We’re just over halfway through the year, and so far 2024 has had its ups and downs for the Salesforce ecosystem. We kicked off the year with yet more layoffs, as well as further warning signs of a weakening job market and candidate saturation. There’s also been the promise of AI saving not just the Salesforce ecosystem, but the world.
Let’s take a look at ten good, bad, and ugly trends that we have seen in the Salesforce ecosystem so far this year!
1. Salesforce Job Market Reset
The weakening job market is one of the biggest changes and most talked about subjects in the Salesforce ecosystem in recent years. Macroeconomic turmoil, layoffs, tightening budgets, and an increase in entry-level talent have led to an increase in available candidates, while the number of open roles available has sharply declined.
This has meant for the first time ever, the Salesforce job market is extremely competitive. Whilst entry-level talents are finding it almost impossible to land their first role, signaling “The End of an Era for “Easy” Salesforce Jobs”, experienced Salesforce talent is having to work hard to compete against others who might have been laid off.
This all points to a market reset for Salesforce. Candidates have enjoyed employers fighting over their Salesforce skills for years, which has pushed up salaries as demand has skyrocketed. But now, the opposite effect is happening – candidates are reporting that salaries are much lower than they have previously been offered.
Although we don’t have any hard statistics on this, our first annual SF Ben Salesforce Salary Survey is due to be released in the next couple of months, where we will see exactly what roles are being paid across the global market.
2. CRM Falls Out of Favor With Wall Street
On the 29th May 2024, Salesforce missed their revenue forecast for the first time since 2006, reporting $9.13 billion vs. $9.17 billion expected which was an 11% YoY increase. Salesforce has historically been a darling of Wall Street, but this news sent Salesforce shares down over 21%.
Although 11% growth for a company the size of Salesforce is still impressive and in line with recent quarters, the stock and industry have been hyped by promises of AI-enabled technology that haven’t materialized (as of yet). Salesforce only recently made their flagship Copilot product generally available in April, so it’s not feasible to expect it to affect this quarter’s growth.
Nevertheless, this isn’t a good look for Salesforce’s stock.
3. Salesforce Is Still a Major Cloud Player
Despite the negative headlines and the fact that AI may not be the silver lining people were hoping for in 2024, Salesforce is still performing well in the Cloud CRM space.
They are the supreme market leaders in CRM and have market-leading products across Sales, Service, Marketing, CDP (Data Cloud), Integration (Mulesoft), Business Intelligence (Tableau), and Business Messaging (Slack). Salesforce sits amongst a minority of companies in the world that hold this kind of market dominance in the B2B sector.
Salesforce receives its fair share of criticism for a lack of integration and innovation between its products. There is no doubt that they have created an ecosystem of products that perfectly complement each other and aim to support the success of its customers.
Innovation may be something that Salesforce needs to work on in the coming years. An area that is particularly interesting to me is the agnostic approach Salesforce is taking to LLMs. You can now easily create Prompts, as well as choose models from different providers for different tasks.
In addition, with Parker Harris, Salesforce CTO and co-founder moving full-time to Slack, I’m sure we are going to see great things happen from the man who brought us the core Salesforce platform and Salesforce Lightning.
4. AI Hype
I’ve been pretty pessimistic about AI recently, which was highlighted in my recent article “Are We in a Dot-Com Style Artificial Intelligence Bubble?”. A lot of my pessimism stems from individuals hyping AI up exponentially over the past 18 months – AI has been completely overhyped and isn’t as ready as it’s been made out to be.
Whilst Nvidia has recently surpassed Microsoft to become the world’s most valuable company (As the old adage goes, sell shelves during a gold rush), many software companies will have to wait for huge revenue growth until end users are ready to embark on their AI adventure.
This may mean waiting until small internal AI pilots have been completed, or until digital transformations have been fully completed and systems are in a harmonious state with one another, or, simply waiting until the first wave of AI projects have possibly failed. Gartner predicts that by 2025, 90% of enterprise deployments of GenAI will slow, as costs exceed value.
5. AI Developer Tools to the Rescue
However, there is one use case for AI Apps that has been an instant hit, especially in the Salesforce community – Developers have adopted ChatGPT and other AI tools at an incredible pace. Of course, this was one of the first use cases for LLMs that astounded the global developer community and started raising existential questions about AI taking our jobs.
Writing Apex, Lightning Components, Test Classes, and just generally being a trusty sidekick for Developers, AI tools are used by 30% of Salesforce Developers every day (according to our upcoming Salesforce Developer Survey), and 41% are using it now and again.
As we all know, ChatGPT was the fastest-adopted technology in human history. But this kind of ongoing adoption just goes to show how powerful of a tool AI can grow to be.
