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Category: EnterpriseCustomer

EnterpriseCustomer

  • Michael Dell Predicts in 10 Years More Computed Data on the Edge Than Cloud

    Michael Dell Predicts in 10 Years More Computed Data on the Edge Than Cloud

    “The surprise outcome ten years from now is there’ll be something much bigger than the private cloud and the public cloud,” says Dell Technologies CEO Michael Dell. “It’s the edge. I actually think there will be way more computed data on the edge in ten years than any of the derivatives of cloud that we want to talk about. That’s the ten-year prediction.”

    Michael Dell, Chairman and CEO of Dell Technologies, discusses how it has become a critical technology platform for its customers in an interview with theCUBE at Dell Technology World 2019 in Las Vegas:

    Data Has Always Been at the Center of How the Technology Industry Works

    We feel great. Our business has really grown tremendously. All the things we’ve been doing have been resonating with customers. We’ve been able to restore the origins of the entrepreneurial dream and success of the company and reintroduce innovation and risk-taking into a now $91 billion company growing at double digits last year. Certainly, the set of capabilities that we’ve been able to build organically and inorganically, with the set of alliances we have, the trust that customers have given us, we are super happy about the position that we’re in and the opportunities going forward. I think all this is really just a pregame show to what’s ahead for our industry and for the role that technology is going to play in the world.

    Data has always been at the center of how the technology industry works. Now we just have a tsunami, an explosion of data. Of course, now we have this new computer science that allows us to reason over the data in real time and create much better results and outcomes. That combined with the computing power all organizations have to reimagine themselves given all these technologies. Certainly, the infrastructure requirements in terms of the network, the storage, that compute, the build-out on the edge, tons of new requirements, we’re super well-positioned to go address all that.

    Predicts in 10 Years More Computed Data on the Edge Than Cloud

    The surprise outcome ten years from now is there’ll be something much bigger than the private cloud and the public cloud. It’s the edge. I actually think there will be way more computed data on the edge in ten years than any of the derivatives of cloud that we want to talk about. That’s the ten-year prediction. That’s what I see. Maybe nobody’s predicting that just yet, but let’s come back in ten years and see what it looks like.

    Really what we’re doing is we’re bringing to customers all the resources they need to operate in the hybrid multi-cloud world. First, you have to recognize that the workloads want to move around. To say that they’re all going to be here or there is in some sense missing the point because they’re going to move back and forth. You’ve got regulation, cost, security, performance, latency, all sorts of new requirements that are coming at you and they’re not going to just sit in one place.

    This is All Super Important As We Enter This AI Enabled Age

    Now with the VMware cloud foundation, we have the ability to move these workloads seamlessly across now essentially all the public clouds. We have 4,200 partners out there, infrastructure on-premise built and tuned specifically for the VMware platform and empowered also for the edge. All of this together is the Dell Technologies cloud. We have obviously great capabilities from our Dell UMC infrastructure solutions and all the great innovations at VMware coming together.

    Inside the business, the first priority was to get each of the individual pieces working well. But then we saw that the real opportunity was in the seams and how we could more deeply integrate all the aspects of what we’re doing together. You saw that on stage you know in vivid form yesterday with Pat and Jeff and Satya and even more today. Of course, there’s more to do. There’s always more to do. We’re working on how we build a data platform bringing together all of our capabilities with Boomi and Data Protection and VMware. This is all going to be super important as we enter this AI enabled age of the future.

    We’ve Created an Incredible Business

    I think investors are increasingly understanding that we’ve created an incredible business here. Certainly, if we look at the additional coverage that we have as they’re understanding the business, some of the analysts are starting to say hey this doesn’t really feel like a conglomerate. It’s a direct quote. If you think about what we demonstrated today and yesterday and will demonstrate in the future we’re not like Berkshire Hathaway. This is not a railroad that owns a chain of restaurants. This is one integrated business that fits together incredibly well and it’s generating substantial cash flows.

    I think investors over time are figuring out the value that’s intrinsic to the overall Dell Technologies family. We’ve got lots of ways to invest, we got VMware, SecureWorks, Pivotal, and of course the overall Dell Technologies.

    Michael Dell Predicts in 10 Years More Computed Data on the Edge Than Cloud


  • SAP CEO: We’re the Fastest Growing Cloud Company In the Enterprise Software Space

    SAP CEO: We’re the Fastest Growing Cloud Company In the Enterprise Software Space

    “We’re the fastest growing cloud company in the enterprise software space,” says SAP CEO Bill McDermott. “We grew total revenue by 16% and grew cloud 48%. Let me just put this on the line. When you grow cloud 48%, that’s 80% faster than Salesforce, that’s 30% faster than Workday. So when you have a franchise that’s growing your core business in double digits, the cloud faster than anybody out there, and you’re progressing the margin one point per year between now and 2023.”

    Bill McDermott, CEO of SAP, discusses SAP’s amazing growth over the last quarter, especially in cloud, in an interview on CNBC:

    Fastest Growing Cloud Company In the Enterprise Software Space

    This is a good start to the year. It’s what the capital markets have been waiting for. They’ve been getting all kinds of revenue growth. We’re the fastest growing cloud company in the enterprise software space. They wanted to see the multiples on the margin. As we raised our full-year guidance we committed to improving the operating margins by one point per year for the next five years. Now after a $75 billion investment in innovation for our customers, our shareholders are saying wow, this is the moment I get the multiples on the margin and therefore the leverage in the share price.

    Our cloud gross margins can improve to 75% between now and 2023. We’re hiring the absolute very best people in the world in artificial intelligence, machine learning, big data, all the areas that our customers want us to go. It’s not the number of people, it’s getting the absolute very best people. If you hire right, you manage your cloud gross margins right, and you have a highly inspired customer base where you’re growing with high renewal rates, you get tremendous leverage on the operating margin.

    The Company Really Is On a Roll

    What we’re doing is when we did restructure, and that was announced in Q4 and we executed it in Q1, we basically said we’re going to take about 4,400 people from areas that were not part of the new economy and hire to those tremendous standards. We’re bringing in the best data scientists in the world, best machine learning individuals out there, best enterprise application software coders around the world, and we’re developing in China, Israel, the United States, and in Europe. The company really is on a roll.

    We’re almost done (with the restructuring) in the sense that we accounted for most all of it in Q1. We are finishing it up in the next quarter right now. For example, it’s being executed in Germany, but the majority of it has been handled. The stock today (is way up). We grew total revenue by 16% and grew cloud 48%. Let me just put this on the line. When you grow cloud 48%, that’s 80% faster than Salesforce.com, that’s 30% faster than Workday. So when you have a franchise that’s growing your core business in double digits, the cloud faster than anybody out there, and you’re progressing the margin one point per year between now and 2023, I think that’s why the shareholders have the stock up 8%.

    What’s On My Mind is Where the Customer Needs Us To Go

    All competition is on my mind. But what’s really on my mind is where the customer needs us to go. We weren’t losing to them. What the shareholders wanted, and we surveyed them, we had a capital market stay in New York and we used Qualtrics to survey them, they said we love your revenue growth we know you’re gaining share we just want more operating margin leverage out of the company. That’s what we gave them this quarter. It took us ten years and $75 billion in R&D and M&A to get to the point now where we have everything we need. We don’t need to do any more big M&A, we just need to perform well and spin-off margin and free cash flow for our shareholders and the stock goes on a run.

    They (our customers) know we’ve given them so much innovation. It’s coming at them so fast that now they’re saying help me integrate it, help me fully leverage it across the enterprise and get the value from it. Interestingly, the customers and the shareholders are both in the same place. They’re saying you’ve done unreal things, now let’s dig in and drive real value from all the things that you’ve done. We bought an $8.3 billion dollar company called Qualtrics. We now took over a new category called experience management where we can actually tell the consumer experience inside or outside the company in real time. We have data now.

    So think about this, if you’re running a company and you want to recruit to retire process in your company, how do my people feel when I recruit them? How did I feel when I trained them? Am I coaching them? Am I teaching them? Am I giving them everything they need in their compensation plan? We know this all now in real time with the Hana database built into the human capital management process. We do things that no other company can do.

    SAP CEO: Were the Fastest Growing Cloud Company In the Enterprise Software Space


  • Salesforce CEO: Every B2B and B2C Company Is Becoming a B2B2C Company

    Salesforce CEO: Every B2B and B2C Company Is Becoming a B2B2C Company

    Salesforce co-CEO Marc Benioff says that every company is becoming a B2B2C company. “Every B2B company and B2C company is becoming a B2B2C company,” says Benioff. “What company does not have to directly connect with the consumer? You could be a traditional industrial company who’s selling to B2B resellers and you have to be ready in this connected digital revolution to be able to connect directly to your consumer as well.”

