AppExchange: SFDC's marketplace for on-demand applications

Raise a toast for the folks at salesforce.com for their latest innovation - the online marketplace for on-demand apps, launched this week. Neat strategy. Whittled down to its core, its basically better packaging for their partner network. And partner networks are very common in the software world. But the more interesting thing it says to me about Mr. Benioff and Co. is how they're looking at the staid enterprise software business with a refreshing new perspective - infusing it with a DNA more typical of consumer marketing.

AppExchange has the potential to benefit business software marketing the same way that Amazon helped book marketing. Both democratize access to the market, to customers, particularly for smaller entities that want to do business - AppExchange for software authors and publishers as Amazon does for book authors and publishers. As long as you can figure out the finances for creating and publishing your intellectual product, software in this case, the cost of bringing it to market and distributing it is dramatically lower with AppExchange. And there is a ready audience of potential customers - already over 17,500 businesses and 320,000+ users of salesforce.com - who participate in the market.

Ofcourse, doing business in this market is going to require that 3rd party software runs off SFDC's on-demand platform. AppExchange is thus SFDC's mechanism to attract and make it commercially worthwhile for a development community to build around their platform. Its an essential part of building towards their vision of being a general purpose, more universal sort of platform for on-demand applications.

So what else should be on their roadmap to make their vision a success? A quality certification process for on-demand apps sold on AppExchange would be a good idea, as also a score for each application on AppExchange based on a composite of the number of users, transaction volumes, data volumes, etc. I don't think the current user rating system will be as effective. Its a subjective measure for something that can be measured very objectively. That sort of measure is more suited if SFDC decides to create an online market for SFDC developer skills once they have a sufficient community around their platform. The developer market would also be amenable to an Elance-style bidding model, and SFDC may just find a big community of software writers and publishers in markets like India. At some point in the future, an SFDC university that imparts training and certifies development skills for the SFDC platform may also be worthwhile.

All of this is pretty damn exciting. A business software company that's as dot-com as can be, adept at applying consumer marketing principles to SMB marketing. They're truly showing the Microsoft and Intuit sort of genes, only without the legacy of older technology & business models, and I doubt there is another on-demand play that has the same sort of DNA, and traction, and can challenge them yet.