Introduction
After attending SAP’s flagship conference a few months ago, I left intrigued on the new pitch SAP made to everyone who attended the conference. There is usually something to entice people with the latest and greatest thing us technologist have to have. Basically, generating more sales for SAP. It was S/4 HANA, then Leonardo, and now something called C/4 HANA. It is the tech giant’s attempt to enhance the digital experience, get to know the customer better, and directly compete against Salesforce in the CRM space. The “C” stands for customer and the “4” stands for 4th generation. SAP isn’t the greatest when naming its tools and they keep changing acronyms every couple months; however, this aligns with the rest of the HANA platform. C/4 HANA is a rebranding of Hybris and the newly acquired Callidus Cloud technologies to provide a holistic customer experience.
In the press release announcing C/4 HANA, Bill McDermott, SAP CEO, says, “SAP was the last to accept the status quo of CRM and is now the first to change it. The legacy CRM systems are all about sales; SAP C/4 HANA is all about the customer.” Really? SAP CRM was the legacy provider and generally behind the status quo. They must have conveniently forgot they were the flagship CRM provider with SAP CRM. It was the go to CRM application until Siebel and ultimately Salesforce came along and disrupted the whole industry with cloud computing and a no code approach to SaaS. SAP then followed up with CRM on Demand and C4C.
With all that aside, McDermott is correct. CRM systems are more than just sales force automation, but technologies that help business have a single view of the customer. The more we understand our customers through their behavior, orders, people, etc, the better we can service them which ultimately leads to a better relationship and more revenue.
The following does a side by side comparison of both SAP C/4 HANA and Salesforce. It would be impossible to compare everything apples to apples, but I focused on high level functionality and provided a very simplistic view for understanding purposes. Each application is broken into four major clouds: Marketing, Commerce, Sales and Service. There is an underlying data layer or “Platform” for each application that serves as the base layer for each cloud along with the capability of extending the functionality beyond what each cloud offers.
Marketing Cloud
The current version of SAP Marketing Cloud is similar to salesforce’s Pardot. Both do a very good job on tracking customer behavior, campaign management, and leveraging machine-based learning for smarter lead nurturing.
However, Salesforce Marketing Cloud is more than just Pardot. They have provided other features in Journey Builder, Social Studio and Advertising Studio that brings together commerce, sales and service powered by Einstein, artificial intelligence software, that uses hundreds of millions of data points to track consumer behavior. For example, a marketer can automatically turn off advertising of a specific product to a customer if a service request has been put in. There is nothing more irritating than having a promotion flash in front of you on how amazing the product is when you just had an issue with it. Salesforce Marketing Cloud allows you to consolidate all social media content about your brand and create service tickets real time to address issues people are posting. Mobile Studio uses location-based technologies and allows you to deliver mobile messages alongside email, ads, and web campaigns to create a consistent customer journey across every channel.
As of today (Aug 2018), only campaign management leverages SAP Leonardo. On the roadmap SAP will further that capability to Lead Conversion Propensity and Customer Retention. One highlight for SAP Marketing Cloud is the Agency Collaboration. It enables customers and marketing agencies to collaborate on marketing activities. You can hand over the keys to the castle for all marketing activities in your system or allow agencies access to a portion.
Advantage: Salesforce
Commerce Cloud
Though Salesforce Commerce Cloud is a visionary leader for eCommerce in its ease to install, easy to manage and simple licensing, it isn’t truly comparable to the vast capabilities of SAP Commerce Cloud. Salesforce made a push for relevance in the commerce space in 2018 with the purchase of CloudCraze. It gives consumers a personalized shopping journey through multiple channels including web, mobile, social and in-store. However, CloudCraze and Salesforce Commerce Cloud are built on two different platforms and since this is a new acquisition, the roadmap of integration is still unclear. Additionally, the Commerce Cloud is a one size fits all approach to any industry. This could require additional investments in customizations or partner channel components to fit one’s business model.