    Marc Benioff, co-CEO of Salesforce, discusses their recent high flying quarterly results and talks about how every company is becoming a B2B2C company in an interview with Jim Cramer on CNBC:

    We Just Had a Fantastic Fourth Quarter

    We just had a fantastic fourth quarter. We’re taking a look at those numbers right now and it was an amazing quarter. In fact, we beat our revenue estimates quite handily. As part of that, our co-CEO Keith Block closed the largest transaction in our history and the largest transaction ever in Barclays history. It was a deep nine digit transaction to help automate their 50 million customers. It really goes to show how the three major trends that are playing out in computing today, the cloud, broad digital transformation, and a focus on the customer, can really impact our company by creating a huge deal and also being able to support a huge transformation at Barclays.

    I feel great about our business. I’ve always felt great about it. We’re coming up on our 20 year anniversary this Friday. It’s been 20 years that have been unbelievable to us here. We are coming up on a year that we’re going to do $16 billion in revenue that far exceeds my expectation. I still have never been more excited about Salesforce than I am right now. When I look at the short term I see $20 billion right around the quarter and I see $30 billion right around the corner. In fact, we initiated a four-year guidance today of $26 to $28 billion.

    Every B2B and B2C Company Is Becoming a B2B2C Company

    You can look at a great deal that we did this quarter with Amgen, a tremendous biotechnology company. This is a company that’s really expanding with our health cloud. This is our vertical strategy to build products specifically for certain industries. In this case, our health cloud is going to help Amgen connect with their customers in a whole new way.  Every B2B company and B2C company is becoming a B2B2C company. What company does not have to directly connect with the consumer?

    Not just Amgen, everybody. You could be a traditional industrial company who’s selling to B2B resellers and you have to be ready in this connected digital revolution to be able to connect directly to your consumer as well. That’s a major trend that we’ve benefited from for so many years now and you’re going to see that continue to play out. That’s certainly something driving this relationship with Amgen as well.

    Brunello Cucinelli and Lamborghini Using Salesforce to Connect

    Brunello Cucinelli is one of the great fashion brands in the world and we’ve completely transformed Brunello Cucinelli. He actually touches the customer in many different forms. He has a direct B2C relationship. He’s online with them. We run his website. You go into his stores. That’s a direct consumer connection. But did you know he’s a B2B company also? That’s because he’s selling to resellers who are reselling his products in some of the big retail stores around the world. He’s a B2B and a B2C company. We have to bring it all together with him and give him a single view of his customer. That’s the transformation he has to go through and has gone through and that’s why he’s had such great growth and we’re so excited for him.

    Another great example is Lamborghini. Of course, Lamborghini is actually traditionally a B2B type company. They’re selling to their dealers and they’re making sure their dealers are successful. some of those dealers are not even owned by Lamborghini but now they need to be able to connect with their customer in real time, all the time. They’re also a B2C direct customer. That’s why the new Urus, their new SUV, is built entirely on Salesforce. It’s the connected Lamborghini. That’s a vision for all car companies in the future that they can directly connect with you, not just connect with their dealer. That’s the B2C and B2B transformation that we’re talking about.


  • Yext Delivers a New Paradigm in Search, Says CEO

    Yext Delivers a New Paradigm in Search, Says CEO

    “Search has changed,” says Howard Lerman, CEO of Yext. “It used to all be about websites where you’d type in a keyword and you get ten blue links back on a page. Today, when you search you just get an answer. The companies that put answers out there from them are the ones that are going to win in this massive paradigm shift.”

    Howard Lerman, CEO of Yext, discusses how Yext helps businesses adapt to the new paradigm in search by inserting brand verified answers into all the major search platforms in an interview with Jim Cramer on CNBC:

    Yext Delivers a New Paradigm in Search

    Taco Bell with they’re 7,000 stores is a partner of Yext. But we don’t just partner with food companies. We added 350 new enterprise logos last year with 128 and Q4 alone. That’s nearly one logo per day. We live in an era of too much information and much of it is wrong. In this era of too much information, Yext delivers a new paradigm in search that enables consumers to get brand verified answers on all the major search platforms like Siri and Google and Alexa even the Chinese search engine Baidu.

    So the overseas tourists from China that come and go to luxury brands or need to eat can find information or they can find facts in Mandarin. They don’t use Google when they come to the United States.

    The Ultimate Authority on a Business is the Business Itself

    Morgan Stanley has over 14,000 Wealth Advisors. They all use the Yext platform to manage all the facts about every one of their advisers. They can log in, update their photo, they can say whether their a CFP and what languages they speak. They put it into Yext and boom it’s updated everywhere. We stand for the truth. The ultimate authority on Old Navy, the ultimate authority on Taco Bell, the ultimate authority on Morgan Stanley or New York Presbyterian Health is the business itself.

    So when you look up a doctor and you’re looking up a doctor that treats certain conditions and accepts certain insurances you need to make sure that you get the right answer. The ultimate authority on the doctor is from the hospital and the doctor itself. That’s what Yext stands for. We put customers, the brand itself, with brand verified answers in all these different services. Every customer journey starts with a question and when you use Yext your customers can get a brand verified answer.

    Companies That Put Answers Out There Are Going to Win

    Yext Brain is an extension of Yext that lets customers create any type of entity they want with custom objects in their platform. They can publish events. They can publish menus. They can publish products. If you’re in the financial services industry you can publish a credit card. These are all new types of entities that companies can put into Yext to deliver answers to their customer at that exact moment of intent. Search has changed. It used to all be about websites where you’d type in a keyword and you get ten blue links back on a page. Today, when you search you just get an answer. The companies that put answers out there from them are the ones that are going to win in this massive paradigm shift.

    Does Wendy’s have gluten-free menu items? Do they have vegetarian items? How many calories are in a Whopper? How many calories are in a Big Mac? What about the new Burger King Impossible Burger. These are the types of questions people ask. The number one question someone asks when they visit New York Presbyterian health, that’s one of our customers, is they want to find a doctor that can treat their condition, that accepts their insurance, and is near them. If New York Presbyterian Health can’t answer that question the consumer is going to go ask the question to a different provider.

    Yext Delivers a New Paradigm in Search, Says CEO


  • Text Conversations Build Customer Relationships, Says Twilio CEO

    Text Conversations Build Customer Relationships, Says Twilio CEO

    “We are starting to see companies where not only can they text you but you can text them,” says Twilio CEO Jeff Lawson. “That’s the nature of a conversation. That’s how you build relationships over time. It’s two way. The leading companies are figuring out that actually if you create this dialogue it creates great customer relationships and ultimately creates loyalty with customers. They feel connected to you.”

    Jeff Lawson, CEO of Twilio, discusses on CNBC how texting has evolved to two-way communications with customers which is helping drive loyalty and growth. 

    Every Company Should Build Great Digital Experiences To Compete

    Focusing on customers and focusing on growth is the only way you can (hit a billion-dollar run rate). That’s the only way you can do it. I remember talking to the company several years ago when we crossed the $100 million run rate. I pointed to the billion-dollar number and said this is a market and this is a company that can be one of the rare companies that can graduate from the $100 million status to the $1 billion status.

    I’m really proud of what we’ve accomplished. But every step of the way all you can do is focus on customers and continue to be attached to a secular trend. That trend is every company out there needing to focus on building great digital experiences for their customers in order to compete in the modern economy. That’s what we do.

    Text Conversations Build B2B Relationships

    We just launched a new product a couple months ago called Conversations. It’s not uncommon today, but a few years ago it was novel when a company could text you. Maybe a table is ready for a restaurant or your flight is boarding. Any of those kinds of things. Several years ago that was amazing. And we luckily power a lot of those companies. 

    Nowadays, we are starting to see companies where not only can they text you but you can text them. That’s the nature of a conversation. That’s how you build relationships over time. It’s two way. The leading companies are figuring out that actually if your create this dialogue it creates great customer relationships and ultimately creates loyalty with customers when they feel connected to you. 

    Text Messages Are Just The Beginning

    Think about Tesla. Tesla’s a company where you can text the service manager. Your car is in service and they might try to call you your phone rings and when you don’t know the number you don’t answer it. Now they can text you and tell you what needs fixed and you can text your approval. The companies who really understand how to build a great customer experience are figuring out that text messaging, not just text messages and notifications, is just the beginning. Building relationships is a two way thing. 