6. Tech Layoffs
Although we were promised a much brighter economic future in 2024, the year started off rough, and the tech industry is still suffering. Global economy recovery is slow, and there is still a flurry of tech layoffs according to Layoffs.fyi.
At the start of the year, the Salesforce industry continued to have some notable layoffs from Salesforce themselves, large and small Salesforce consultancies, as well as AppExchange companies. There were also a small amount of Salesforce businesses also having to close up shop.
Whilst we are most definitely not out of the weeds yet, it does seem that the Salesforce ecosystem seems to have stabilized. We are moving away from a huge economic boom where all Salesforce consultancies couldn’t hire fast enough.
Now, only those who have a strong foothold in a particular industry or product niche can thrive. We are drifting away from a place where Salesforce skills as a whole are specialized, as they become more commoditized. Only those who can deliver real value, and focus on business outcomes instead of technology, can blossom in this environment.
7. Acquisitions
Between 2014 and 2020, there were huge sums of money flowing into the Salesforce ecosystem. Hundreds of millions of dollars of Venture Capitalist funding were flowing into ISVs, giving some AppExchange Companies valuations of up to $1B. In addition, larger Salesforce consultancies and ISVs were gobbling up their smaller counterparts as fast as they could to ensure they could support the rapid growth of the Salesforce ecosystem.
The landscape couldn’t be more different in 2024. VC money is focusing its efforts on AI, and Salesforce acquisitions are far and few between. But in May 2024, two mid-sized Salesforce consultancies, Cloud Orca and Sercante, were acquired in multi-million dollar deals.
This pointed to some clear signs that companies still want to get their foothold in the Salesforce ecosystem, as our Ohana looks to a reinvigorated future that is focused on Data and AI. SAP also acquired adoption giant, WalkMe, in a $1.5B deal, and Salesforce acquired compensation management software, Spiff.
8. Commoditized vs. Valuable Skills
There is no doubt that some Salesforce skills are becoming commoditized. The days of an Admin role simply administering users, adding permissions, and basic automation via workflows are long gone. The power of the Salesforce platform has grown exponentially in the past ten years with the addition of the Lightning Experience and declarative automation such as Flow, and companies want to maximize their expensive investment.
But most Salesforce organizations are far from perfect. They are riddled with technical debt or have misaligned business processes vs. technical implementation. Salesforce itself is also becoming increasingly more complex.
This opens the doors for a certain type of Salesforce professional: individuals who have years of experience, who have seen the pain points of bad implementations, people who know how to implement niche solutions for industries or products.
These types of Salesforce skills are going to be in demand for years to come.
9. Data Cloud Is Salesforce’s Main Focus
Ever since “Genie” (now called Salesforce Data Cloud) was announced at Dreamforce ‘22, it has become the flagship product for Salesforce’s new Einstein 1 agenda (CRM + Data + AI).
While some pivots in Salesforce’s marketing seem like a flash in the pan, Customer Data Platforms (CDPs), seem like a pretty safe bet for the foreseeable future.
The amount of data that we can capture about our customers is growing at a significant rate, and CRMs are no longer up to the task of sorting through and organizing data. Realistically, we wouldn’t even want this amount of data in our CRM, overwhelming our sales users and support agents.
Data Cloud has already been crowned the best CDP by Gartner in their annual magic quadrant, and is probably one of the biggest CDPs by revenue on the planet.
Although the market is tough at the moment, and Salesforce revenue is slowing down, they’ve hitched themselves to a product that seems to perfectly complement the rest of their product portfolio.
10. Changing Sentiment in the Salesforce Ecosystem
The Salesforce ecosystem has been described as a cult in the past, with many community members firmly “Drinking the Kool-aid”. But it does seem that with slowing growth, and the hype of the digital transformation boom of the last ten years reaching a level of maturity, ecosystem members are becoming less culty and more honest.
Salesforce is a fantastic platform; there is no doubt about it. But with many organizations riddled with technical debt, everyone is attempting to move slowly towards a place of harmony off the back of potentially incorrect implementations. This has encouraged the Salesforce ecosystem more honest about their own implementations, as well as how Salesforce can better support their existing platform instead of focusing on the next shiny new object.
Ultimately, this is a good thing. Less hype, bad practices, and vaporware, and more value-driven implementations that focus on positive business outcomes.
Summary
Throughout my years writing about Salesforce, I’ve always used the phrase “there’s never a dull moment in the Salesforce ecosystem”, and this is true even today. The ecosystem is changing in many ways, and it’s always wise to stay abreast of these rapid changes for the sake of your career and your org.
With our new research division within Salesforce Ben, we’re looking forward to bringing more data-driven insights to the ecosystem.
