The Total Economic Impact™ Of Salesforce For Consumer Goods
Cost Savings And Business Benefits Enabled By Salesforce For Consumer Goods Companies
A Forrester Total Economic Impact™ Study Commissioned By Salesforce, September 2024
Consumer goods companies use Salesforce to unify planning and execution of route-to-market activities. The Salesforce platform helps these organizations drive business growth, improve the productivity and effectiveness of sales representatives and service personnel, and optimize their technology investments.
Salesforce offers verticalized customer relationship management (CRM) solutions, including Consumer Goods Cloud, that enable consumer goods organizations to leverage workflows, data models, and capabilities that are purpose-built for their organizations. These solutions enable consumer goods companies to manage retailer relationships and customer sales at scale and drive profitable growth.
Salesforce commissioned Forrester Consulting to conduct a Total Economic Impact™ (TEI) study and examine the potential return on investment (ROI) enterprises may realize by deploying Salesforce.1 The purpose of this study is to provide readers with a framework to evaluate the potential financial impact of Salesforce on their organizations.
Return on investment (ROI)
205%
Net present value (NPV)
$20.7M
To better understand the benefits, costs, and risks associated with this investment, Forrester interviewed four representatives of consumer goods organizations with experience using Salesforce. For the purposes of this study, Forrester aggregated the interviewees’ experiences and combined the results into a single composite organization that sells consumer goods and generates $5 billion in annual revenue.
Interviewees said that prior to using Salesforce, their organizations used a myriad of disconnected CRM systems, point solutions, and spreadsheets to drive operations. These prior environments hindered productivity, drove inconsistency in processes and customer experiences (CX), and lacked integration of business data. These limitations made it difficult for organizations to implement strategies and adapt to changing customer and consumer preferences.
After the investment in Salesforce for consumer goods, the interviewees noted their organization used the platform to unify customer and operational data — they were better equipped to implement sales and service strategies, and could leverage automations and tools to improve the efficiency and effectiveness of customer-facing personnel. Key results from the investment included increased revenue, productivity gains, and cost savings.
Key Findings
Quantified benefits. Three-year, risk-adjusted present value (PV) quantified benefits for the composite organization include:
- Increased top-line revenue growth by up to 0.5%. Salesforce provides the composite organization with a centralized platform to manage customer account and operational data, and unified tools to drive sales opportunities and retail execution activities, which drive top-line growth. The platform enables the composite organization to orchestrate and track unified sales processes, leverage customer and opportunity insights, increase in-store visibility and demand for products with consumers, and foster customer relationships through more effective retail execution. The composite generates incremental revenue through acquiring new customers, growing sales in existing accounts, driving demand for new products, driving cross-sell opportunities, and improving its share of in-store shelf space. Over three years, the incremental profit for the composite organization is worth $4.8 million.
- Improved productivity of each sales representative by three hours per week through data centralization, reporting automations, and retail execution tools. Salesforce empowers sales reps with in-platform tools and workflows to streamline in-store retail execution activities like merchandising, inventory management, audits, and promotions management. The platform also provides intelligent route planning to minimize travel time. A centralized platform to record and view relevant account, sales, and operational information combined with process automations, enables sales reps to be more productive as it reduces manual tasks and information gathering. Sales reps can reallocate these time savings to spend more time with customers, better understand their needs, and uncover further opportunities to provide additional value. The recaptured productivity is worth $20.8 million for the composite organization.
- Reduced call center costs by up to 15%. Salesforce provides customer service representatives with a unified agent console to view key account and historical case information without the need to toggle between systems. This offers agents a single place to track and manage a case to resolution. Salesforce enables agents to be better equipped to handle cases with greater efficiency, reducing case handling time. Thus, the composite organization deflects a significant volume of cases from high-cost channels like telephony to lower-cost channels, including self-service, web-to-case, live agent chat, and chatbots. The improved efficiency and case deflection drives call center cost savings of $889,000 over three years.
- Avoided annual licensing costs of up to $4.3 million. The composite organization rationalizes its legacy technology stack with the adoption of Salesforce. The organization decommissions legacy CRM systems, point solutions, and homegrown applications that had previously been used in silos across different regions of the business. Over three years, avoided technology costs total $4.3 million.
Unquantified benefits. Benefits that provide value for the composite organization but are not quantified for this study include:
- Improved margins. Implementing Salesforce enables the composite to streamline operations, reduce manual processes, and improve decision-making around resource optimization and contract terms.
- Partner enablement. Partners can securely access the Salesforce platform, which improves data sharing and collaboration for more coordinated customer engagement.
- Better contact lifecycle management (CLM) and compliance. CLM workflows automate contract generation, which drives efficiency for sales reps and ensures accurate and compliant contract terms.
- Trade promotion management. Salesforce’s Trade Promotion Management capabilities empower account managers to streamline promotion planning, manage funds and budgets, simplify claims management, and leverage reporting and analytics, which optimizes trade spending and improves productivity.
Costs. Three-year, risk-adjusted PV costs for the composite organization include:
- Licensing costs. The composite organization incurs $2.6 million in Salesforce licensing costs over three years.
- Implementation and integration costs. The composite organization involves several internal resources and a systems integrator (SI) during the implementation of Salesforce. The cost of the implementation, including integration costs, totals $5.3 million over three years.
- Training and ongoing management costs. Each Salesforce user participates in two hours of training on Salesforce. The organization also has five technical and business resources dedicated to ongoing platform management and updates. Over three years, the training and ongoing management costs total $2.3 million.