    Every Company Needs To Use Digital To Connect With Customers

    We just focus on the long term. We focus on customers. We focus on helping customers achieve their goals. We focus on the biggest trends that are going on in the industry which is every company needing to use digital to connect with their customers. When times are good and when times are bad every company needs to focus on growing their business, making their customers happy, and making their customers become loyal repeat customers. That’s the business that we’re in.

    Text Conversations Build Customer Relationships, Says Twilio CEO Jeff Lawson
  • SurveyMonkey CEO: Our Enterprise Business is in Hyper-Growth Mode

    SurveyMonkey CEO: Our Enterprise Business is in Hyper-Growth Mode

    Our business on the enterprise side is in hyper-growth mode, says SurveyMonkey CEO Zander Lurie. “We grew our new bookings 80 percent year-over-year,” says Lurie. “We booked our first $10 million quarter, our first million-dollar customer, and we signed up 11 percent more customers in the last quarter alone than we had over all these years. We’re a super disruptive survey software for the enterprise.”

    Zander Lurie, CEO of SurveyMonkey, discussed the company’s Q4 earnings and their massive growth in enterprise bookings in an interview on CNBC and during their earnings announcement:

    Our Enterprise Business is in Hyper-Growth Mode

    We were thrilled with our earnings report for Q4. 2018 was a transformational year for the company where we reaccelerated revenue, generated really robust cash flow, and went public. We’re a 19-year-old company. We have had a lot of private shareholders for a long time and the lock-up expiration could well contribute to some of the selling supply today. But I’m super confident in our in our long term focus. If we deliver results, I know shareholders will profit as well.

    We have a beloved brand and one of the largest footprints of users around the world with over 17.5 million active users. If you look at our business today, we have over 647,000 paying customers who sit inside of 345,000 different organizations, including paying user in 98% of the Fortune 500. Our business on the enterprise side is in hyper-growth mode. We grew our new bookings 80 percent year-over-year. We booked our first $10 million quarter, our first million-dollar customer, and we signed up 11 percent more customers in the last quarter alone than we had over all these years. We’ve got a lot of traction with a really world-class leadership team.

    We’re a Super Disruptive Survey Software for the Enterprise

    We’re a super disruptive survey software for the enterprise. We have a large footprint inside of so many companies where we have not been bought at a corporate IT level. These organizations in this environment need that secure collaborative software that we offer. Our open integration strategy has proven to be a winner. It’s a really competitive market, but it’s a huge multi-billion dollar global market.

    Our largest competitor in Qualtrics just sold to SAP. That opens up a lot of greenfield for us as they steer into SAPs business. We’re steering more into a Microsoft and Salesforce ecosystem where we see a lot of room to grow in customer experience management, HR, and market research.

    Critical to Understand the Sentiment of Your Constituents

    It’s so critical to understand the sentiment and voices of the people who are your constituents. Whether it’s your employees or your customers or you are doing market research, trying to understand these really dynamic environments, understanding the voices and opinions of the people who matter to your business, is critical.

    I too am surprised about Amazon pulling out there. I think the reaction and how quickly that’s changed in several months has been very surprising. Your gut instinct is helpful, but what’s really helpful is actually collecting the opinion data of the people who matter to you if you’re trying to launch a new product or doing a campaign test or to understand where to expand and what the reaction will be like from the community or government.

    Organizations need to collect feedback from their most important constituents, so they can drive innovation and growth. In the internet economy, businesses must be data-driven and responsive to their customers. Companies must test campaign messages and pricing to renew customers. In an increasingly competitive war for talent, organizations are investing more in their employee culture. Understanding how to measure, benchmark, and act on the sentiment data define today’s agile and successful companies.

    SurveyMonkey CEO: Our Enterprise Business is in Hyper-Growth Mode


  • We’ve Gotten Enormous Benefits From the Digital World, But Trust Has Really Suffered, Says SAP CEO

    We’ve Gotten Enormous Benefits From the Digital World, But Trust Has Really Suffered, Says SAP CEO

    SAP CEO Bill McDermott released a video message on Twitter saying that “trust has really suffered” despite the “enormous benefits from the digital world.”

    Bill McDermott, CEO of SAP, discussed his concerns about trust in the digital world in a Twitter video:

    I think trust has really suffered. In many ways, we’ve gotten enormous benefits from the digital world. In fact, you can stay connected to everybody, almost every place, by just picking up your device in the morning and never leaving your house.

    But the reality is the human contact, the interdependence that comes with trust, and that trust is formed one person, one conversation, one relationship, and in my way of thinking it still has to be a live conversation.

    There is nothing that replaces the person to person relationship that gets developed looking at somebody, being in that space, being in that moment, and conveying how you really feel from the heart.

  • SAP CEO: We Out-Innovated Everybody

    SAP CEO: We Out-Innovated Everybody

    SAP announced the completion of its $8 billion acquisition of Qualtrics which brings critical real-time customer experience data to its customers. SAP CEO Bill McDermott explains how the combination of Qualtrics’ Experience Management (XM) Platform with SAP’s enterprise software and cloud services is not only a game changer for companies, but solidifies SAP as the world’s business software leader:

    “Where did we leave them in the dust? We basically out innovated everybody in terms of how you run your business better. Now the idea is how you create an unbelievable human experience so you inspire your people to take care of your customer and create a loyalty effect that’s unlike any other company in the industry. That’s what we do.”

    Bill McDermott, CEO of SAP, talks about how the integration of Qualtrics into SAPs enterprise solutions will help businesses know their customers with real-time sentiment analysis, in an interview with Fox Business at Davos 2019:

    With Qualtrics Your Brand Will Become a Religion

    I think it’s really important that you focus on the business of your customer and stay obsessed with that and not get caught up in a lot of tech jargon. That’s why I’m glad we’re the business software market leader.

    There is a huge trust deficit in the economy. Customers aren’t necessarily getting what they paid for which is why there is a $1.6 trillion deficit from customers that defect from companies that are out there in the marketplace today. So how do you keep a loyal customer? Today’s systems create operating data. You know your customers, you know your people, you know your suppliers. But we need to know what are consumers saying in real time, in the moment? We need that sentiment analysis.

    Qualtrics is the number one experience management company in the world. From now on, your customers, if you are CEO, will love your products. In fact, they will be obsessed with them. Your brand will become a religion because every employee is an ambassador that’s connected inextricably to the customer experience. That’s Qualtrics.

    If you are a customer of SAP, now you have all the experience data. I call this X-data. This is data from all the consumers that are experiencing your product and your brand. You combine that with the O-data which is all the operational aspects of how you run your company, from your demand all the way through to your supply. You know everything. You take X plus O and you have the winning formula.

    The Enterprise Has Been Redefined by SAP

    We surveyed, with Qualtrics and SAP, along with the World Economic Forum here, we surveyed 10,000 individuals on a random sample in 29 different countries. Once of the questions was, “What are you really worried about out there?” Most humans said we are worried about being replaced by robots. We said, “Is tech for good or is tech for bad?” What’s happening in your world with the perception of technology? They said, “A little bit better than negative, but somewhat ambivalent.” That’s a concern.

    They said that they are basically trusting the people that run their companies, even more than the people that run government. There is a trust deficit out there. It’s really important that we close that trust deficit at the leadership level. It’s also important that companies get the human experience going with their own employees and their customers. That’s why I think that this experience management positioning for SAP is fundamentally going to be a moment in time where the enterprise has been redefined by SAP.

    Over 77 percent of the world’s transactions run through an SAP system. We manage everything from the customer relationship to how you manage your people to how you build great products and how you ship on time and deliver. Now we have experience management which is the ultimate touchpoint for customers, and we put it all in the cloud. So you can be nimble, you can be agile, and you can upgrade quickly. You don’t need a whole lot of resources to maintain these systems. We are moving faster than anyone in 25 industries and in 193 countries around the world.

    About the S/4HANA Upgrade

    S/4HANA is now the system from the demand signal of your consumer in any channel including ecommerce. We know your consumer. We align the product in the proper configuration, at the proper price based on the customers history and all the loyalty that they should earn in their business with you. We ship. We take care of the whole supply chain. You get what you want at the price you procured for anyplace in real-time in the world. That whole value chain is SAP.

    4HANA is now in a cloud. So you can run your entire company from end-to-end on top of SAP’s 4HANA platform in the cloud. Game change. Again, I go back to, that’s all the operational data and all the operational processes. Now, if you can add experiences to this with Qualtrics you’ve got an unbeatable competitive advantage.

