Salesforce, Inc. (CRM) Earnings Call Transcript & Summary

Hello, everybody. I want to welcome you to the Salesforce.com management meeting with the focus of the topic on the Commerce Cloud. I'm thrilled to have with us the practice manager here of the Commerce Cloud, Lidiane. And so Lidiane, thank you very much for making your time, sharing insights here on the Commerce Cloud. For investors out there, if you do have questions, feel free to send it to me on the chat. You can e-mail it to me. We can even open it up if you want to spot it out, but feel free to use the chat function to me. I'm happy to ask Lidiane your questions about the Commerce Cloud.

So let's start. And just starting from the top, Lidiane, maybe the buy-side investors aren't as familiar with you as maybe some other people at the company. So why don't we start out with the introduction? I know with your background, you've worked at some of the most famous technology companies in the world, Apple, Microsoft out there. You got a computer science degree. So I wanted to start off the conversation with your thoughts about the company, just your personal thoughts. I just wonder if there's any strength that you may have underappreciated about the commerce business and the commerce cloud technology until you really got under the covers and joined the company. So how has the experience been so far? Any surprises, general thoughts on the Commerce Cloud and Salesforce from your lens?

Thank you, Brian. Thank you for having me. It's really great to be here. Well, it's been an amazing journey being here at Salesforce. I think one of the really amazingly positive surprises is just how quickly this company moves, especially at the size that we're in. It's just really impressive how we can pivot to be relevant to customers. And we -- in my short, close to 2 years here, we pivoted to do things like Work.com. And with commerce particularly, we pivoted to delivering these ready-made solutions for commerce customers to very quickly launch called Quick Start. And we went then to work on a vaccine cloud. Like it's just been really impressive to see how the company moves so, so fast. And from a technology perspective, one of the things that I get extremely excited about with Salesforce, and it's been a positive even more so than I expected, is the incredible portfolio of technologies that we have here. And so if you think of the leading analytics solutions, Tableau, the leading commerce platform with what I'm leading now and much more. So from a kind of innovation perspective, I think of it as the possibilities are just so endless. So just being able to unlock a lot of cross cloud innovation, even in my short tenure here because we have such an incredible portfolio of products. So it's been a great -- the speed and the kind of the innovation portfolio has been 2 really incredible upsides from my point of view.

Terrific. How about one other look back? I just wanted to ask you just about lessons that you experienced looking back at COVID. Certainly, the last 12 months, it was nothing like anything else in our lives. What were some of the lessons you learned, specifically with Commerce Cloud? Maybe from a bigger standpoint in terms of the e-commerce market that you can share with us about overseeing a business segment and a large company like Salesforce.

Yes. I think one thing, Brian, it's such a great question. I feel like we're still all learning about this transformation that we're still going through. Some of the things that I learned this year is how we -- our customers were in this very lengthy process of thinking what digital transformation was going to be like. And that really got turned upside down. They didn't have years to figure out how to take their business digital. They had weeks, months. So that really forced our customer base to really think about how to be more incremental about their transformation and start getting value to customers very quickly, and then they can expand over time. So just kind of shifted the picture. And certainly, for us in the commerce space, it's been the same, right? Like how do we then help our customers in an incremental way as well? So if you look at our headless platform, which is really a platform that gives customers flexibility to build their front-end experience, we've incrementally added value because it's how our customers are consuming technology now. It's more right size because it's more specific to the set of use cases that they want instead of a giant multiyear. So companies will still be transforming for a long time, but they're just really trying to stay at the forefront of what their shoppers, their consumers really want. So it's been a really interesting complete flip. And if you had talked to me prepandemic, I'd say, well, regular headless implementation is a 2- to 3-year stage. Now customers are like, well, I'm going to do headless for this channel. I don't need it to do for everything because I just need to unlock a mobile app. So it's just been very, very interesting the way that our customers, the way that we are looking at how to grow our business. It's been just a fascinating and very humbling experience, if nothing else.