The representative interviews and financial analysis found that a composite organization experiences benefits of $30.8 million over three years versus costs of $10.1 million, adding up to a net present value (NPV) of $20.7 million and an ROI of 205%.
Key Statistics
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Return on investment (ROI)
205%
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Benefits PV
$30.8M
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Net present value (NPV)
$20.7M
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Payback
<6 months
Benefits (Three-Year)
Increased revenue growth Improved sales rep productivity Call center cost savings Technology savings
TEI Framework And Methodology
From the information provided in the interviews, Forrester constructed a Total Economic Impact™ framework for those organizations considering an investment Salesforce.
The objective of the framework is to identify the cost, benefit, flexibility, and risk factors that affect the investment decision. Forrester took a multistep approach to evaluate the impact that Salesforce can have on an organization.
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Due Diligence
Interviewed Salesforce stakeholders and Forrester analysts to gather data relative to Salesforce.
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Interviews
Interviewed four representatives at organizations using Salesforce to obtain data about costs, benefits, and risks.
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Composite Organization
Designed a composite organization based on characteristics of the interviewees’ organizations.
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Financial Model Framework
Constructed a financial model representative of the interviews using the TEI methodology and risk-adjusted the financial model based on issues and concerns of the interviewees.
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Case Study
Employed four fundamental elements of TEI in modeling the investment impact: benefits, costs, flexibility, and risks. Given the increasing sophistication of ROI analyses related to IT investments, Forrester’s TEI methodology provides a complete picture of the total economic impact of purchase decisions. Please see Appendix A for additional information on the TEI methodology.
Disclosures
Readers should be aware of the following:
This study is commissioned by Salesforce and delivered by Forrester Consulting. It is not meant to be used as a competitive analysis.
Forrester makes no assumptions as to the potential ROI that other organizations will receive. Forrester strongly advises that readers use their own estimates within the framework provided in the study to determine the appropriateness of an investment in Salesforce.
Salesforce reviewed and provided feedback to Forrester, but Forrester maintains editorial control over the study and its findings and does not accept changes to the study that contradict Forrester’s findings or obscure the meaning of the study.
Salesforce provided the customer names for the interviews but did not participate in the interviews.
Drivers leading to the Salesforce investment
Interviews
| Role | Industry | Geography | Revenue | Employees |
|---|---|---|---|---|
| Director of strategy and transformation | Food and beverage | Headquartered in the US, global operations | Region: $26 billion | 40,000 |
| Vice president of enterprise sales effectiveness | Food | Headquartered in the US, global operations | $6 billion | 14,000 |
| Group transformation lead | Beverage | Headquartered in the APAC, global operations | Region: $4 billion | 28,700 |
| Trade promotion analyst | Food | Headquartered in the US, global operations | $1.5 billion to $1.9 billion | 6,700 |
Key Challenges
Before adopting Salesforce, the interviewees’ noted their organizations relied on disparate systems, point solutions, homegrown applications, and spreadsheets to plan and orchestrate sales, customer service, retail execution and other operational activities. The interviewees’ organizations had grown organically and through acquisitions, leading to different regions and divisions using different tech stacks.
The interviewees noted how their organizations struggled with common challenges, including:
- Inconsistency across different regions and business units that created disjointed CX and missed sales opportunities. As different divisions and groups operated on disconnected systems and applications, the lack of a holistic account view due to data silos created inconsistencies in how the individual groups operated. This led to reduced data sharing and created disjointed CX. The group transformation lead at a beverage organization said: “We didn’t have a single view of our customer. We weren’t able to see all the different interactions that people from different divisions were having with customers. This led to an inconsistent customer experience. For example, our alcohol and non-alcohol businesses sometimes overlapped and needed to call on the same customer. The customer thinks of us as one company, but we were giving them two completely different experiences. This caused problems because our reps didn’t know what the other rep was doing. We couldn’t know if one rep had annoyed a customer and then the next minute our other rep goes in and tries to sell to them, but they are still angry at our company.” The interviewees also noted that finding a solution to reduce silos between sales reps was necessary to improve CX.
- Difficulty implementing sales strategies. Interviewees shared that their organizations’ disparate legacy technologies made it difficult to efficiently drive consistent sales strategies and priorities. Additionally, as different divisions often followed different sales processes, many of the interviewees’ organizations lacked the ability to consistently track KPIs across the business and identify opportunities to optimize efforts. Notably, a lack of integration made it difficult to connect business data and track and measure performance metrics associated with initiatives. The director of strategy and transformation at a food and beverage organization said: “When you have sales strategies and sales priorities, how do you communicate them effectively so that they can be executed fully? How do you then measure that performance adequately? Those things were challenging. We had some pretty advanced homegrown applications to do it, but they were all on different databases and we had big integration challenges.”
- Lack of business insights due to siloed data. Interviewees highlighted that it was imperative for their organizations to keep up with rapidly changing consumer preferences. However, as transactional data were siloed across regional systems and applications, the interviewees’ organizations lacked the ability to surface holistic analytics. The director of strategy and transformation at a food and beverage organization noted: “We have a lot of competitors in this space. We’re also dealing with a rapidly changing retail marketplace. So, the venues in which consumers find our products has been changing with the rise of dollar stores and e-commerce. We also have to deal with the changing tastes of consumers, which are rapidly evolving. We are constantly expanding our portfolio into new areas that we probably never were in before.” To keep up with the speed of change, the interviewees’ organizations needed more holistic insights to help them understand white spaces and identify cross-sell and upsell opportunities within accounts.