    I’m signing up customers left and right on this idea in Davos because this has been the number one thing that businesses have forgotten. You have to have the experience under control with your consumer and it has to be real-time sentiment analysis. Just think, it’s five times more expensive to get a new customer than to keep the one you have. Don’t you want to know how they’re doing?

    No Signs That There is This Global Slowdown

    We have a very strong business. There are no signs in our business that there is this global slowdown. Because we serve the best run businesses in the world we are usually an early indicator of what’s going on out there. We see a very optimistic future. Our pipelines and our business model have not changed one iota. I think there is this disjoint between the consumer companies and the consumer world and the enterprise.

    SAP CEO Bill McDermott: “We out innovated everybody.”
    SAP Bill McDermott: “No signs that there is this global slowdown.”


  • Salesforce co-CEO: We Are Just at the Dawn of the Fourth Industrial Revolution

    Salesforce co-CEO: We Are Just at the Dawn of the Fourth Industrial Revolution

    “Our customers, they’re betting their business on us,” says Salesforce co-CEO Keith Block. “They’re disrupting their business models. They’re reinventing themselves leveraging our technology. They want to know that we have a trust-based relationship. At the end of the day, it is all about trust.”

    Block says that we are just at the dawn of the Fourth Industrial Revolution and that companies love to work with Salesforce because they represent the future.

    Keith Block, co-CEO of Salesforce, discussed how companies are going through massive business model and digital transformations in this Fourth Industrial Revolution that is just getting started. He was interviewed by the legendary Jim Cramer on CNBC: (video below)

    We Are Just at the Dawn of this Era

    We’re playing for the long game here. We’re going to be celebrating our 20th anniversary coming up in just a month. When we think about what’s happened over the last 20 years, we’ve seen revolutionary changes in technology and we’re in this Fourth Industrial Revolution. In that Fourth Industrial Revolution, we have companies going through business model changes and digital transformations and the role of the CEO is different than it used to be.

    This is where companies love to work with Salesforce because we represent the future. We’re all about the future. We’re about creating and innovating and co-creating around customer engagement. This is a long game this Fourth Industrial Revolution and we’re just at the dawn of this era. So this will be happening for a long time.

    Disrupt or Be Disrupted

    It’s all linked together. We live in a world with these technologies where it is disrupt or be disrupted. If the CEO of a company is not the Chief Transformation Officer they need to come up with a strategy, they need to make a move, they need to embrace these technologies. No industry is really immune from this level of disruption.

    At the end of the day, everything begins and ends with the customer. It’s all about the 360-degree view of the customer. That has been the Holy Grail since I’ve been in the industry. Providing the insights, providing the level of engagement, the technology, around how customers can have a greater experience.

    Our customers, they’re betting their business on us. They’re disrupting their business models. They’re reinventing themselves leveraging our technology. They want to know that we have a trust-based relationship. At the end of the day, it is all about trust.

    Everything Rotates Around Trust.

    We are a values-based company. Since the day the company was established we were a values-based company. We have four values and our number one value is trust. Then we have customer success and innovation and equality. Those are very very important to our stakeholders. The modern company is a stakeholder theory company.

    It’s not just about Wall Street and earnings, which is obviously very important. We take our shareholders very seriously. It’s also about our customers. It’s about our partners. It’s about the community that we live in. Everything rotates around trust. We have a trust deficit. Some people call it a trust crisis in the world right.

    If you have an employee, an employee wants to know that they have a leadership team that’s listening to them, that they have a voice, and that they trust the decisions the leadership is making. They want to trust that they’re responsible decisions that are consistent with the values of the company. With governments, we trust in our leaders. We want to trust in our leaders that they’re making great decisions for our citizens.


  • Cloud Taking Over the World, Says Okta CEO

    Cloud Taking Over the World, Says Okta CEO

    Cloud is just getting started says Okta CEO, Todd McKinnon. He says that everyone talks about the how cloud has come of age, but it’s really at only 20 percent of $1 trillion in IT spend. “We’re still in the early days of cloud adoption,” says McKinnon. “We’re very excited about the runway ahead and the value we can provide, in that context of really… cloud taking over the world.”

    Todd McKinnon, CEO & Co-Founder of Okta, recently talked to Jim Cramer on CNBC about the massive future still ahead for cloud computing and Okta:

    We’re the Plumbing, We’re the Infrastructure

    We’re changing their world. We’re making it incredibly easy for them to connect to all their technology. Whether they’re logging into their business applications at work or they’re a customer of one of our customers, logging into a website, making their customer experience more enjoyable and more secure. They’re big fans of Okta.

    We help our customers both directly, where their end users can see what we do in some cases. But in many cases, we’re behind the scenes, we’re the plumbing, we’re the infrastructure, that’s making their technology secure and making the end user experience super enjoyable. We’re happy to place to play both roles because at the end of the day it’s about making customers successful with any technology they want to use. Whatever they choose to use we will fit in with it and will make their lives productive.

    Cloud is Taking Over the World

    This is our ten-year anniversary. We’re incredibly excited about ten years. and during those 10 years, we’ve benefited from several trends that are really lifting us to these new heights. The main one is cloud computing. Cloud has progressed tremendously over the last ten years, but the most exciting thing is it’s really just getting started.

    If you look at the overall IT spending market, it’s over a trillion dollars of IT spend. Everyone talks about the how cloud they think the cloud has come of age, but it’s still only 20 percent of that. It’s about $200 billion. We’re still in the early days of cloud adoption. We’re very excited about the runway ahead and the value we can provide in that context of really… cloud taking over the world.

    Adobe Has Done Something Amazing

    We help Adobe in a couple of really important ways. They’ve been a longtime customer of ours. The first way is that we help their business customers connect into the Creative Cloud. The second way we help them is we help their 20,000 employees connect into all the applications they need to do their job at Adobe.

    Adobe is an interesting story, not just because it’s an Okta customer, but they’ve done something very amazing. They’ve transitioned their business from a package software business to a cloud business. You’ve seen the results in their business and in their strategic position in the market. We were lucky enough to play a helping role as we helped that login securely to that new Creative Cloud product they’ve had in the market for the last four or five years.

    We Are Focused on What Customers Need

    We help enterprises get rid of those passwords. Our customers that use Okta for their employees, they have one single login credential that takes them into all their applications. It greatly simplifies the end-user experience and as a result, makes it way more secure and way more productive.  At the end of the day, it’s about how productive you can make your people and how great you can make the experience and how attractive you are as an employer and the kind of people you can attract.

    There are companies that have similar solutions. We at Okta are trying to be focused on what our customers need and not get too caught up in a platform player that’s trying to do what we’re doing or a niche upstart that’s trying to copy some of our features. We are really focused on what do the customers need? Do they need help connecting to their customers? Do they need help with certain kinds of security architectures that are emerging as they move to more of a cloud central model?

    From the beginning of the company over the last ten years, we’ve been incredibly customer-centric, listening to what customers needed and having that be our North Star. That’s worked incredibly well. It’s not a coincidence (that I sound like Marc Benioff). I worked at Salesforce for six years. I basically learned the ropes of cloud computing from Marc and the entire team at Salesforce. So it’s not it’s not a shock that there are a lot of similarities there.


  • Zoom CEO: If We Cannot Make the Customer Happy, Nothing Will Matter

    Zoom CEO: If We Cannot Make the Customer Happy, Nothing Will Matter

    Zoom Founder and CEO Eric Yuan says that the number one most important thing for a business is to make the customer happy. He says it really comes down to these three areas of focus; Product, Process, and People.

    Eric Yuan, Founder, and CEO of Zoom, recently sat down with industry analyst Michael Krigsman, who conducted another fascinating interview for his CXOTALK video interview platform:

    If We Can’t Make the Customer Happy, Nothing Will Matter

    I think, every day as a CEO who manages a company, I have so many things to work on but, ultimately, I’ve got to understand what’s the number one important thing as a business, right?

    If we cannot make the customer happy, nothing will matter. That’s why this is our number one priority. If a customer is happy, everything else will be easier. Customers will like to talk with us, share our stories with others and, essentially, will help us to further improve our product experience and also make our business better.

    Look at Everything From a Customer Perspective

    You’ve got to look at everything from a customer perspective. If you truly care about them, you are not only going to look at it from your perspective. When you build a product, you will say, “Hey, will this product, will this feature, deliver happiness or add value to a customer or not?”

    Anything you do, look at it from a customer perspective. Then, actually, the customers, they will feel more like a part of your business. They’re happy to grow your business.