Terrific. Thanks a lot for those look-backs from your personal perspective. How about looking forward here? The company as well as the Commerce Cloud is coming off a great quarter and a start to the new fiscal year. What are some of the new initiatives or technology investments for the Commerce Cloud that you're most excited about here over the next 12 months?

Brian, how much time do you have? I could talk to you forever about -- and I genuinely love talking about commerce, so you temper me a little bit. But what I truly believe in, I think the biggest learning from a digital transformation that we've seen in every industry, whether it's retail, groceries, automotive, insurance, you name it, customers that have been the most successful are the ones that are creating experiences that are relevant to their user. And it's been interesting that all of our consumers, right, you and I, I'm sure, Brian, when you go to an e-commerce experience, if you've served a product that's not relevant to you, you get turned away. You go do something else. You go find a different brand. And so customers that really deliver customer-centric commerce experiences are seeing significantly better results. So that's been the foundation of like what are we going to do moving forward and what we just actually announced the Connections last week. So starting at the foundation of building a customer-centric data platform in connecting commerce data to that, that unlocks like full journey of marketing commerce service to just work out of the box. So we always know who Brian is. And that personalized experience at scale that doesn't cause our customers a whole lot. And then we've continued to focus. Another focus for me is how do we help our commerce customers with the entire commerce journey from B2C commerce, B2B commerce, order management payments, increasing the portfolio of solutions for commerce? So you might ask, why does that matter? Well, customers are going through that full journey themselves. So every time they have to go build a different product or buy a different vendor, it's complexity in time that they don't have or don't want to put energy into. So building a set of connected portfolio of products gives us the ability to serve the entire spectrum of needs for our customers. And it also allows them to start wherever they want. So if they want to start with the B2B product and then expand to direct-to-consumer, well, we have a solution for that. If you want to expand and leverage our payments, we have a solution for that. So that just gives our customers the ability to expand their footprint over time with more flexibility. So some of the big announcements that I'm thrilled to share is that we are launching a brand-new product called B2B2C product commerce. And that was really borne out of our commerce B2B customer needs. As you remember, customers that had just a B2B commerce experience, many of them were shut off from a direct-to-consumer because the inventory system kind of fell apart on the pin down. And if you think about the world, we couldn't find toilet papers, right? Like that's the reality that we are living in. And companies now want to have the flexibility to reach direct-to-consumer so that they can serve their customer needs if they have channel challenges. So this product really will help customers to extend what they have and, within days, be able to get a site up and running and start testing it, learning from their consumers. So we're very excited about all that. And then we're innovating within each one of our portfolios. So our B2C product, which is our largest product and certainly the flagship of our Commerce Cloud, we're adding a headless set of capabilities for customers to, again, go to market fast. So we're launching PWA kits and manage run time. That really means like getting new little applications up, running and fast very, very rapidly. And then we're extending on order management in a number of ways, distributed inventory and distributed order management, because the world is moving to this blended digital physical space. We want customers to always know what kind of inventory they have, whether it's warehouses or stores, giving customers more flexibility as they reopen. And then bringing that order management capability to our B2B customers. So completing our full portfolio, again, with the foundation of our customer data platform. I know it's a mouthful, Brian. So hopefully, that was easy enough to follow.

It was actually a lot. You gave us a lot of what's happening with next-generation commerce, in general. You kind of touched upon a lot of those trends and with Salesforce monetizing. That was terrific. Why don't I ask one more question here? And then happy to open it up to the buy side, to our listeners out here. Kind of maybe touching upon your discussion on what's happening in the e-commerce market. I guess this is more near term, and it's just on customer priorities. So if we think about last year, COVID-19 clearly has accelerated everything e-commerce. But it certainly accelerated having a transactional engine, especially if you were an on-premise story, you didn't have a way to sell. So you had to do that. But now that we're kind of lapping these investments and we're further along on the pandemic, when you think about our customers in these conversations, when they think about prioritizing their next-generation commerce solutions here post COVID, is there a difference in the prioritization in the spend for the applications, the ones you talked about, the order management, all of those versus having a core commerce transactional engine?