- Disparate systems and tools reduced productivity. Sales reps at the interviewees’ organizations managed information across multiple applications and spreadsheets, requiring high levels of manual work that were redundant, error prone, and negatively impacted productivity. The group transformation lead at a beverage organization noted how having different systems and spreadsheets to store customer account information, track sales opportunities, and input orders led to inefficiency: “Historically, when we did product launches, all the reps would have gone out and visited their customers and logged into a shared drive, whether or not they were interested. They would have manually filled out a spreadsheet and logged whether the customer wanted the product — and if they did — how many cartons they agreed to purchase. It all would have had to be entered manually and then coordinated by a sales operations person who would run the reports and then place the orders.” In order to scale without adding additional sales headcount, the interviewees noted the need for technology to drive more efficiency.
- High IT management costs. Interviewees noted that technology sprawl also led to unnecessarily high IT costs. Both the vice president of enterprise sales effectiveness at a food organization and the director of strategy and transformation at a food and beverage organization shared that their organization had built dozens of homegrown applications. These applications led to technical debt that required significant resources for ongoing maintenance and support, and would necessitate custom development for new feature enhancements, that made them prohibitive to modernize.
Why Salesforce?
The interviewees’ organizations searched for a solution to address their key challenges and selected Salesforce because it offered:
- A scalable, performant, and globally-available solution. The director of strategy and transformation at a food and beverage company said: “There’s a lot of CRM providers out there and one of the reasons we chose Salesforce was because it had been used to some extent in our Latin-American business and our snacks division. Salesforce was widely recognized as an industry leader and provider of a world-class solution.”
- Configurability. Several of the interviewees noted their organizations looked to move away from highly-customized and homegrown solutions but still needed the ability to configure their CRM capabilities based on their businesses’ specific needs. The vice president of enterprise sales effectiveness at a food company noted that another CRM offering from a different vendor they evaluated was more rigid and did not offer the same level of configurability that Salesforce did. The director of strategy and transformation said, “We decided to go with an enterprise-class solution that we could build to fit our business rather than building custom solutions.”
- Continued enhancement through three releases per year. Salesforce has three releases per year, which the vice president of enterprise sales effectiveness at a food company highlighted as advantageous. Each release made new features and enhancements available to their organization, which unlocked additional value.
- Industry CRM. Salesforce Consumer Goods Cloud is an industry CRM solution that provides packed workflows, data models, and intelligent user experiences that is purpose-built for the needs of consumer goods organizations. The solution offers the interviewees’ organizations with verticalized core CRM capabilities in addition to prepackaged workflows and tools that are easy to deploy, accelerating time to value.2
Composite Organization
Based on the interviews, Forrester constructed a TEI framework, a composite company, and an ROI analysis that illustrates the areas financially affected. The composite organization is representative of the four interviewees, and it is used to present the aggregate financial analysis in the next section. The composite organization has the following characteristics:
Description of composite. The composite organization sells products primarily through retail channels for consumer use. The global company generates $5 billion in annual revenue and has grown both organically and through acquisition. The organization has 25,000 employees, 1,750 of which are sales reps. The composite also has an outsourced call center that provides customer service to both its retail channel customers and its products’ end consumers.
Deployment characteristics. The composite organization previously had multiple technology stacks used by different regions and divisions of the business, leading to significant technology sprawl. The composite adopts Salesforce Consumer Goods Cloud to unify its CRM system across the organization and to leverage its industry-specific data model and solutions. It deploys the solution to 2,000 total users including sales reps, contact center agents, and other key business resources. The organization also adopts Service Cloud to drive greater customer service efficiency.
Consumer goods use cases. The composite organization uses Salesforce to orchestrate retail execution, manage sales cycles with retailers and wholesalers, and leverage in-platform capabilities for account planning, forecasting, trade promotion management, optimized routing, and contract lifecycle management. Sales reps access the Salesforce platform through the mobile application when they are in the field visiting customers.
Quantified benefit data as applied to the composite
Total Benefits
| Ref. | Benefit | Year 1 | Year 2 | Year 3 | Total | Present Value |
|---|---|---|---|---|---|---|
| Atr | Increased revenue growth | $1,485,000 | $1,980,000 | $2,475,000 | $5,940,000 | $4,845,868 |
| Btr | Improved sales rep productivity | $7,973,438 | $8,374,388 | $8,793,563 | $25,141,388 | $20,776,295 |
| Ctr | Call center cost savings | $184,500 | $369,000 | $553,500 | $1,107,000 | $888,539 |
| Dtr | Technology savings | $900,000 | $1,800,000 | $2,700,000 | $5,400,000 | $4,334,335 |
| Total benefits (risk-adjusted) | $10,542,938 | $12,523,388 | $14,522,063 | $37,588,388 | $30,845,037 | |
Increased Revenue Growth
Evidence and data. Since adopting Salesforce, interviewees reported sales growth derived from new customer acquisition, growth in existing accounts, new product launches, cross-sell effectiveness, and growth in shelf space. The improvement to top-line revenue growth averaged 0.44% across the interviewees’ organizations. Interviewees shared several ways that Salesforce helped improve their sales organizations and outcomes:
- Unified sales processes. Before Salesforce, sales initiatives and territory plans were often captured and communicated through disparate systems or spreadsheets, making it difficult to implement them and measure performance across regions. Adopting Consumer Goods Cloud enabled a unified platform to plan, communicate, execute, and track sales processes and initiatives. The director of strategy and transformation at a food and beverage organization noted how the solution orchestrated new business acquisition efforts: “We were using syndicated data sets and spreadsheets to distribute plans to our business acquisition teams. It was a very fragmented offline process before. Now, we are able to curate all that external data and deliver it directly to our new business sales reps. So, we have an integrated leads prospecting approach that’s all managed through Consumer Goods Cloud. They can go out and pitch prospects, identify what opportunities exist, pre-qualify those customers, and convert them directly through the application to get them signed up as a customer.”