    Focus on Product, Process, and People

    Ultimately, it’s three things. When we talk about happiness, first of all, your product has got to work, right? Every time a customer is using Zoom, they really like it. That’s the number one thing; your product has got to work. Every time after the meeting is over, customers say, “Yes, this experience is great.” They enjoy using your product.

    The second thing is your process. When you do business with customers, you’ve got to make sure your process is very simple but very easy.

    The third thing is about the people. Meaning, because not only do those customers use your product but, also, we want to make sure every interaction between Zoom employees and the customers  — say like support, a customer success manager, engineers, our product managers — every interaction between our company and the customers, they enjoy it. Process, people, and the product, from all those three aspects, we make sure the customer is happy.

    Watch the full 44-minute interview below or read the full transcript at CXOTALK:


  • Seth Godin on The Difference Between a Logo and a Brand

    Seth Godin on The Difference Between a Logo and a Brand

    Enterprise marketing legend Seth Godin says that the value of a brand is measured by how much extra you will pay above the substitute. He says that if Nike opened a hotel everybody would know what it would be like because they have a distinct brand. On the other hand, he says, if Hyatt or some other big hotel chains came out with sneakers we would have no clue what they would be like because they don’t have brands.

    Seth Godin, author and marketing expert, recently discussed Nike and brand value on Behind the Brand with Bryan Elliott:

    The Difference Between a Logo and a Brand

    Let’s talk about the difference between a logo and a brand. Companies spend way too much time on their logo, just like people on YouTube spend way too much time on their hair… I’m told. If Nike opened a hotel I think we would be able to guess pretty accurately what it would be like. If Hyatt came out with sneakers we’d have no clue because Hyatt doesn’t have a brand, they have a logo. If I swapped the signs on a hotel at that price point you couldn’t tell. If you were a Marriott, if you were a Hilton, Hyatt, the hallway, the room, I don’t know where I am. No brand.

    What it means to have a brand is you’ve made a promise to people, they have expectations, it’s a shorthand, what should I expect the next time? If that is distinct you’ve earned something. If it’s not distinct, let’s admit you make a commodity and you’re trying to charge just a little bit extra for peace of mind. The problem that Hyatt and Hilton and Marriott and the rest have is sort by price. If I go online now to find a hotel it’s really simple, sort by price. Why would I pay $200 extra to go a block away? I don’t.

    What’s the Value of a Brand

    What’s the value of a brand? The value of a brand is how much extra am I paying above the substitute. If I’m not paying extra you don’t have a brand. When we think about what brands ought to do to move forward, the most important thing is to not worry about your slogan, your spokesperson, they’re wrapping. Its to worry about the substance, work that matters for people who care. Find the people who care, the smallest viable group you can live with, and figure out how to give them work that matters.

    There are hotels, these new chains of mini-boutique hotels, that charge double what a Hyatt might charge, for less. But it’s only less by the Hyatt measure. It’s way more by the measure of someone who cares about with the people in the lobby look like or who cares about how hip it feels to walk into the bar. They’re investing not in… oh you get a room with three power outlets. They’re investing in throwing a party in a place where you also can sleep while you’re on the road. Those hotels have a brand and those hotels are some that some people pay extra for but almost no one in the scheme of things.

  • Chick-fil-A: Email is Our Biggest Driver of Keeping Somebody Engaged

    Chick-fil-A: Email is Our Biggest Driver of Keeping Somebody Engaged

    About a year and a half ago Chick-fil-A decided to go back to their roots of being a people first business in their use of email marketing. They scrapped multiple email databases and multiple email templates and most importantly focused on answering real customer needs through personalization generated from many customer touch points.

    This has led to a five times increase in membership to Chick-fil-A One and a 20 percent increase in conversions.  “Email is certainly not the only driver of that but we have seen email being the biggest driver of keeping somebody engaged or re-engaging them,” says Emily Randall who runs interactive digital media at Chick-fil-A.

    Emily Randall, Interactive Digital Media, Chick-fil-A, recently gave a talk at MediaPost’s Email Insider Summit on how they successfully transformed their use of email marketing to not only match their founders people first philosophy, but to also more effectively engage with their customers:

    We’re Not in the Chicken Business, We’re in the People Business

    The founder of Chick-fil-A, Truett Cathy,  often said we’re not in the chicken business, we’re in the people business. So we think a lot about hospitality. We think about going the second mile for our customers and hopefully, you’ve experienced that if you’ve been to a Chick-fil-A.

    Today we have about 2,300 locations across the country so it gets a little bit harder to know all of our customers by name like Truett did when he opened the first restaurant but what we have rallied around stems from what Truitt said.

    Changed From Batch and Blast Emails to Personalization

    When you know someone’s story you can care for them personally. The team really thinks about what are all of our marketing touch points and how are we caring for people personally through the each of those touch points? We think about each of those touch points and ask is is this a deposit on the customer relationship or is this a withdrawal?

    We took a look at our email program about a year and a half ago and we said, hey, this is actually a little bit more of a withdrawal. We’re doing this batch and blast approach with our email program, it was pretty messy, and so we decided that we needed to fix it in order to start adding value to that relationship with our customers. This is really about becoming modern marketers.

    We decided to partner with MessageGears which has allowed us to personalize some of our emails. So today, it’s about a year and a half later and we looked at how do we actually do this and what does this look like? One, we have about three times the email database that we had about a year and a half ago so we have definitely seen growth. A big part of that is because of Chick-fil-A One our membership program.

    Balancing Scale and Personalization

    Then we think a lot about balancing scale and personalization. One of our differentiators is the local ownership and so we want to be able to take stories that are happening personally and then highlight those in email at scale. We also want to be able to take stories that are at scale, like our national campaigns, and then personalize those. That’s a tough balance that we’re still trying to figure out.

    We also are balancing local email where we let our operators email directly, they email their customers. These are people who transact with their restaurants, so they don’t have access to everybody in our membership program, but anybody who transacts with their restaurant they can email.

    We on the brand side give them templates and we give them the tools to be able to send out those emails. We share best practices and then each template is just one single message. They can load in their picture, you can actually see their face, they can add their signature, and they can tweak the copy. Sometimes it’s about a limited time offer like our peppermint chocolate chip milkshake or it could be information about closing for a renovation. They can also send really personal emails to even just one person if they want to.

    Pulling From Multiple Data Source to Personalize Emails

    We also balance that from an air cover standpoint from the brand with two emails a month. We have all kinds of different messages flowing into into this one. What’s nice is that we can see the people that they have emailed. Where our biggest opportunity on the brand side is thinking about the entire audience that doesn’t fall into one of their local CRM systems. What does win-back look like? What does re-engagement look like? That’s where we can uniquely help on the brand side that the operators don’t have access to.

    With our email wireframe we’re pulling in multiple different data sources including customer profile data, transaction data, and then location. We have a lot of other sources as well so we’ll tweak the message or the creative based on where somebody is in their journey with Chick-fil-A.  For example, for a particular spot in our email we had different options that we could plug in based on if somebody had never mobile ordered, if they’ve scanned and not mobile ordered, or if they mobile order all the time. We would tweak that depending on where they were while taking a mobile order action.

    Email is Our Biggest Driver of Keeping Somebody Engaged

    We start out with at least 32 base segments per email. We also have at least 500 different versions. We have seen about a five times increase in overall memberships since we started this personalization. Email is certainly not the only driver of that but we have seen email being the biggest driver of keeping somebody engaged or re-engaging them. We’ve also seen about over 20 percent increase from a conversion standpoint for people who receive the email versus a control group.

    From an attribution standpoint, we are able to measure that. It’s incredible how you can tie action in email to actual sales. I come from a background of social media marketing and we can’t tell those types of stories in social. It’s really incredible that we are able to start to share these stories of success and actually measure attribution in this email marketing channel.

    Focus on What’s Important to the Customer

    What’s next for us is going back to the basics and just seeing people as people. You can’t think of them as an email address which is way easier said than done. We want to continue thinking about what’s important to our customers and continue with research to understand what is it that they really want from us?

    This means not jumping on technology just to jump on new technology. It’s really easy to get caught up in the new bright shiny thing and for us, it feels like we’re still learning. I think there’s a lot of opportunity for us out there but I think going back to the basics of just who are these people and how do we organize our program in the right way has been a huge step in the right direction for us.

