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Salesforce's foray into IoT extends personalized CRM

Salesforce's venture into the IoT Cloud is yet another prong in its strategy to create personalized CRM and tailor customer experiences.

The Internet of Things (IoT) is enabling companies to think about customer data in new ways. IoT allows companies to know far more about customers and to tailor new services to them based on this data. The opportunities to create even more personalized customer interactions abound, and that is what Salesforce, the leader in cloud-based CRM software, is betting on with its new IoT Cloud offering.

IoT-connected devices transmit information via the Internet about customers' use of products, product status and so forth -- and without human intervention. Salesforce sees an opportunity to use IoT to further extend its personalized CRM strategy to capture customer data in increasingly granular ways. Salesforce CEO Marc Benioff outlined his vision for more personalized CRM data at this year's Dreamforce conference, Salesforce's annual show. Benioff likened it to the precision medicine trend, in which patients receive tailored therapies based on their individual profile rather than a general diagnosis. This kind of personalized CRM strategy will take shape, of course, in Salesforce's new healthcare offering -- known as the Health Cloud -- which it rolled out this year as well.

The import of IoT to a personalized CRM strategy

The prospect of 25 billion connected devices by 2020, according to Gartner Inc., has captured the imaginations of corporate executives because it promises to enable them to better serve customers, support products and gain an advantage in an increasingly competitive marketplace.

The IoT idea expands on the established success of a more narrowly defined world of machine-to-machine (M2M) networks. The previous generation of connected things was deployed primarily in industrial environments, which could be better instrumented using sensors to feed data back to systems designed to continuously improve their operational efficiency.

Today, IoT promises to enable companies to react more quickly when their products and services fail.

New advancements in nanotechnology and the ubiquitous availability of cloud services have made it economically feasible to apply the M2M model into new environments. We can now place sensors anywhere, connect them via increasingly pervasive networks, capture the growing volume of data they generate and analyze the information to perform a widening array of business functions.

Over the past decade, Salesforce has succeeded in redefining the way software is developed, sold and delivered with the software as a service model. It has also redefined the role of personalized CRM by making the application the system of record -- or the source of truth in an environment of siloed, inconsistent data -- for every customer interaction. And Salesforce has used CRM in concert with back-office functions to create a more integrated customer experience. Now, it wants to apply a similar integration to IoT and make CRM the conduit for tracking things.

Today, IoT promises to enable companies to react more quickly when their products and services fail, and in the future, IoT could remedy potential problems proactively before they happen by monitoring how they're being used on an ongoing basis. However, fulfilling these promises requires aligning the data from these products and services with the associated customer records.

The IoT Cloud is powered by a purpose-built platform called "Thunder" to handle massive data workloads and process billions of alerts that can trigger a variety of IoT-driven business processes. Salesforce claims the rules-based processing engine will be able to convert data prompts from various endpoints into automated service, sales and marketing actions that can reduce response times, improve customer intimacy and create new revenue opportunities.

Salesforce is also offering a user-friendly development platform known as Lightning to enable citizen developers within organizations and third-party software developers to create the rules that govern IoT business processes. Of course, these actions will be best performed if a company also uses Salesforce's Sales, Service and Marketing Clouds.

Salesforce is attempting to position its new IoT Cloud so that personalized CRM is squarely in the middle of the myriad of business processes potentially impacted by IoT. If successful, it will dramatically expand the role of CRM as the system which records and controls the behavior of the rapidly growing universe of connected products and services.

Next Steps

Microsoft-Salesforce partnership could open doors for IoT Cloud

IoT adoption still slow to gain steam

Look out for IoT data governance challenges

Salesforce unveils IoT Cloud at Dreamforce 2015

Dig Deeper on Salesforce CRM