That's such a great question, Brian. What we're seeing is definitely getting their foundational store up and running is the top of mind for customers. But it varies again based on the maturity of which -- where each customer is. So for some customers, they need to replatform because they're not monetizing the market as other vendors are. So that we're seeing a lot of customers coming to us because they're replatforming. They need better conversion rates. They need to grow their business. And then what we're seeing with other customers, like you mentioned order management, those that have -- they were already our customers. They have a good foundation. They're just expanding to become more digital across the entire spectrum. So the reason why I'm excited and we've expanded on order management is that this year, the challenge for customers are actually going to be about blending. For customers that have physical spaces, they have -- a lot of them have all of these retail stores that they own or they rented and they're committed to. So they're trying to optimize their spend and still deliver a great customer experience. So what we can help them do now is optimize location for inventory so that their shipping costs are lower, their time to -- delivery of customers is as much faster and they're delivering great customer experience in the process. So again, it varies per customer, but we're seeing a huge urgency in both getting the primary digital storefront up and running and getting that conversion rate high. And we're delivering a lot of AI to help with that. And then reopening is a big theme for customers right now.

Terrific. Really appreciate that. It's right on the money. Lidiane, you got your first question. It's from James. Charles, can you open the mic for James?

Yes. James, if you're ready, we can unmute you.

Go for it, James.

James, your line is open.

All right. We'll -- while we figure that out, the technical, Lidiane, why don't we go on to -- I have another question that came through to the buy side here. They just wanted to understand -- it's just brought from the top level. They want to understand the growth sector -- the growth story, I'm sorry, for the Commerce Cloud. So I'll just read it. Can you provide the contours and how we should think about the growth opportunity for Salesforce in e-commerce within these larger customer market teams?

That's such a great question as well. There's just a lot of growth in commerce in general. So it's a great time to be in the commerce space. We saw a lot of growth. And our customers that are already in the platform are also growing on their GMV. So they're selling more. So we had in the last quarter 48% year-over-year growth. So it's massive, especially our scale. So we get a chance to both monetize when our customers win, and we monetize when we award new customers. So the way that we are expanding our monetization opportunity for commerce is twofold: One, we want to make sure that our customers have the flexibility to really implement when they want a hyper customized experience. And that's really great for very large customers because they want every micro experience to be as optimal as possible. Why do they care? Because if like a car's performance or a particular display of a product can change the conversion rate by 1% -- and that translates into millions of dollars in revenue. So that hyper personalization is really important if you're very large. But we also see a lot of opportunity for growth in the lower end of the market. So both delivering these predefined, prebuilt websites with our templates and offering click-based experience for B2B and B2B2C gives us a huge spectrum of the overall market that we can cover. And then another segment that I just want everybody to keep in mind is that -- and it's been a great Salesforce differentiation is that we are expanding rapidly on industries. And the acquisition of Vlocity, we partnered really closely with Vlocity, has helped us be best-in-class for a lot of different industries, including, I mentioned briefly earlier, automotive, insurance and much more. Just last week alone, a VW branch in Brazil launched a brand-new car. And they sold in 7 minutes the entire inventory, which blew us away digitally in leveraging Salesforce Commerce Cloud. So our expansion in industry is also another incredible growth lever for us, which we're very, very excited about.

Thank you. I got the question that came through James through chat. So basically, it's a good question. Just wondering if you could talk about Salesforce's opportunity to play a role with -- either with or against the consumer Internet companies as they start moving down the funnel into e-commerce. The Twitter, Facebook, Instagram, Pinterest, they're all adding e-commerce capabilities this year. So how does Salesforce think about the opportunity of either partnering with them or competing against them?