  • Salesforce CEO: Incredible Wave, Global Phenomenon of Digital Transformation

    Salesforce CEO: Incredible Wave, Global Phenomenon of Digital Transformation

    Cloud adoption is just in the very early days says Salesforce co-CEO Keith Block. He says that over the last few years we’ve been in a perfect storm of cloud and mobile and data science and artificial intelligence coming together that have given companies the opportunity to reinvent themselves and reinvent their business models. Block says that this has been an incredible wave and a global phenomenon of digital transformation.

    Keith Block, Salesforce co-CEO, discussed the global phenomenon of digital transformation in an interview on CNBC:

    Cloud Adoption is Still in the Very Early Days

    I believe we’re in early days. Salesforce will be celebrating its 20th anniversary very quickly and we’ve had a meteoric rise. We’ve been the fastest enterprise software company and in the top five software companies in terms of growth to $10 billion. We just gave our guidance to $13 billion and we’ll do $16 billion for next year. But cloud adoption is just in the very early days.

    Incredible Wave, Global Phenomenon of Digital Transformation

    What we’re really seeing right now is this incredible wave, this global phenomenon of digital transformation. Over the last few years, when you think about this conversion, this perfect storm of cloud and mobile and data science and artificial intelligence, these amazing technologies that have come together, it’s given companies the opportunity to reinvent themselves and reinvent their business models. I think classically of a company that is a B2B company that now wants to become a B2C company and that’s where Salesforce really plays beautifully in terms of getting closer to that customer.

    MuleSoft Completes the Wave of Digital Transformation for our Customers

    Specifically on MuleSoft. A great example is really having the holy grail of the 360-degree view of the customer, where you have information about the customer, where you can personalize the experience for the customer, where the customer feels like they are personally engaged with the companies that they do business with. MuleSoft is an amazing integration technology and we’re very lucky to have it. It really completes the wave of digital transformation for our customers in the sense that it’s allowing you to unlock data from any source.

    Cloud Brings the Ability to be Agile, Nimble and Flexible

    Think about decades of legacy data that have been built up and built up and built up and CEOs want to know how do we access that legacy data in a very agile and in a very quick fashion so we can serve it up to our systems of engagement? That’s why the marriage of Salesforce and MuleSoft has really become very compelling for CEOs all over the world. At the end of the day what the cloud brings you and what we bring at Salesforce is the ability to be agile, to be nimble, to be flexible, and actually bring something we refer to as a beginner’s mind. Completely taking a step back and saying, how do we reinvent, how do we innovate, how do we go quickly?

    You can move, because of the technology that’s available today, far more quickly than you could in the age of the legacy system. It starts with that, bringing a point of view, speaking the language of the industry, understanding that talking to a bank is different than a telecommunications company. These technologies apply in different ways. Those are very fundamental than what you see with some of the legacy technology companies that are still using the same motion.

    CEOs Must Commit to Digital Transformation

    The second is it’s all about trust and making sure that you have a trust-based relationship with your customers. The third thing that I would tell you and I think is very very important is that we live in a world today where because of that convergence, that perfect storm of technology, we now have this global phenomenon called digital transformation. The most important aspect of that is the commitment from the CEO. The CEO has become and must be become the Chief Transformation Officer.

  • Salesforce co-CEO: Who’s Not Going Through a Customer Transformation?

    Salesforce co-CEO: Who’s Not Going Through a Customer Transformation?

    Salesforce is booming and the reason is that virtually every company in the world is going through a huge digital transformation, according to Salesforce co-CEO Marc Benioff. “The reason why is every company that we’re dealing with is going through a huge digital transformation and every digital transformation begins and ends with the customer,” says Benioff.

    Marc Benioff, co-Founder, Chairman, and co-CEO of Salesforce, recently discussed the companies latest financial results and explained how the digital transformation is powering their continued massive growth in an interview with Jim Cramer on CNBC:

    Fastest Growing Enterprise Software Company of All Time

    We see hitting our big goal which is $22 to $23 billion in revenue within two fiscal years. By fiscal year 2022. Now here we are we’re giving fiscal year 2020 guidance for the first time at $16 billion. Salesforce remains the fastest growing enterprise software company of all time and that’s incredible. I don’t think the company has ever been stronger or been in a better position.

    These revenue numbers are incredible and way beyond our expectations for the quarter It’s awesome. We had a great quarter, the third quarter was phenomenal. We’re giving phenomenal guidance for the fourth quarter and certainly, we’re all praying and hoping to improve on that by the way and now we can see a strong fiscal year ahead in fiscal year 2020 as well.

    Every Digital Transformation Begins and Ends with the Customer

    I don’t think the company has ever been stronger or been in a better position. The reason why is every company that we’re dealing with is going through a huge digital transformation and every digital transformation begins and ends with the customer.

    Just look at one of the largest deals we did this quarter, it’s a nine-figure deal with one of the largest banks in the world and they’re just rebuilding how they deal with their customers. That’s an amazing story for us just to see everybody go through this transformation. It’s everything that is customer facing for one of the top five financial institutions in the world.

    Another one that I can give you the actual name for that is doing something just as exciting is Citibank. Michael Corbat has done a fantastic job as CEO of Citibank. We’ve been working on the retail transformation there and this quarter they opened the door for us and now we’re doing the wealth transformation as well. We couldn’t be more excited about everything that Citibank is doing.

    Every Company is Transforming Their Customer Relationship

    Every company is transforming their relationship with their customer. We’re going from a world where if you don’t have a digital one-on-one relationship with your customer you’re just not going to be that successful. You can look at some of the huge successes that we’ve had in the quarter. One of the stories that I love is Uber. Uber has a tremendous need to have a relationship not only with you the consumer but also with the driver and their own internal operations. As we’ve been able to improve our relationship with Dara Khosrowshahi and other executives in the company, we’ve seen them really transform their relationships with their customers.

    Apple has been a great opportunity for us, we’ve worked on that for so long. Of course, we all use our Apple products all the time at Salesforce. Now we have a strategic alliance with Apple and we’re encouraging our customers to do what we do which is take their information on the road. All of our products work natively now on iOS. We have the ability to automate every enterprise around that incredible platform and we see customers doing that.

    ServiceMaster Building a 360-Degree View of the Customer

    Another great story during the quarter was ServiceMaster. This is a company that has a lot of brands such as Terminix and many others. This is a huge field service operation but it’s also the integration of their call center, their contact center. They’re trying to build a 360-degree view of the customer, so of course, you’re working with their technicians in the field and they need to have a strong institutional memory of you back in headquarters. That’s a digital transformation that is so exciting for so many companies where they protect their homes.

    Who’s Not Going Through a Customer Transformation?

    We’re the largest and most important CRM company in the world. We’re number one in CRM by market share and revenue and by revenue growth. It’s a big industry and all the players are doing well because every company is going through this customer transformation. Who’s not going through a customer transformation? Everywhere I go in the world this is happening and it’s been going on and it’s not going to stop anytime soon.

    It’s about sales, it’s about service, it’s about marketing, it’s about commerce, it’s about analytics, it’s about applications, it’s about good building community, or in the case of one of the great customers that we have, DuPont, it’s about integration. We had this fantastic acquisition this year, MuleSoft, the ability to integrate everything together. This is so important for us and so many of our customers.

  • Boeing CEO: For the First Time Ever We Have Backlogs of 7 Years Instead of 2

    Boeing CEO: For the First Time Ever We Have Backlogs of 7 Years Instead of 2

    The CEO of Boeing, Dennis Muilenburg, says that for the first time ever Boeing has airplane production backlogs of seven years instead of just two. He said that this demand is driven by the rising middle class throughout the world. Boeing has a current backlog of over 5,800 commercial airplanes.

    Dennis Muilenburg, Boeing CEO, recently talked about the Boeing’s growth on Fox Business:

    Growth Driven by Rising Middle Class Throughout the World

    We see traffic growth around the world as just tremendously strong right now growing at six to seven percent a year. Cargo strength has also returned year-to-date growing at about four percent. Those growth trends are out-stripping global GDP. Much of this is driven by the rising middle class throughout the world that’s really fueling the growth in this industry.

    We are ramping up production. On the 737 line, we ramped up to 52 a month this year, 57 a month next year. While we are doing that we are bringing in new innovation and new capability. The 737 MAX and the narrow body but also working on the next generation of widebodies. The 787 Dreamliner which has been very successful and we’re taking that up to 14 a month production rate next year. The 777X that we are working on will go into flight testing next year with first delivery in 2020, right on schedule. That’s important to our customers in the Asia-Pacific region as well as in the Middle East and here in the US.