- Account and opportunity management. The interviewees’ organizations leveraged account and opportunity management workflows in Consumer Goods Cloud to better track, organize, and manage sales efforts. Additionally, as all sellers followed consistent processes around account and opportunity management, it was much easier for the interviewees’ organizations to understand how their companies were tracking against quotas globally. Interviewees noted that opportunity management helped sales reps track opportunities through each stage of the sales funnel and prioritize based on deal value and the likelihood of closing. This ensured sales reps focused their efforts on the most promising deals. The vice president of enterprise sales effectiveness at a food organization noted that opportunity scoring contributed to improved lead-to-close times: “If we can’t call on everybody, how do we call on the right people and understand which opportunities are better than others? Our goal is to take the 10 best opportunities and get them through the funnel quickly and then go back up and get the next 10. Salesforce advises us to focus on the opportunities that have the greatest likelihood of success based on various factors. That drives the effectiveness we want.”
- Retail execution tools. Interviewees shared that tracking and auditing capabilities helped their organizations monitor and improve in-store retail execution metrics, including share of shelf, share of tap, and number of promotional displays built, which increased visibility and demand for their products and managed in-store promotions. The director of strategy and transformation at a food and beverage organization noted that Consumer Good Cloud provided sales representatives with shelf space auditing capabilities that utilized image recognition for faster and more accurate monitoring. They noted how this tool supported sales growth in its mom-and-pop segment of the business.
- Unified view of customer data. Moving away from using disparate systems, tools, and spreadsheets to record information to utilizing a consolidated platform for planning and execution enabled the interviewees’ organizations to gain a single source of truth around their customers. This enabled better decision-making and improved sales reps’ visibility and understanding of customer needs, leading to more informed and productive customer visits. The director of strategy and transformation at a food and beverage organization shared: “Instead of ad hoc processes for selling into an account, sales reps know exactly what to go for when they visit a customer. So, they look a lot smarter when they walk into a store. Before, we may have been recommending the wrong products or things that didn’t work as well. Now, they’re able to be more targeted in their conversations. That has proven to be very effective for us.”
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
- It generates $5 billion in annual revenue before the Salesforce investment.
- After the Salesforce investment, the organization improves sales execution with Salesforce as the supporting technology. As a result, the organization measures an increase to topline growth directly attributable to Salesforce of 0.3% in Year 1, 0.4% in Year 2, and 0.5% in Year 3.
- It has a profit margin of 11%.
Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this benefit will vary depending on the following:
- The volume of revenue generated before Salesforce.
- The effectiveness of change management for sales reps adopting the new technology and processes to support using Salesforce and the extent to which Salesforce technology and sales processes drive greater sales efficacy.
- Margins in the prior environment.
Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $4.8 million.
Increased Revenue Growth
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| A1 | Revenue before Salesforce | Composite | $5,000,000,000 | $5,000,000,000 | $5,000,000,000 | |
| A2 | Top-line growth attributed to Salesforce | Interviews | 0.3% | 0.4% | 0.5% | |
| A3 | Incremental revenue driven by Salesforce | A1*A2 | $15,000,000 | $20,000,000 | $25,000,000 | |
| A4 | Profit margin | Composite | 11% | 11% | 11% | |
| At | Increased revenue growth | A3*A4 | $1,650,000 | $2,200,000 | $2,750,000 | |
| Risk adjustment | ↓10% | |||||
| Atr | Increased revenue growth (risk-adjusted) | $1,485,000 | $1,980,000 | $2,475,000 | ||
| Three-year total: $5,940,000 | Three-year present value: $4,845,868 | |||||
Improved Sales Rep Productivity
Evidence and data. Interviewees shared several ways that Salesforce drove sales rep productivity, including:
- Retail execution tools. Interviewees noted that Consumer Goods Cloud provided sales reps with several tools that streamlined various in-store retail execution activities, including merchandising, inventory management, audits, and promotions management. Previously, these tasks were typically handled through spreadsheets or disparate mobile solutions. The group transformation lead at a beverage organization shared that sales reps leveraged in-store activity checklists and execution tools within the Salesforce platform to more efficiently manage product availability and placement, ensure promotional materials were visible, and better capture data to ensure that merchandising was executed as intended at retail locations. They shared: “When they go to execute a call, Salesforce will give them a list of tasks that they need to achieve during that visit. Then we can capture customer information and check whether certain activities were executed. We can monitor whether promotional displays are built, whether the customer accepted and put up promotional materials that we sent, and check on our share of shelf within that retailer. It’s allowing us to capture data around the way that we execute and track whether we were improving in that store.”
- Intelligent route planning. Optimized routing between scheduled appointments helped sales reps at the interviewees’ organizations minimize travel time. Incorporating real-time traffic data and dynamic routing, the tool enabled reps to optimize their sequence of planned visits for a day and adapt to changing conditions in the event of road closures or rescheduling needs. The vice president of enterprise sales effectiveness at a food company reported that the tool was saving two days of driving time per year for each field representative.
