Marc Benioff and the Million Dollar Orange
March 1, 2009 by Jimson Lee · Leave a Comment
There’s an old story about a guy who had a fruit stand.
On the fruit stand there was a single orange with a price tag hanging on it.
The price? One million dollars.
People asked him all the time, “Why on earth are you charging one million dollars for an orange?
Who in hell is going to buy it?”
His reply: “I don’t know, but I only have to sell one!”
Marc Benioff and Salesforce.com reminds me of the customer asking the question, not the guy selling the one million dollar orange.
Why?
Because Marc doesn’t want to sell you a one million dollar orange. He wants to sell you a million, ONE dollar oranges.
Why? Because it’s much easier to sell a one dollar product than a million dollar product.
In this case, on the 10th anniversary of Salesforce.com, it looks like he was onto something 10 years ago by offering a subscription service for software.
Unless you are the United Nations with enough money to spend over a million dollars on SAP, most people would be glad to pay a moderate amount each month for use of a productivity tool to help you make money.
And this recession is perfect a time for that kind of business model.
Happy Anniversary Marc. And have a Mimosa on me.
By the way, a Mimosa is Champagne and Orange Juice!
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About Jimson Lee
Jimson is a freelance industry analyst, with over 25 years experience in the IT industry. Prior to joining CRMHelpDeskSoftware, he spent 4 years as a Senior Consultant at Sierra Systems Group, part of Golden Gate Capital, a leading private equity firm with $9 billion in capital under management. Jimson currently resides in Rome, Italy.