    For the First Time Ever We Have Backlogs of 7 Years Instead of 2

    We have a backlog today of about 5,800 commercial airplanes. That’s the equivalent of about seven years of backlog. Our customers tend to make very long-term decisions that aren’t as much influenced by local interest rate fluctuations or oil price fluctuations. We are today selling airplanes, 737 MAX’s for example, and our production skyline out in 2023 and beyond. That’s the long-term headset of this business.

    The fact that we have that healthy backlog really allows us to think about long-term investment in the business to sustain growth. For the first time ever we have backlogs measured in about seven years instead of two. We are making long-term investments, disciplined in our production rates, so fundamentally the structure of the business has changed. We see this as a long-term sustained growth business. The growth in commercial airplane production is fueled by passenger growth around the world. We see that as a decades-long trend.

    Services Business is Our Single Biggest Growth Opportunity

    We are also growing now in our services business which is a significant additional capability for us, probably our single biggest growth opportunity. Services by its nature is a non-cyclical business which is part of this sustained growth model that we built. We just launched our new services business about a year and a half ago and year-to-date its been growing at 12 percent per year compared to a market that is growing at three percent a year. We are competing and winning at services.

    We also see our defense business as strong. One of the things that is unique about Boeing is what we call our ‘One Boeing’ approach which spans commercial services and defense and that’s providing a unique competitive advantage around the world.

    For acquisitions, we targeted areas we call verticals, things like avionics capabilities, interiors, and this past week we announced a new joint venture in auxiliary power units. These are examples of things that can grow our services business. When you think about what’s really valuable to our customers when you look through this lifecycle lense, not only how we design and build airplanes, but post-production, how do we support them and provide to our customers? That’s where we are really seeing some strong growth.

  • SiriusXM CEO: Pandora to Make Sirius Subscribers More Sticky

    SiriusXM CEO: Pandora to Make Sirius Subscribers More Sticky

    SiriusXM CEO James Meyer says that Pandora will make Sirius subscribers more sticky and will overall reduce churn. Meyer indicates that Pandora’s focus on advertising revenue will also help Sirius monetize the two-thirds of auto sales free trials that don’t convert to a paying SiriusXM subscriber.

    James Meyer, CEO of SiriusXM, discussed the Pandora acquisition on CNBC:

    Pandora to Make Sirius Subscribers More Sticky

    We’re doing a lot of work on the integration of the companies (Pandora into Sirius). I’m more excited about the opportunity of Pandora today even as I dig deeper into it because I see the opportunity and I see it in in two big areas. Number one, I see how it can benefit Sirius and by that I mean our subscribers in terms of improving our value proposition and the ability to take the $5 and $10 music plans.

    In themselves, they are not very profitable, but bundling them in a way to our existing 33.7 million subscribers and giving them a better value, in the end, will make them more sticky and overall reduce churn.

    We Are Not in the Music Business, We Are in the Radio Business

    We’ve been a business that built our business on subscription, 96 percent of our revenue comes from a subscription and 80 to 90 percent of Pandora’s comes from advertising. The ability now to have both across that spectrum I think it’s a really important tool and I’ll tell you why. I think sometimes people get confused, we’re not in the music distribution business, we’re in the radio business. The radio business in the US is about a $24 billion business.

    23 Million Real Trials This Year

    This year alone we’ll run 23 million real trials. We know when you buy, we get your name and address, we speak directly with you during those trials and we’re thrilled if our yield out of those is one-third. The other two-thirds we don’t do anything about. Going forward, we’re going to worry about the third and then we’re going to worry a lot about the two-thirds and how many more of those can we monetize.

    As investors think about our company a couple years from now the question they ought to ask is, quite simply, how many of these trials are coming through and in the end what percent did you monetize them at? In other words, what percent of the third, of the 23 million, are you monetizing and what’s happening to that ARPU (average revenue per user) within that as you’re monetizing them? That’s a story we understand well and then that’s what I’m going to drive.

    The Popularity of Sirius is the Highest It Has Ever Been

    If you fundamentally look at Sirius our listeners love to listen to us in the car. They don’t listen to us as much at home or on mobile devices. If you look at Pandora their listeners love to listen on mobile devices and in the home. The merger can certainly help both sides and Sirius and our OEM relationships can bring a whole lot to driving this business going forward.

    I’ve been guiding for many years that I thought our penetration rate, meaning how many new vehicles would include factory-installed Sirius, would be about 70 percent. I think was about a year and a half ago based on input from the OEMs and obviously consumer demand, we took that up to 75 percent. Today I revised that guidance to 80 percent. I think the popularity of Sirius is the highest it has ever been and I think we have a long long time that we’ll have a great place in the vehicle.

  • John Malone says Disney Needs What Apple and Amazon Have… Massive Direct Consumer Relationships

    John Malone says Disney Needs What Apple and Amazon Have… Massive Direct Consumer Relationships

    Liberty Media Chairman and legendary entrepreneur and investor John Malone says that although Disney has a great brand, what they don’t have is a massive number of direct consumer relationships.

    John Malone, Liberty Media Chairman discussed Disney with CNBC’s David Faber:

    Disney Doesn’t Have Massive Direct Consumer Relationships

    Disney has a great brand, there’s no question, and they really know the entertainment business. What they don’t have is a massive number of global credit cards. They don’t have massive direct consumer relationships at this point, and those are not easy to come by. If you look at the other people in the space, Amazon because of their retailing businesses and the creation of Prime has been able to tie into consumer interest pretty globally. It’s very easy for Amazon to sell an incremental service.

    Apple Has 650 to 700 Million Direct Consumer Relationships

    You have Apple wanting to be in this space. Apple is the big gorilla. Apple is wanting to develop a direct consumer entertainment relationship beyond music. Let’s call it into video. We’re estimating that Apple has probably 650 to 700 million direct consumer relationships in which Apple has a credit card, a lot of information about the consumer. They’ve started to put money into original content and they’re certainly having lots of discussions in and around the content industry to figure this out. They want to drive their consumer interface technology, their ecosystem, into the video space in the living room more heavily than Apple TV has so far.

    Jeff Bezos is on a Roll with his Fire Stick, Prime, and Content

    Jeff (Bezos) is on a roll with his Fire Stick and his Prime and his content, so he’s in the living room and Alexa is a is a voice-activated interface that works well, is well thought-through, well-engineered, interfaces with Netflix. I mean well engineered. So the technology side, if Disney has a problem I believe it’s going to be those two things. It’s going to be the technology platform and it’s going to be establishing those one-to-one consumer relationships.

  • CEO of Shipping Giant Maersk: Imports to the US Are Strong

    CEO of Shipping Giant Maersk: Imports to the US Are Strong

    Despite the current trade climate imports to the US remain strong and are currently rising according to Soren Skou, CEO of A.P. Moller – Maersk, the world’s largest shipping company. Skou also discussed their use of technology to decrease fuel usage which is part of an overall initiative that the company has taken to digitize operations. 

    Imports to the US Are Strong

    Freight rates have gone up more than 5 percent so that’s a positive drive. We are also seeing good margin and appropriation in our other businesses, particularly in our logistics and ports business. Right now the global trade is growing at a reasonable pace and container freight rates are going up.

    Imports to the US are strong. We see our customers most likely building up inventories ahead of any tariff increases that may hit in the new year. Obviously, there will be a bill to be paid for that, so to speak, when that movement comes to an end with lower demand growth on the ocean in the first quarter of next year. We are prepared for that.

    The overall picture for the global trade is one of slow but reasonable growth but at the same time very moderate growth in capacity. It’s like a narrowing of the supply-demand balance and that leads to slightly higher freight rates, which of course is very positive for the industry.

    Effectively Using Technology to Reduce Fuel Use

    We work very diligently with our fuel consumption and fuel efficiency. We are slowly but surely able to reduce the amount of fuel that we use per container by deploying technology, by being better in the way we drive the ships and so on. Overall, as we have volume growth, we are also seeing a slow increase in the demand for fuel. We have plenty of fuel capacity available from the global refineries so it’s not like we are going to run out of fuel anytime soon.

    Earlier this year Skou talked about the importance of technology to Maersk:

    The most important thing for A.P. Moller – Maersk is to digitize. We do have an agenda to digitize transactions with our customers and the joint venture with IBM is a step in that direction. We are also digitizing the way we operate the ships, the cranes, and the containers. Also, we do hope that we will be able to create new businesses out of all of the data that we own. 