- Centralized information and tools. In the prior environments, sales reps at the interviewees’ organizations lacked a centralized platform to record and view relevant customer, sales, and operational information. This required them to duplicate efforts across multiple systems, tools, and spreadsheets during the course of the day, negatively impacting their productivity. Adopting Consumer Goods Cloud enabled the interviewees’ organizations to gain a single source of truth across business data, which allowed them to be more organized, have more informed conversations with customers, and be able to quickly surface information, including account details, delivery status, transactional data, and input orders. The group transformation lead at a beverage organization said: “Sales reps are more organized because everything is sitting in one system. They have their journey plans, so they know where they are going to be and what they need to do over the next several weeks. Having all their customers’ contact details and information stored in one system is a big benefit.”
- Reallocated time toward nurturing relationships with customers. Interviewees highlighted that the time savings driven by Salesforce enabled sales reps to spend more time interacting with customers to understand their needs and nurture opportunities. The group transformation lead at a beverage organization said: “Based on our time motion studies, we’ve observed that, on average, about 50% of our sales reps’ time is spent with customers and the other 50% is spent on activities like driving, internal meetings, and working on development plans, administrative tasks, or proposals. What Salesforce is doing is increasing the percentage of time spent with customers, because it cuts down on things like admin.”
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
- The composite organization has 1,750 sales reps in Year 1. The number of sales reps grows by 5% each following year to 1,838 in Year 2, and 1,930 in Year 3.
- Salesforce provides sales reps with a consolidated view of account, opportunity, and order information, in addition to retail execution tools. This enables the sales reps to work with greater efficiency and reduce manual work, saving 156 hours per year or three hours per week.
- The annual fully-burdened cost of a sales rep is $67,500.
Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this benefit will vary depending on the following:
- The level of Salesforce adoption by sales reps.
- The number of sales reps.
- The effectiveness of change management for sales reps adopting new technology and processes to support the use of Salesforce, and the extent to which Salesforce technology and sales processes drive greater sales efficacy.
- The average fully-burdened cost of a sales rep, which can vary based on location, tenure, and years of experience.
- Utilization of features within the platform.
Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $20.8 million.
Improved Sales Rep Productivity
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| B1 | Sales reps | Composite | 1,750 | 1,838 | 1,930 | |
| B2 | Hours saved with Salesforce per sales rep | Interviews | 156 | 156 | 156 | |
| B3 | Annual fully-burdened cost of a sales rep | Composite | $67,500 | $67,500 | $67,500 | |
| Bt | Improved sales rep productivity | B1*B2*B3/2,080 | $8,859,375 | $9,304,875 | $9,770,625 | |
| Risk adjustment | ↓10% | |||||
| Btr | Improved sales rep productivity (risk-adjusted) | $7,973,438 | $8,374,388 | $8,793,563 | ||
| Three-year total: $25,141,388 | Three-year present value: $20,776,295 | |||||
Call Center Cost Savings
Evidence and data. Both the vice president of enterprise sales effectiveness at a food organization and the group transformation lead at a beverage organization shared how their organizations used Service Cloud within their call centers to manage and resolve customer inquiries. They both noted that Salesforce improved service efficiency and reduced costs in the following ways:
- Provided service agents with better access to information and case tracking. The vice president of enterprise effectiveness noted that Salesforce provided agents with a unified service console to track cases across their lifecycles. With case details and key account information integrated into the platform, agents were better equipped to handle cases with greater efficiency, reducing the need to swivel chair between systems and cutting case handling times.
- Deflection of cases to lower-cost channels. The interviewees shared that Salesforce deflected cases from phone intake to lower cost channels, including self-service, live-chat, and web-to case. For example, the group transformation lead at a beverage organization noted that Salesforce enabled cases to be handled through live agent chats instead of via email and phone. The same interviewee noted that each agent could handle up to four live-chat cases concurrently, making it a more cost-effective service channel. The interviewee also shared that the organization was in the process of deploying Service Cloud to its other call center and adding the chatbot functionality, which would drive additional deflection and cost savings.
- Reduced service agent headcount needs. The vice president of enterprise sales effectiveness at a food organization estimated that call center costs were reduced by 50% as a result of the agent efficiency gains and case deflection enabled by Salesforce. The group transformation lead at the beverage organization noted that Salesforce was helping to drive the organization’s five-year plan to reduce headcount by 56%.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
- It incurs $4.1 million in annual call center costs before adopting Salesforce.
- Salesforce enables it to improve agent efficiency and deflect a significant volume of cases to lower-cost channels, which reduces headcount needs. As a result, call center costs are reduced by 5% in Year 1, 10% in Year 2, and 15% in Year 3.
Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this benefit will vary depending on the following:
- Call center costs, case volumes, and customer service channels prior to adopting Salesforce.
- Integration of key information required to drive service efficiency.
- Resources and costs required to manage adopted channels like chatbots and self-service.
- Change management for developing agent skills and training on Salesforce.
Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $889,000.