It's a great question as well. So the social channels -- and there's always many. The one that you -- the ones that you described are very prominent here, but there's even others in other parts of the world that are very relevant. And they are very important channels for our customers. So we have to take a dual approach to the partnership with social vendors. One is being able to integrate with them so that our customers can expose their brands. It's a growth engine to bringing in more customers. However, customers also want the ability to own the customer. And that's the challenge that we have to balance with. So a lot of the capabilities that our customers wants us to build is helping funnel customers into their own sites because if the customer only transacts in a social channel, if you're one of our brands like Gap or Sonos or Herman Miller, you lose who that customer is, you'll never be able to see their profile. And you can't create a loyalty funnel after that. So our approach to it is create those integrations to try to optimize the experience to bring customers to our platform. And we're learning a lot this year with our customer data platform. We're ingesting a lot of data for our customers. And that's going to define how deep we go with social partners over time. But we do see a very important set of partnerships. We're having more aggressive -- more proactive, I should say, conversations with all of these relevant social vendors because they are a very important channel for our customers.

Terrific. Lidiane, a question came in here. It's really about the pricing model. And then there's kind of a follow-up question on where the customers are. So maybe it's a good time to maybe just talk about the pricing model for the Commerce Cloud. And then the question is, is there a way of thinking about the mix between the subscription solutions and then the success rate, the shared success-based solutions and the rate of growth? And then the follow-up question was just thinking about where customer cloud customers are in terms of hitting their thresholds. Clearly, revenue stepped up a lot, which was reflected in the higher GMV. We all saw the data here. So that's the second part of the question. Just wondering about thinking about what percentage or rank or however you want to talk about it, where the customer base is in terms of hitting higher thresholds for what happened last year.

Yes. No, that's great. So let's start with the monetization model. And as I talked about that spectrum of products, that portfolio of products, we are trying to create a set of options for customers. So GMV-based is a percent rate of your total gross merchandising value. So if you sell $10 million, we take a percentage of that as part of the revenue. That's the predominant way that our B2C product is sold today. The reason why customers are happy with that is because a lot of our capabilities, our focus is on shared success. So we've delivered a ton of AI innovation because we know it increases average order highs, et cetera. So that's been a very successful model for Commerce Cloud. But we also have -- with B2B commerce and order management, we had orders-based. So if you want to pay per order, that's the way that is more common for that particular customer base. So we're really trying to create a set of options for customers to make sure that it works for their business model. In terms of the GMV growth rate, it's been fascinating. I think last year, we -- there was the Q1, which was a pandemic like shutdown and a giant surge at the tail end of that across the world, right? We all saw it. Everybody started shopping for groceries online. Everything just blew up. So we saw a massive amount of like early renewals that we weren't accounting for last year, prepandemic estimates. So we saw an incredible surge. We're continuing to see this surge. Now so when we hear -- I'm sure you guys have heard this before, it's holiday every day. It still is holiday every day. So that means that everybody is recalibrating what that growth rate looks like. So what we have done actually for our customers is that we can actually estimate now when we think they're going to run out. And so we're starting to have those conversations with our customers because we know that many of them are going to have to renew early. And so we start that much earlier to help them plan, et cetera. But it is -- as I was mentioning, Brian, our GMV for Q1 was a 48% year-over-year growth. It was less than half of that the year before. So just a massive -- continue to be a massive growth all of our customers. And it varies per industry. I think the interesting part of last year is that in the first half of the year, our grocery customers were like 1,000% growth. It's just hundreds or -- like depending on the chain. And Europe shut down first. So the European grocers like hit, exploded first. So we've seen these interesting industry and regional dynamics. But it is -- I'm expecting that this year is still going to be a year of a lot of growth for our customers. What we think about from the business though is how do we continue to grow at a healthy rate of both GMV success but also new logos. And so we mix -- our focus is to mix both success of existing customers and make sure that we are attractive to new customers as well.

Terrific. I got a question just on the competitive differentiation. So clearly, this is an established market. Retail has been around for a long time here. So can you talk about the differentiation for Salesforce's technology versus -- if I gave you 2 buckets here? In one bucket, you've got these large legacy ERP vendors, SAP, IBM, WebSphere tools, Oracle, ATG. And then in the second bucket, you have these best-of-breed vendors. You've got the Shopifys of the world, Adobe with Magento, BigCommerce, et cetera. So why is the Commerce Cloud technology better than those other suppliers that have also scaled and done a pretty good job selling their own products?