    Just two to three years down the line we would like to make global container shipping as easy to do for our customers as it is for all consumers today in ordering an airline ticket. We think there is plenty of opportunity for improvement of the customer experience in container shipping. Longer term, there are some problems and issues that we haven’t solved in our industry in terms of visibility, in terms of asset productivity. We believe that digitizing or connecting our assets will be able to help us some.

  • SAP CEO on Qualtrics Deal: A Global Growth Juggernaut in the Cloud

    SAP CEO on Qualtrics Deal: A Global Growth Juggernaut in the Cloud

    SAP CEO Bill McDermott says that buying Qualtrics creates a “global growth juggernaut in the cloud, the number one business software growing in the cloud in the world.” McDermott says that he’s here to build a company for the generations, not just for a few days and that this is a fundamentally transformational deal, one that will reshape the entire industry.

    Qualtrics CEO Ryan Smith says that combining forces with SAP will change the experience economy forever. “This is by far a once in a generational opportunity and it’s going to change how everyone thinks about cloud and SAAS and CRM and ERP and HCM forever,” said Smith. “Why wouldn’t we want to be a part of that?”

    Both SAP CEO Bill McDermott and Qualtrics CEO Ryan Smith talked about the acquisition on CNBC Squawk Box this morning (Watch Video Below):

    SAP CEO: If You Can Combine X-Data and O-Data You Can Change the World

    We’re reshaping the enterprise application software industry. What led us to this deal is that all CEOs you talk to want to run their companies on an end-to-end basis. They want to deal with their customers in every channel, they want to fulfill, and that requires operational data. SAP touches 77 percent of the world’s transactions, but the operational data doesn’t ask the right question. It doesn’t say, why does the customer feel a certain way about your brand, about your products, and about their experience. This new category called experience management is all about x-data and if you can combine o-data and x-data you can change the world.

    Ryan I have known each other about three months. We spent a lot of time together, a lot of text, a lot of phone calls, and we fundamentally wanted a transformational deal, one that would reshape the entire industry and here we are.

    SAP CEO: If You Want to Survey Somebody You Hire Survey Monkey…

    Have you looked at acquiring SurveyMonkey? No, they do surveys we reinvent customer experiences in a whole new category called experience management. If you want to survey somebody you hire Survey Monkey, if you want to fundamentally change the way an enterprise thinks about its culture, its brand, its products, and its people, now you’re talking Qualtrics, the leader in the marketplace by a factor of 10x. We’ve always bought the biggest and the best one and thankfully with the high trust that Ryan and I developed and our companies developed we’re ready to go.

    SAP CEO: A Global Growth Juggernaut in the Cloud

    When you’re talking about this particular company, Qualtrics, they’re growing at 40 percent on a year-over-year basis in the cloud. They have a very serious go-to-market strategy, but it’s modest in size. We’re growing at 41 percent year-over-year in the cloud and we have a very large go-to-market machine, more than 15,000 people touching the customer every day. If you combine that rate of growth you have a global growth juggernaut in the cloud, the number one business software growing in the cloud in the world. So digest that dear shareholders.

    We’re saying and we’re very clear on this, we’re going to grow total revenue in double-digit, operating income in double-digit, not to mention being the fastest growing cloud company in the world. So today this will be digested. Now they’ll know, why did he do a big one when he said he was more likely gonna do tuck-ins? Because I never thought I would get Qualtrics and it takes some skill to pull deals like this off and convince a great entrepreneur like Ryan that he’s better off with SAP than going it alone when he’s 13x oversubscribed in his IPO.

    SAP CEO: I’m Here to Build a Company for the Generations

    So that’s what took a little bit of time and when we pulled it off together this weekend we were literally crossing each other in the air at 39,000 feet, so this was high-stakes. Now that we’re here, we’re doing all-hands meetings, we’re talking to the media, we’re talking to the bankers, and I expect the stock to do extremely well as the day progresses, and more importantly in the mid and the long term. I’m here to build a company for the generations, not just for a few days.

    Qualtrics CEO: We Created the Experience Management Category

    We were planning on ringing the bell on Thursday. I was home this weekend just to kind of take a little break after a week on the road it was going really well. We were 13 times oversubscribed with the best still ahead of us and then we had an opportunity to combine forces with SAP and change the experience economy forever. I think in my conversations with Bill it’s something that we only dreamed of that we could make this happen. It’s pretty special.

    We’ve been doing this for 16 years. We transformed the entire experience management category, we’ve created it. We’re powering the feedback for 14 different airlines, 200 financial institutions, and we’ve really created this category to go do something big, that was the goal. We never had a financial reason to go public, we bootstrapped our company longer than anyone and we had no investor pressure. We’re one of the only companies that has been cashflow positive and high growth since its inception. The reason why we were going public was to create this massive new category.

    Qualtrics CEO: A Once in a Generational Opportunity

    When Bill approached us with a once in a generational opportunity that we could take all the power of Qualtrics and our 9,000 brands and have that sit alongside SAP and have every ounce of customer feedback go into the entire product process with an ERP system, reshape how the world thinks about CRM, and everything that we’re doing to power all the employee experience of the whole world that’s all available overnight. That’s something that we couldn’t turn down and we chose to be here.

    Our IPO was already way oversubscribed, it was gonna take off and everyone was looking at us saying, hey this is the next $20 or $30 billion dollar standalone company. But we want to win and this is what winning looks like and we’re going to reshape the entire industry and Bill’s on board and we’re excited.

    We were pretty set on going public and so it wasn’t till this opportunity came through this weekend where we said, hey look, this is by far a once in a generational opportunity and it’s going to change how everyone thinks about cloud and SAAS and CRM and ERP and HCM forever. Why wouldn’t we want to be a part of that? We couldn’t be more excited and like I said this is a pretty special team with Bill and me.

  • Billionaire Ron Baron: By 2030 Tesla Could be a Trillion Dollar Company

    Billionaire Ron Baron: By 2030 Tesla Could be a Trillion Dollar Company

    Billionaire investor Ron Baron says that by 2030 Tesla could be a trillion dollar company. He says it’s clear that Tesla will be at $60 billion in sales within the next 3-4 years. Baron added, “It’s remarkable what Elon Musk has done.”

    Ron Baron, Founder of Baron Capital, discussed his bullish opinion of Tesla on CNBC:

    By 2030 Tesla Could be a Trillion Dollar Company

    It was a good quarter for Tesla. They had $6.8 billion in sales versus $4 billion, so it’s up 70 percent. They made a billion for cash flow in the quarter before they spent on investing. That means they’re at an annualized rate of $5.5 billion of cash flow before they spend them investing. The company is valued for $60 billion, so it’s 11 or 12 times earnings, that’s not bad.

    In addition to that, they are growing at 50 percent a year. I think that this year they did sales at $20 billion. We started in 2014 when they were doing $3.7 billion and this year it’s $20 billion, next year is $30 billion. I think that in 12 to 13 years, by 2030, this could be a trillion dollar company. I think it’s clear they’re going to be $60 billion in three or four years. This could be a really big company.

    Cash Flow Doesn’t Appear to be a Problem

    As the cash flow goes, when I look at the numbers it doesn’t appear to be the problem. Elon Musk says it’s not a problem, I take him at his word. He could have sold equity a year and a half ago at $370 to $380 a share, people were scrambling to buy, he chose not to. You have these businesses that they invest and when they’re investing they penalize profitability.

    When you build a faith factory and you spend $300 million on the factory and it’s built for 250,000 cars a year and you’re doing 20,000 cars a year or 30,000, you’re not going to be profitable with that. But all of a sudden, you get it to 250,000 cars a year, you’re making $150 million on a $300 million investment, then you can double it. You’re at the point now where incremental investments are going to be incredibly profitable. They are now doing 5,000 cars a week, they’re going to be able to do Model 3 for virtually no additional investment. They’re going to get to 7,000 cars a week.

    It’s Remarkable What Elon Musk Has Done

    They told Wall Street this quarter that just ended that they were hoping to produce a gross profit margin of 15 percent on the Model 3 and it came out over 20 percent. Internally, they were hoping for 20 percent and he kept calling meetings, you got to cut costs here, you’ve got to watch that. When you’re building something from the ground up it’s not easy, it’s not easy doing what he’s done, remarkable what he’s done.

    When he started making the Model S and Model X, those cars initially, when they were selling for over $100,000 a car, they had gross profits of 20 percent. Now they’re in the 90s for the car and the gross profits are 31 percent. Gross profits keep going up even though the price has gone down. The same thing is going to happen with this car. I think the gross profits on the Model 3 are going to be as good as they are on the Model S and X and I think the Model Y is going to be the best one they’ve ever had.