Call Center Cost Savings
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| C1 | Call center costs | Interviews | $4,100,000 | $4,100,000 | $4,100,000 | |
| C2 | Reduction in call center costs | Interviews | 5% | 10% | 15% | |
| Ct | Call center cost savings | C1*C2 | $205,000 | $410,000 | $615,000 | |
| Risk adjustment | ↓10% | |||||
| Ctr | Call center cost savings (risk-adjusted) | $184,500 | $369,000 | $553,500 | ||
| Three-year total: $1,107,000 | Three-year present value: $888,539 | |||||
Technology Savings
Evidence and data. The interviewees’ organizations had multiple legacy technology tools and point solutions, with siloed and disconnected data. After investing in Salesforce, the interviewees’ organizations began to decommission their legacy solutions and tools, resulting in avoided licensing and maintenance costs. Interviewees noted cost savings in the following areas:
- Decommissioned legacy systems. The group transformation lead at a beverage organization noted that their organization was in the process of decommissioning several legacy CRM systems that were used across different regions of the business. They noted that the annual avoided licensing costs for just one of the systems was $0.5 million. Similarly, the vice president of enterprise sales effectiveness at a food company noted $3 million in licensing cost savings associated with its retired legacy CRM systems.
- Consolidated point solutions. The director of strategy and transformation at a food and beverage organization reported a $5 million reduction in technical debt as a result of retiring 10 mobile applications for front-line workers. The vice president of enterprise sales effectiveness at a food company shared that their organization retired roughly 400 point-solutions in the process of their organization’s technology modernization efforts, which included the implementation of Salesforce. These solutions included several homegrown tools, which were costly to internally update and maintain. By consolidating legacy solutions, the interviewees’ organizations also reduced vendor procurement and management costs.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
- It avoids licensing costs of $1 million in Year 1, $2 million in Year 2, and $3 million in Year 3 as the organization decommissions legacy systems and point solutions.
Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this benefit will vary depending on the following:
- The number of legacy systems and solutions that can be decommissioned with adopting Salesforce.
- Actual licensing costs associated with retired legacy technologies.
- An organization’s ability to effectively consolidate and decommission legacy technology, which depends on the company’s culture, risk appetite, and levels of change management to ensure adoption of the Salesforce platform and processes.
Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $4.3 million.
Technology Savings
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| D1 | Avoided licensing costs for legacy systems and solutions | Interviews | $1,000,000 | $2,000,000 | $3,000,000 | |
| Dt | Technology savings | D1 | $1,000,000 | $2,000,000 | $3,000,000 | |
| Risk adjustment | ↓10% | |||||
| Dtr | Technology savings (risk-adjusted) | $900,000 | $1,800,000 | $2,700,000 | ||
| Three-year total: $5,400,000 | Three-year present value: $4,334,335 | |||||
Unquantified Benefits
Interviewees mentioned the following additional benefits that their organizations experienced but were not able to quantify:
- Improved margins. By leveraging connected data and automation, Salesforce enabled the interviewees’ organizations to streamline operations, reduce manual processes, drive more data-driven promotions, and improve decision-making around resource optimization and contract terms. The director of strategy and transformation at a food and beverage organization shared: “In some cases, we were giving discounts where we shouldn’t have been based on the shelf-space we thought we had in stores. We were able to correct those issues through our new contracting process and use image recognition to verify the amount of space that we have.
- Partner enablement. The vice president of enterprise sales effectiveness at a food organization shared that their organization extended Consumer Goods Cloud access to its partners, improving data sharing and collaboration and enabling a unified CX across channels. They shared: “We do not go to market directly with our salespeople in all cases. We also have a partner on the Salesforce system, and we have a portal we created so that they can see and access the same things we have while keeping our systems secure.”
- Better CLM and compliance. The group transformation lead at a beverage organization noted that their organization utilized CLM functionality within Salesforce to drive efficiency, accuracy, and compliance: “We do several thousand contracts per year. Salesforce has transformed the way we generate contracts because the rep can input information into Salesforce, like the duration of the contract and payment details. Then the workflow compiles all of those delegations once the approvals have been gained and a PDF contract is generated. Once the customer signs, it is then automatically stored in a repository. That’s driven huge efficiencies because sales reps save a lot of admin time. It’s also got huge legal and compliance benefits because if we were to write a contract that was unfair or led to a misuse of market power, we could face literally tens of millions of dollars in fines. Our legal team feels very comfortable because all the right clauses are sitting in the clause library. It probably lets our legal director sleep better at night as well.”
Flexibility
The value of flexibility is unique to each customer. There are multiple scenarios in which a customer might implement Salesforce and later realize additional uses and business opportunities, including:
- Platform scalability. The Salesforce platform allows the interviewees’ organizations to scale up usage and users based on demand without significant upfront costs or reliability issues in comparison to on-premises environments. The director of strategy and transformation at a food and beverage organization said: “We used to run our front-office environment out of our own data center. We had stability concerns and sometimes stability issues. By moving this whole thing to Salesforce, it’s now in the cloud and we have this infinitely-scalable, highly-reliable, and always-available solution in the cloud.”
- Consumer goods specific capabilities. In addition to core Salesforce CRM functionalities, Consumer Goods Cloud enables the interviewees’ organizations to implement out-of-the-box and industry-specific capabilities, including prepackaged modules for account management, promotion planning, customer service, and retail execution. Consumer good organizations with existing Salesforce deployments or new implementations may realize faster time to market when implementing these capabilities.
- AI use cases. With the incorporation of predictive and generative AI (genAI), CRM is poised to expand its remit as a strategic business asset.3 Interviewees noted plans to adopt AI features on the Salesforce platform to unlock additional value. The group transformation lead at a beverage organization said: “We are looking into Einstein Next Best Action selling as a potential enhancement in the future. We’ve got a thousand products and service a broad array of customers. So, we want to use AI recommendations to help sales reps identify what they should be focusing on with each customer. That’s where I think we can unlock a lot of true value.”
Flexibility would also be quantified when evaluated as part of a specific project (described in more detail in Appendix A).