The SAP Commerce Cloud (previous known as Hybris) as been the leader in the B2B space for nearly a decade. It was named the best commerce platform for 2018 according to the Gartner (magic quadrant below). The industry accelerators, comprising layouts and customer journey templates can get customers up and running very quickly. The most significant differentiator is the integration across the C/4 HANA platform. A customer can review their price lists, analyze inventory levels and see order document flows from S/4 HANA in SAP Commerce Cloud in real time without middleware or custom integration. It brings your ERP system to the customer. Additionally, customer service can easily assist customer with issues by having the ability to emulate the customer’s cart and finish off purchases.
Advantage: SAP
Sales Cloud
Although Salesforce and SAP offer similar functionality in this area, SAP’s integration to S/4 HANA gives it a slight competitive edge. The main selling point for the SAP C/4 Sales Cloud is bringing ERP data through to CRM. No need for middleware or integration. Seamlessly connect customer order information, document flow and invoicing into SAP Sales Cloud. This can be done with Salesforce but does require additional adapters to be configured or developed.
SAP has made strides in improving the functionality and user interface, but still have some ways to go. Along with the integration, SAP Sales Cloud has native features for Leonardo backed account scoring, mapping and route optimization, real time inventory availability (roadmap for Q3 2018) and, with the CallidusCloud acquisition, a very robust sales person compensation engine.
The Salesforce Sales Cloud is the crux of the salesforce platform and clear industry leader and stays the leader in the Gartner Magic Quadrant for sales automation for the 12th year in a row. It is important to look at Salesforce Sales Cloud as more than just a sales automation tool, but a platform for business visibility and collaboration. It is easy for a non-technical user to extend the application functionality to address workflow and approval processes throughout the organization. It is possible to do in the SAP Sales Cloud, but very cumbersome and clunky.
Additionally, Salesforce reinvented its user interface with the Lightning Experience. They built the interface from the ground up having mobile in mind with feedback from thousands of customers. It enables salespeople to work smarter and faster. Everything important for the salesperson is at their fingertips. For example, the Kanban view for list. A salesperson can update their Opportunity Pipeline by dragging it from one stage to another. With the SAP Sales Cloud user interface, there were too many tabs and clicks to get to the information the user really needed. The salesforce user experience is far better and more intuitive than the SAP Sales Cloud. The user experience is what drives adoption and should be kept in mind when reviewing CRM options.
The Salesforce mobile experience was designed for the phone and the main emphasis was how many functions can a person do with the swipe of a thumb. Salesforce also optimized the interface for the Apple watch. SAP Sales Cloud mobile platform is very similar to the web platform with too many tiny clicks to get information. It is not efficient and cumbersome for people on the road.
Advantage: Push
Service Cloud
The functionality between SAP Service Cloud and Salesforce Service Cloud is very similar. The former focusing more on field service requests and the latter focusing on a traditional call center support. Both provide machine learning for service tickets, knowledge management and smart routing through telephony integration.
The same advantages for each application like above with SAP Service Cloud seamlessly integrated with the back office for invoicing and credits while Salesforce Service Cloud provides the user convenient widgets to address customers very quickly.
Advantage: Push
Ecosystem
When I was at an age where marriage was top of mind for my family, my dad sat me down and ran through important qualities for my spouse to have. Like all dads, he was providing me decades of wisdom. As Indians the most important part of marriage he conveyed is “you aren’t just marrying the girl, but the whole family.” Oh so true of technology. Just like the Google vs Apple vs Amazon, you are not choosing a technology, but an ecosystem.
Solution Implementation Partners
Both SAP and Salesforce have a vast partner network with Salesforce probably a slight edge on volume of solution implementation (SI) partners due to reduced barriers to entry. However, there is a significant difference between approaching ERP implementations and CRM implementations. With ERP implementations, they are very well defined because at the end of the day the numbers must be correct. SI’s are gathering requirements from Operations and Finance people. ERP implementations take at least a year to 18 months…and those are considered the fast ones.
A CRM implementation approach is vastly different. The primary stakeholders are Sales and Marketing from the onset. To get solid requirements from a sales person is a near impossible task. Generally, requirements are vague and broad. “Give me all the information and let me decide what I want to use and when.” Even after requirements and development, there needs some course correction. “I know you did exactly what I asked, but now that I see it, can we change things around.” The ERP SI’s don’t handle this well and change request run about; however, with salesforce SI’s, this is run of the mill project delivery.
