Google & Salesforce.com – folly or future?

Mergers, Acquisitions and Partnerships… seems like every time you look at or listen to the news, some organization somewhere has decided bolster their business by throwing money at Internet start-ups. So why does the Google-Salesforce.com partnership warrant a second look. After all – it is a partnership… not the acquisition of Salesforce.com by Google that many were expecting. Let’s consider the landscape in which this news comes out…

Online advertising in the first half of this year has exploded. Organizations the world over consider the web as being as important, if not more so, than traditional channels. And this in turn explains the hyper activity in the Internet space with the likes of Google, Yahoo and Microsoft snapping up online advertising companies. Add to this the fact that Google and Salesforce.com believe in a new paradigm of operation that does not tie the user to their desktop, thereby challenging the the very foundations of the companies like Microsoft and Oracle.

The partnership has yielded the Salesforce.com Group Edition which ‘integrates’ Google AdWords into Salesforce.com, thereby allowing marketing departments in small and mid-sized companies to more easily place and manage their search engine marketing efforts and then seamlessly pass the resulting leads to their sales teams. A great idea given the value of online advertising and search engine marketing for small and medium sized businesses.

Now the strategic direction that both these companies have been taking for some time now. Google has been creating its own ‘office productivity tools’ in Google Apps. And Salesforce.com has taken the platform track — touting its existing infrastructure and offerings as the basis for the ‘world’s first multi-tenant, on-demand platform’ called Apex. Is the picture becoming a little bit clearer? Applications by Google – Platform by Salesforce.com? Sounds like a formidable combination to take on the likes of Microsoft, especially in the SMB space and also for the little guys just starting up.