It's a great question. I think what sets us apart is giving customers options. And what we have found, certainly I have met a lot of great companies this past year, is that no one size fits all solution is great for customers. You can't really box a customer into clicks-based experience or headless experience is the right solution for you. Customers actually, as they grow their business, needs to have quite a bit of options in how they're going to deploy. So take some large customers, for example. Many of our customers, they may choose to be in that hyper personalization that I was describing for their largest market. So if their largest market is here in the U.S., they will do that here because they have -- there's a higher revenue stream coming in. So they're willing to invest a little bit more to create that customization. But if they're looking to enter a smaller market or they're trying to launch a new brand that is still early and they don't have a giant revenue, they want to be able to create a template or launch a template but still have a centralized view of their user and their business that is multisite, multi-regional. So we really offer that global scale but also offer that spectrum of options in implementation that doesn't fragment the business for customers. That's been a big differentiation for us and why customers have chosen us is that we can really do that with a lot of flexibility and ease. It's been certainly a big formula for success for us this year.

And maybe just a follow-up because we kind of just talked about Shopify. And -- well, the question is the ability of the Commerce Cloud over time to monetize on more of the GMV that's coming through. And Shopify is the best example. They've done a great job monetizing more and more of the GMV, whether it's a storefront or doing payments, fulfillment. Are there any limitations for the Commerce Cloud to be able to replicate that type of Shopify flywheel over time?

[Technical Difficulty] Brian, I'm so sorry about that. My power just went out, but...

I thought I froze.

But I have a WiFi here. So hopefully, not too disruptive.

No, You're fine. Let me just ask you on the ability of the Commerce Cloud over time to monetize on more and more of the transaction, the GMV that flows through the system. So we were talking about Shopify. They've done a great job creating this flywheel of monetizing GMV. They do it with the storefront and the payments and fulfill, et cetera. So the question is on the Commerce Cloud. Are there any limitations that would be preventing the Commerce Cloud from over time being able to create that type of Shopify flywheel effect and monetize it more and more in the GMV?

No. No, that's been the journey that we've been on, Brian. So I'm glad you asked me that question because with the expansion of our portfolio, we are now serving more needs for our customers than we were able to before. So with order management and now payments, we launched payments out of the fall of last year. It gives us the ability to offer all-in-one for customers. And so in many cases, customers are doing the GMV model with an orders base for order management and then leveraging our payments, which is a transaction-based monetization, to deliver their business. So that gives us -- not only is it better for our customers, it's easier to go to market. But it creates a lot of different vehicles for monetization for Commerce Cloud that just didn't exist before. And so order management was launched in February of last year. B2B commerce was launched in the summer of last year. Payments was launched in the fall. So this last year, we've really completed the portfolio. And that's really setting up a much more diverse portfolio business for us. And we're seeing an incredibly positive response from our customers. We've hit over 100 customers that have already bought our order management product in just 12 months. So that's a very impressive first year for organically developed product here at Salesforce.

No, that's terrific. There was a buy-side question that came in on the applications. You talked about them a lot actually through this call, especially with order management. But they were hoping -- if you could shed any light on which of the applications are experiencing the highest attach rates or the greatest demand? Separately, which ones have the longest -- or the biggest monetization opportunity and just overall customer interest levels?

Yes. It's been an incredible year for B2C commerce. We are seeing just an incredible amount of interest from customers. And again, we've had varied implementation. Some customers are going all in on a headless approach, and then the expansions are quick paced. But for us, it's a single SKU so customers can choose how to implement after that. So we've seen a surge in that. And the incredible thing about commerce is that it is -- once the platform is in, it's really hard for customers -- I mean they don't want to leave unless something is wrong. But if the business is going well, if you win a customer over, you really have an opportunity to keep that customer in a long -- for the long haul. So I'm really excited to see that not only interest but the sales and the adoption and the rollout of B2C e-commerce. So that's been really interesting. Payments is our newest product. And so it's just starting to get traction. I'm really excited about that blend of B2C commerce and payments and what that's going to do to our business because it's a new monetization model for Salesforce. And it's just an incredible opportunity for us to really support customers and grow the business at the same time.