With that said, if SAP is relying on its SI’s to deliver C/4, I haven’t seen the robust change in approach, resource and organizational change from its major SI’s. SAP has introduced a great technology, but it will take a bit of time for the partner network to really figure out on how to implement it.
Marketplace
Both technologies do have a wide array of product offerings in their respective marketplaces; however, the Salesforce marketplace, as known as the AppExchange, has a plethora of free and paid applications to meet every need a business has. Just like the iPhone, if you feel like there is something missing in your salesforce instance, trust me, there is an app for that.
Customer Support
Gartner cited in a report: “Salesforce customers see the vendor not just as a CRM software provider, but as a strategic advisor on how to innovate and grow their business overall. This is a rare position of trust that very few competitors can match.” For SAP, they will eventually solve the issue, but it takes a bit more effort to get to the right person, a bit more time and sometimes the code fix will break something else. As of today, the SAP CRM technical documentation is light and isn’t readily available for all modules.
The training Salesforce provides through its Trailhead is remarkably well done. Salesforce takes novice user through each function and has users build demos. It is a clearly thought out and well executed plan to educate users on how to become a salesforce expert. You don’t have to be technically inclined to be a proficient administrator in Salesforce. Users can earn badges as they work their way through each learning path.
Aside from the responsive customer service organization, salesforce has a vast community that has formed to help anyone in the salesforce community. People take pride on the gamification aspect of support and serves as the first resource of support.
Advantage: Salesforce
Cost
It is already interesting when you try to compare pricing. Salesforce keeps it confusing on purpose, but SAP takes it to a whole new level when it comes to pricing. Again, it won’t be an apples to apples comparison and this is just list pricing. These can be negotiated in the right circumstances. I am only comparing the middle tier pricing for both offers because that can get you most of what a business needs.
Salesforce:
Essentials — $25/user/month — this gets you access to the platforms and ability to work with custom objects. No opportunity access
Enterprise Sales Cloud — $150/user/month
Commerce Cloud — revenue-based subscription model
SAP:
Sales Cloud — $117/user/month
Commerce Cloud — fixed and consumption subscription model (based on the number of orders)
Summary and Conclusion
Here is a high-level pros and cons for each application:
It is hard to determine a clear-cut winner because the way both companies have dedicated themselves to innovation and advancement of their products, their deficiencies will be addressed by the time I complete this document. For example, we will see what salesforce does with the Mulesoft acquisition and have a seamless connector to any back office system. The choice between technologies depends on the situation, business requirements, and the ecosystem for each organization.
There is a compelling argument to choose SAP CRM because of the seamless integration with the back-office processes. This allows for a complete solution without data being migrated back and forth between systems. The 4th attempt…I mean 4th generation CRM product from SAP finally hits the mark of what a CRM should be instead of just an afterthought. If companies want to reduce the technology footprint and are implementing S/4 HANA for ERP, the C/4 solution is a viable option.
In a technology innovation fight, it is hard not to back the company that has been in the top 3 of Forbes “Most Innovative Company” for the last 8 years. Salesforce dominates the market for customer-relationship software. The company had 19.6 percent of the market in 2017, according to industry research firm IDC. Oracle was №2 with 7.1 percent, and SAP had 6.5 percent. The way salesforce’s revenues have been growing, they don’t show signs of slowing down anytime soon. If you already have Salesforce implemented with the integrations to an ERP system, then it makes sense to stick with the current technology stack. The business case or ROI on just changing technologies for the sake of change isn’t a very compelling sell for executives. The SAP C/4 functionality and what SAP has on their roadmap isn’t persuasive enough to replace an existing salesforce solution.
It will be interesting to see how both companies compete against each other. SAP will invest a significant amount of capital and resources to keep enhancing and have C/4 on par with the rest of the HANA platform. Salesforce is a CRM company, and this is their only focus. The winner is the end consumer, who will benefit from the rapid innovation and addition of features to the overall delivery.
Sameer is a technology executive focused on helping businesses with digital transformations. Skilled in Business Process Improvement, Sales Efficiency, Analytics, Customer Relationship Management (CRM), and Enterprise Resource Planning (ERP).
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