, it only means you need that level of functionality to run your business operations.

On a side note, the ESB or SMB often wants to purchase Salesforce Enterprise licenses but asks for a lower price for the Enterprise licenses–which will never happen–then they opt for a lesser CRM. This happens often and is not a reflection of Salesforce, but simply makes the point that in order to buy an Enterprise class CRM, you will have to pay the market price. Interestingly enough, because an ESB or SMB buys on shorter terms or lower license counts–a factor in discount pricing, they are more likely to pay closer to the list price than an Enterprise customer that buys in volume or longer terms. But I digress, back to the topic. Hey, I get it and it’s why as a Salesforce Systems Integrator we often work with our ESB and SMB clients post purchase in order to save on implementation costs.

There are many competitors in the “CRM” space nipping at the CRM Cloud that Salesforce built. As an example, I will use this analogy as I’ve done before, the automobile industry. All car manufacturers don’t compete with, or for the same audience. In simplest terms, all cars serve the main purpose, getting you from point A to point B (hopefully successfully). After understanding the idea that there are many factors coming into play that distinguish the car from the buyers. And that is what we want to distinguish here. What within Salesforce separates itself from other CRM providers and in doing so, what is the payment actually attributed to? Please keep in mind, you have many options within Salesforce to choose from, Platform Edition, Chatter Licenses which you can combine with Salesforce Enterprise Edition to drive that the initial cost. For example, you can buy Enterprise and add on Platform or Chatter Licenses but you can’t have Enterprise and Professional Edition. The point is, know your options before you buy just one type.

What does a buyer get with the $125 Salesforce Enterprise license cost?

  • 3 Major releases a year with no hardware upgrades. This is a major factor when distinguishing between other CRM vendors and Salesforce.com. The wealth of new features made available to you throughout a year without paying additional cost for upgrades keeps you current and eliminates downtime. Yes, a hardware solution on premise may appear less expensive but the maintenance of the server and software, together with keeping it updated will directly impact your Total Cost of Ownership (TCO) in a short period of time. It may take you three to four years to prove out the Salesforce investment but hands down, you will do that with less pain.
  • AppExchange – the leading market place for CRM applications where you can find over 2,874 apps and over 3,307,500 installs as of 10/3/15. Boasting 44% Free apps, you have a natural business process improvement playground that is ever growing.

AppExchange 100315

  • Community — Salesforce has over 1.8+ million users, 215 User Groups with Peer-to-Peer, on-demand file sharing. Here, all types of users from Executives to Reps to Admins and Developers collaborate, discuss and support each other.  Find peers and network within in your city or industry and learn best practices from seasoned professionals. You even have the power to help evolve the platform when you have an idea and others vote on it to make it into a release.
  • Training — Trailhead–what an amazing story here–is an interactive, gamification badge and point earning learning experience that allows you to choose which “trail” you want to “head” down to learn. Building off of each module and using a developer environment (DE) you gain hands-on experience with the World’s leading platform, Salesforce.  As an added bonus, you don’t need to be a licensed user to access this training. Sign up for your DE now and start your Trailhead experience right away.

Now, it is easy to say that these all exist for any edition of Salesforce you reside on. This is true but I wanted to illustrate what goes into the pricing in which all users have access to. If you look specifically at Salesforce Enterprise edition with a $125 list price this is how it separates itself from other CRM’s and other editions of Salesforce itself.

These items are included in the base user license of Salesforce Enterprise Edition:
     Integration via Web Services API
     Profiles and page layouts
     Advanced reporting
     Custom websites
     Deal trending** (Salesforce Classic)
     Knowledge read-only
     Record types
     Territory management and sales teams** (Salesforce Classic)
     Visual workflow
     Workflow and approval automation
     Exchange sync

Out of these, it comes down to a handful of crucial items: API, Profiles, Record Types, and Workflow. Any business process needing one of these features automatically needs Salesforce Enterprise Edition. Compared to Professional Edition, common features and functionality (31), Salesforce Enterprise edition gives you 11 more base features and 3 more paid features not available in Professional. In addition, you have one Developer Sandbox, more File Storage (2GB per user) and you can create 10 custom applications versus 5 in Professional.

Salesforce Enterprise Edition

20% or $25 – Community*- Access to Members (1.8+ million) which includes Customers, Salesforce Employees, User Group Leaders, MVP’s, Women in Tech, Administrators and Developers.
16% or $20 – Major Releases*, AppExchange**, Advance Features
12% or $15 – User Groups*
8% or $10 – Developer Sandbox
4% or $5 – Base Features*, Paid Features and Custom Apps*

*Available in all releases
**Because of API, Workflow, APEX (Triggers/Classes), Visual Force, more apps are available

Bonus: Trailhead (Free. World domination has begun!)

In conclusion, someone trying to compare Salesforce Enterprise Edition to an outside CRM can probably identify a 32% – 50% comparison match and then fall short–which is why these CRM’s are cheaper than Salesforce. If that is the case, then we recommend a less expensive edition of Salesforce like Professional Edition to begin, then allow that return organically to grow their business into the Most Popular CRM option available, Salesforce Enterprise Edition.

Note: Some items received a lower weighted price/percentage because they are available in all versions of Salesforce. Community receives the highest score as it is not limited by various editions although available to all. Secondly, Community is an external factor driven by users which are simply awesome every day.

Disclaimer: This is not proven data supporting these percentages or price allocations. This is our hypothesis based on 11 years of Salesforce experience and customer engagement.