Quantified cost data as applied to the composite
Total Costs
| Ref. | Cost | Initial | Year 1 | Year 2 | Year 3 | Total | Present Value |
|---|---|---|---|---|---|---|---|
| Etr | Licensing costs | $0 | $935,550 | $1,050,225 | $1,164,900 | $3,150,675 | $2,593,661 |
| Ftr | Implementation and integration costs | $3,734,500 | $1,163,250 | $297,000 | $297,000 | $5,491,750 | $5,260,595 |
| Gtr | Training and ongoing management costs | $0 | $962,500 | $876,563 | $880,859 | $2,719,922 | $2,261,234 |
| Total costs (risk-adjusted) | $3,734,500 | $3,061,300 | $2,223,788 | $2,342,759 | $11,362,347 | $10,115,490 | |
Licensing
Evidence and data. Interviewees noted their organizations subscribed to a variety of Salesforce solutions, including Consumer Goods Cloud for Sales, Retail Execution, Service Cloud, and Trade Promotion Management. Licensing costs for each product varied and were determined based on multiple factors, including the number of users, product editions, usage volumes, and enterprise discounts.
Modeling and assumptions. Based on the interviews, Forrester assumes the following for the composite organization.
- It licenses multiple Salesforce products. The annual contract value is $850,500 in Year 1, $954,750 in Year 2, and $1,059,000 in Year 3.
Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this cost will vary depending on the following.
- The number and mix of Salesforce solutions licensed, factors that determine licensing costs (e.g., users, product editions, add-ons), negotiated discounts, and contract terms.
Results. To account for these risks, Forrester adjusted this cost upward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $2.6 million.
Licensing Costs
| Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|---|
| E1 | Licensing costs | Interviews | $850,500 | $954,750 | $1,059,000 | ||
| Et | Licensing costs | E1 | $850,500 | $954,750 | $1,059,000 | ||
| Risk adjustment | ↑10% | ||||||
| Etr | Licensing costs (risk-adjusted) | $0 | $935,550 | $1,050,225 | $1,164,900 | ||
| Three-year total: $3,150,675 | Three-year present value: $2,593,661 | ||||||
Implementation And Integration Costs
Evidence and data. The interviewees’ organizations incurred costs in the following areas:
- Internal implementation labor. Interviewees reported implementation timelines ranging from six to 12 months. Typically, their organizations implemented a minimum viable product (MVP) within a specific region or division that was then rolled out to other areas of the business after proving early successes. Several internal resources were dedicated to the implementation and roll out processes at varying levels of engagement — including DevOps engineers, programmers, Salesforce administrators, project managers, product owners, change and adoption managers, and business analysts.
- Systems integrator (SI) costs. The interviewees’ organizations engaged SIs to provide implementation support, with contracts totaling $5 million on average. The vice president of enterprise sales effectiveness at a food and beverage company shared that their organization utilized Salesforce Professional Services after the initial implementation to support ongoing platform enhancement, reporting engagement costs of $500,000.
- Integration costs. Interviewees reported that it was necessary to build integrations to connect Salesforce into their organizations’ existing tech stacks. The group transformation lead at a beverage organization reported using MuleSoft for the integration.
Modeling and assumptions. Based on the interviews, Forrester assumes the following for the composite organization.
- It implements an MVP in 10 months during the initial period, which is then rolled out to the entire organization over four months in Year 1.
- The MVP implementation in the initial period involves 20 internal resources, who each dedicate an average of 15% of their workload to the implementation effort. In Year 1, five internal resources are involved in the roll-out phase, similarly dedicating 15% of their workload to the effort.
- During the initial period, the organization incurs $3 million in SI costs. It incurs $1 million in SI costs in Year 1. The organization continues to enhance its Salesforce platform in Year 2 and Year 3, incurring $250,000 in SI support costs each year.
- It incurs annual integration costs of $20,000.
Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this cost will vary depending on the following:
- The implementation period.
- The internal resources involved in the implementation, how much time each resource dedicates, and fully-burdened salary of each resource.
- The level of SI involvement and engagement costs.
- An organization’s integration requirements.
Results. To account for these risks, Forrester adjusted this cost upward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $5.3 million.
Implementation And Integration Costs
| Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|---|
| F1 | Implementation period (months) | Composite | 10 | 4 | |||
| F2 | Internal resources involved in implementation | Interviews | 20 | 5 | |||
| F3 | Average percentage of workload dedicated per resource to implementation efforts | Interviews | 15% | 15% | |||
| F4 | Average annual fully-burdened cost of each internal resource | Interviews | $150,000 | $150,000 | |||
| F5 | SI costs | Interviews | $3,000,000 | $1,000,000 | $250,000 | $250,000 | |
| F6 | Integration costs | Interviews | $20,000 | $20,000 | $20,000 | $20,000 | |
| Ft | Implementation and integration costs | F1*F2*F3*F4/12+ F5+F6 | $3,395,000 | $1,057,500 | $270,000 | $270,000 | |
| Risk adjustment | ↑10% | ||||||
| Ftr | Implementation and integration costs (risk-adjusted) | $3,734,500 | $1,163,250 | $297,000 | $297,000 | ||
| Three-year total: $5,491,750 | Three-year present value: $5,260,595 | ||||||
Training And Ongoing Management Costs
Evidence and data. As part of their Salesforce investments, the interviewees’ organizations dedicated internal labor to training and ongoing management of the platform:
- Training efforts. Interviewees noted that users typically required 1 to 2 hours of training to gain familiarity with the Salesforce platform and the tasks associated with their roles. The director of strategy and transformation at a food and beverage organization noted that intuitive, user-friendly design during the implementation process minimized training needs. They said: “Most folks in frontline roles can learn their functionality within an hour or two and be fully functional. In fact, I would say for almost all the roles the amount of training involved is very minimal. That’s through the power of design. If you build a very intuitive application, you can kind of click through it and figure out what you need to do.”
