A LAST WORD: WHY SALESFORCE ACQUIRED DEMANDWARE
With Salesforce’s acquisition of Boston’s Demandware, eCommerce investments may heat up, again. Demandware ($2.94B market cap) was purchased for 2.8B today. By comparison, Shopify was trading at a volume that placed their market cap at $2.52B. Shopify has ~300,000 merchants and Demandware has 349 merchants. In this instance, it’s not the quantity that counts. It’s the (revenue-generating) prowess of vendors. Salesforce’s services are not cheap.
According to Rare.io‘s Taylor Sicard, the average Shopify merchant sold $8,500 in 2015 while Demandware serves over 30 merchants that are generating $100M+ per year.
Demandware is the provider of e-commerce technology to 52 retailers in the Top 500 and 18 in the Second 500, according to Top500Guide.com. Demandware clients include L Brands, the parent company of Victoria’s Secret and No. 28 in the Internet Retailer Top 500, L.L. Bean (No. 34), Lands’ End (No. 44), Nike Inc. (No. 47) and Abercrombie & Fitch (No. 58). Salesforce is listed as the provider of customer relationship management (CRM) software for just one retailer in the Top 500, Coach Inc. (No. 163).** (via Internet Retailer)
With eCommerce emerging as a dominant force in American retail, it should not be surprising that there are shifts in the CRM space. This move by Salesforce gives them a new opportunity to attract dozens of new vendors to its CRM (from the Demandware platform), giving them a strategic advantage over competing CRM NetSuite, who has but two clients in the eCommerce top 500 and 19 in the top 1000.
See more of the issue here.