"Salesforce.com has done extremely well," Kingstone said. "They have spent a lot of money marketing and educating potential customers to the benefits of hosted application services."
Now that the market understands the advantages of hosted applications, resistance to the idea is mainly cultural, rather than technical, she said.
Many of Salesforce.com's first customers were in companies that had already tried to implement in-house systems and failed, she noted. "The company has done extremely well with people who have already felt the pain of implementing CRM solutions."
However, the company has not picked all of the low-hanging fruit in the hosted applications field, Kingstone said. "There are still a lot of good apples to be picked," she said.
As the company expands its line of software, it will run into new competitors in the accounting and ERP field. The market for this type of software for medium-sized companies is fragmented, she noted. Big vendors such as Microsoft also are looking to make headway with medium-sized companies.
One area that Salesforce.com could improve upon is offline reporting, she said. Users often need to edit reports while disconnected from a network and would like more sophisticated features that allow them to do that in Salesforce.com's software, she said.
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