- Ongoing administration and optimization. Interviewees reported that both business resources and technical resources were involved in ongoing platform management and optimization. Several Salesforce admins at the interviewees’ organizations were typically dedicated to day-to-day platform administration and management activities. After the initial implementations, the interviewees’ organizations continued to develop additional use cases for their Salesforce environments, requiring further involvement from internal resources.
Modeling and assumptions. Based on the interviews, Forrester assumes the following for the composite organization.
- In Year 1, 2,000 Salesforce users participate in 2 hours of training. In Year 2, 750 new users participate in training, and an additional 813 users join in Year 3, accounting for user growth and turnover.
- The average annual fully-burdened salary of a Salesforce user is $65,000.
- Five technical and business resources are dedicated to ongoing management and platform enhancements.
- The average annual fully-burdened salary of a technical or business resource dedicated to ongoing management and updates is $150,000.
Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this cost will vary depending on the following:
- Number of users who participate in training and the time required.
- Ongoing management requirements and the fully-burdened cost of resources involved.
- An organization’s efforts to release ongoing platform enhancements and develop additional use cases.
Results. To account for these risks, Forrester adjusted this cost upward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $2.3 million.
Training And Ongoing Management Costs
| Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|---|
| G1 | Salesforce users receiving training | Composite | 2,000 | 750 | 813 | ||
| G2 | Hours of training per user | Interviews | 2 | 2 | 2 | ||
| G3 | Average annual fully-burdened salary of a Salesforce user | Composite | $65,000 | $65,000 | $65,000 | ||
| G4 | Technical and business resources dedicated to ongoing management and updates | Interviews | 5 | 5 | 5 | ||
| G5 | Average annual fully-burdened salary of business and technical resources dedicated to ongoing management and updates | Interviews | $150,000 | $150,000 | $150,000 | ||
| Gt | Training and ongoing management costs | G1*G2*G3/2080+G4*G5 | $0 | $875,000 | $796,875 | $800,781 | |
| Risk adjustment | ↑10% | ||||||
| Gtr | Training and ongoing management costs (risk-adjusted) | $0 | $962,500 | $876,563 | $880,859 | ||
| Three-year total: $2,719,922 | Three-year present value: $2,261,234 | ||||||
Consolidated Three-Year Risk-Adjusted Metrics
Cash Flow Chart (Risk-Adjusted)
Total costs Total benefits Cumulative net benefits Initial Year 1 Year 2 Year 3-
The financial results calculated in the Benefits and Costs sections can be used to determine the ROI, NPV, and payback period for the composite organization’s investment. Forrester assumes a yearly discount rate of 10% for this analysis.
These risk-adjusted ROI, NPV, and payback period values are determined by applying risk-adjustment factors to the unadjusted results in each Benefit and Cost section.
Cash Flow Analysis (Risk-Adjusted Estimates)
| Initial | Year 1 | Year 2 | Year 3 | Total | Present Value | |
|---|---|---|---|---|---|---|
| Total costs | ($3,734,500) | ($3,061,300) | ($2,223,788) | ($2,342,759) | ($11,362,347) | ($10,115,490) |
| Total benefits | $0 | $10,542,938 | $12,523,388 | $14,522,063 | $37,588,388 | $30,845,037 |
| Net benefits | ($3,734,500) | $7,481,638 | $10,299,600 | $12,179,303 | $26,226,041 | $20,729,547 |
| ROI | 205% | |||||
| Payback period (months) | Less than 6 | |||||
Appendix A: Total Economic Impact
Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists vendors in communicating the value proposition of their products and services to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of IT initiatives to both senior management and other key business stakeholders.
Total Economic Impact Approach
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Benefits represent the value delivered to the business by the product. The TEI methodology places equal weight on the measure of benefits and the measure of costs, allowing for a full examination of the effect of the technology on the entire organization.
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Costs consider all expenses necessary to deliver the proposed value, or benefits, of the product. The cost category within TEI captures incremental costs over the existing environment for ongoing costs associated with the solution.
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Flexibility represents the strategic value that can be obtained for some future additional investment building on top of the initial investment already made. Having the ability to capture that benefit has a PV that can be estimated.
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Risks measure the uncertainty of benefit and cost estimates given: 1) the likelihood that estimates will meet original projections and 2) the likelihood that estimates will be tracked over time. TEI risk factors are based on “triangular distribution.”
The initial investment column contains costs incurred at “time 0” or at the beginning of Year 1 that are not discounted. All other cash flows are discounted using the discount rate at the end of the year. PV calculations are calculated for each total cost and benefit estimate. NPV calculations in the summary tables are the sum of the initial investment and the discounted cash flows in each year. Sums and present value calculations of the Total Benefits, Total Costs, and Cash Flow tables may not exactly add up, as some rounding may occur.
Appendix B: Endnotes
1 Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists vendors in communicating the value proposition of their products and services to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of IT initiatives to both senior management and other key business stakeholders.
2 Source: How To Adopt Industry CRM, Forrester Research, Inc., April 8, 2024.
3 Source: CRM Trends That Matter In 2024, Forrester Research, Inc., July 10, 2024.
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