Zoho CEO Says Salesforce, ServiceNow Are Extremely Bloated; Customers Overpay Them In India
During an exclusive interview with BW Businessworld on Monday, Zoho Corporation’s CEO Sridhar Vembu said he felt companies doing business with Salesforce and ServiceNow in India were overpaying and the services availed by them were not “worth it”.
Vembu said companies like Salesforce and ServiceNow were extremely bloated and come at very high pricing. “I consider companies like Salesforce extremely bloated and expensive in terms of their product offerings and their pricing. That is why we are going to compete aggressively for the business,” he said, on the competition during tough economic conditions.
During a press conference at Zoho’s Tenkasi office, the CEO revealed that the company had signed up its highest-ever number of customers in a month during March 2023.
“Actually, we are seeing rapid growth in India. Because we are the value player. Let me give you an example: If somebody is doing business with Salesforce in India or ServiceNow, they are massively overpaying,” Vembu told BW Businessworld.
He opined that Zoho could replace the services provided by Salesforce and ServiceNow easily and save a lot of costs for customers in India, US and Europe. Vembu pointed that the customer wins in March are indicative of the switch from Salesforce and ServiceNow happening already.
The Zoho CEO accepted that he could not have predicted highest-ever customer wins in March. But he said that the company had observed this divergence six to nine months ago when the number of customers signing on for Zoho was growing but the size of revenue had dropped, causing a decline in profits. Vembu chose to see this as a positive because he felt customers picked his company despite the economic conditions.
“I would’ve hoped for this but I certainly didn’t predict this. Now, they (customers) will begin to trust the Zoho model and expand their business with us,” said Sridhar Vembu.
Vembu said that his company offers a good choice in terms of both superior products and value. “That is why we think that even in an environment of tough IT spending, we are doing better,” he added.
The Zoho chief said that Zoho Suite alone had six lakh customers in 2023 and the number would reach one million in the time horizon of one-and-half years.
'India, The Hottest Market'
Currently, India is Zoho’s third largest market in terms of revenue with the US and Europe being #1 and #2 markets. But Vembu said that India is poised to replace Europe as the company’s second largest market in lesser than three years as there is tremendous prospects in the country.
The Zoho CEO said that the growth in developed markets including the US and Europe has been observed to be sluggish, as opposed to emerging markets such the Middle East, Latin America and Africa. Meanwhile, Vembu observed that the Japan market has been in “doldrums”.
Vembu said that India could be Zoho’s top market in as little as seven to ten years in terms of revenue.
“That's a major transformation for the company because approximately 10-12 years ago, maybe 2 per cent of the revenue must have been from India. So, to go from that to majority of revenue coming from India in about a 15–20-year period is remarkable,” Vembu emphasised.
Within India, Vembu thinks that the greatest source of development will be led by smaller cities and towns. In the recent times, the Zoho chief has increasingly shown interest in implementing Zoho’s Tamil Nadu hub-and-spoke model for Eastern UP and surrounding areas as he sees enormous potential for growth in the region.
Also Read: Willing To Accept Profit Cuts, Loss For Certain Period: Sridhar Vembu On Persisting With No Layoffs
