I’m excited to announce the release of our 4th Annual State of AppExchange Partners Report. Over the past 4 years, the scope and shape of our report have changed. What started with the release of our first report in 2017 at Dreamforce has grown to become our most requested asset each year.
Our State of AppExchange Partner Report provides an independent look at the Salesforce AppExchange and shares insight for those who are building their business there. In this year’s report, we examine the concept of The Great Separation and why partners in the ecosystem are experiencing unprecedented resiliency in the face of so much change.
With 46% of our respondents stating they are expecting to surpass their original revenue projections, this doesn’t sound like an ecosystem that is struggling. There are 3 common characteristics for companies who are thriving and carving out their lead as part of The Great Separation.
- They are repackaging existing technology into new solutions that solve the challenges customers are facing.
- Said solutions are positioned as business continuity rather than digital transformation.
- The companies are all investing heavily in R&D, Sales, and Marketing.
Our report is broken down into 6 sections, and you’ll discover how other AppExchange partners are leveraging Salesforce in the following categories:
- Product & Company
- Technology & Platform
- Salesforce as a Channel
- Diversity & Inclusion
- Investment (powered by Crunchbase)
Long-time readers and followers of this report may notice an additional section this year: Diversity & Inclusion.
In our Executive Summary, CodeScience CEO, Brian Walsh, explains why we feel it is important to surface the stories and stats around D&I:
The tragic racial and social injustice events this year have brought a new focus on systemic issues that continue to plague the US. A dear friend of CodeScience encouraged us to use the platform of the State of the AppExchange Partners Report to explore how the AppExchange ecosystem is working through diversity and inclusivity issues, and we are thankful for the encouragement. We are committed to having this be a permanent addition to our annual report.
Highlights and Trends
Here are a few highlights from our report to read and share, but we encourage each of you to download the report in full.
This year’s response for the top reasons partners chose to leverage the AppExchange represented the first major change to our survey. Where previously we asked partners the reason they chose the AppExchange, we now asked, “What attributes of the Salesforce platform and the AppExchange will be most critical to your organization’s ability to successfully navigate the post-pandemic marketplace?”
What is it about the Salesforce ecosystem that makes it so unique? Often, it is Salesforce’s strategic leadership and initiative to pave the way for partners to follow along. Each of the three attributes noted above (access to the install base, Salesforce’s credibility with customers, and ability to pivot and get to market quickly) are values that Salesforce’s leadership has enabled through the product they’ve built and the community they’ve fostered.
In examining the findings of the top 3 challenges partners face, Acquiring New Customers takes the number 1 spot. This is the 4th year in a row that our respondents noted this as their primary challenge. Second to that is Evolve our product offering. Acquiring new customers and evolving product offerings reiterate that the old way of doing business is no longer an option, and business leaders must understand how their solution can become part of the Great Separation.
The tertiary challenge of Hiring employees may seem surprising given broad economic trends, but in digging into the results deeper, we find that this challenge is in response to the radical shift of what it means to be an employee with a company. No longer is hiring about volume. But rather, hiring, training, and maintaining the right employees. Businesses are asking the question — how do I find, identify, and onboard employees without offices or in-person events and make them feel like they are part of the culture.
Since the inception of our report, we have asked partners about the impact of the partner program to their revenue. We found that there tends to be an inflection point based on the maturity of the partner and the value they see from the program.
With the many tasks, operations, and investments it takes to get started as a successful AppExchange partner, this inflection point is unsurprising. We will continue to examine in future iterations of the report if there is a correlation between R&D investment and the perceived impact of the partner program.
But what about investments and acquisitions in the ecosystem?
As we were putting the final touches on the report, major M&A activity happened in the ecosystem. Vista Equity Partners announced the acquisition of Gainsight for $1.1B, and Salesforce confirmed their purchase of Slack for $27.7B.
With the continued support from our friends at Crunchbase, we found that as of September 2020, the ecosystem raised 83% of the capital it raised in 2019 — which equates to $3.1B!
I’ll refer back to Brian’s message to partners for what we hope readers get from this report.
“Ultimately, the message we are bringing to partners for this year’s report is a message of opportunity. When the clock struck midnight and the calendar turned to January 1st, no one could have predicted what this year would hold. While the definition of normal has changed, while unrest and injustice plague our country, all organizations are searching for their opportunity to grow and succeed. Whether you are thriving already or just now finding your footing, the ecosystem provides a path to move forward.”
We invite you to download our report here: https://learn.codescience.com/state-of-appexchange-partners-report-2021