I'd love to add Salesforce to the payment story. It's a big theme out there to that. Lidiane, where are the budgets coming from or the spend coming from? So the new spend ideally. So if I gave you these 3 places, if you could stack -- clearly, they're coming from all 3. But if you could stack rank where most of the spend is coming from between these 3. The first, where just rationalizing the legacy commerce footprint, so rationalizing old technology. Number two, just white spaces, so new ROI that the Commerce Cloud is generating for your customers. And then number three, from service organizations or consultants who are coming in and trying to put together a company's commerce strategy. How would you stack rank those 3 when you win new spending in the market where it's coming from?

Yes. No, it's also a great question. So the second one that you mentioned, new stream of revenue has been a very big theme for our customers this year. There is a lot of customers replatforming as well. So it's a close second, I would say, the platforming. But the new channels, the thing that we were experiencing prepandemic in the market was that a lot of customers were concerned about disrupting channels. So take, for example, Sonos, who's one of our customers. They had started direct-to-consumer with Salesforce Commerce Cloud. They very slow and intentionally slow mostly because they wanted to make sure that their channel partners were feeling comfortable about what that blend looked like. When the pandemic hit and every channel was shut down, direct-to-consumer became their primary channel, and it grew 400%. Now it's -- it used to be a couple of percent points of their total revenue. Now it's over 20-some percent. So it's a very tangible amount of growth. So we've seen cases like the Sonos one over and over and over. That pandemic disruption of channel just created a permission that customers didn't feel comfortable with before. So there's been a massive explosion of new channel revenue for commerce. And then kind of a second, close follower is these customers that maybe had an in-house implementation that really struggled to survive during the loads of the pandemic. So they had outage issues or problems like that or competitors -- competitive products that also struggled with that surge and came to Commerce Cloud. So there's been -- both of those have been primary reasons why customers have come to us. And where they are also finding there, to your point, their budget to spend is because it is a tangible part of growth for their business if they do a good job at it.

Terrific. I got a question that came in, in here. I'll just read it. It's about Black Friday, Cyber Monday importance. You said that it's a holiday almost every day over there in your business. I wish I was working for you. But the question they want to know is Black Friday and Cyber Monday, is that still a big deal and an overwhelming contributor to your division's bookings? Or has other promotions -- they used the example like an Amazon Prime Day and all the competitors who do it. Were other dynamics in the market impacted on how we should think about the importance of that fiscal 4Q back to the overall fiscal year?

The interesting thing, Brian, is that a year ago, if you asked me that question, I would tell you, I don't know how holiday is going to be because it was such a surge. And even my own customers were unsure of how much inventory to plan for the holiday season because they were selling out during the summertime what they thought they would be selling through the whole fiscal year. So the reality is that we still saw the same curve from the holiday from 2020 to holiday 2019. It was much higher curve, meaning that the holiday numbers were already surpassed from the year before. But we just a saw giant peak during the holiday season, again, despite being so elevated. It surprised all of our customers. Seasonality does vary per industry. So some industries are -- their seasonalities are in different times. But for the majority of customers, that Black Friday, Cyber Week is such a big part of their business. And it used to be an American phenomenon. Now it's a global phenomenon. So it's kind of hitting every region of the world, European, LatAm and so forth. So we did see that giant spike last year. We're expecting to see that again. So what's happening is that the digital channel has just become a prominent channel. We've just seen business shifted. The other thing you didn't ask me is but I will tell you is that as stores opened, we've been monitoring is that going to decline digital sales, and it hasn't. It just -- consumers have just changed their habits. They want to use physical spaces for different things now. They want to just pick it up in store because it's convenient for them. But they certainly are shopping online more and more. We did a survey here at Salesforce Research to find out from consumers how they -- are they going to spend the same next year or this year as they did last year? And 75% of respondents said they're going to keep their spend or spend more because as the economy is picking up, people now have learned and have gotten used to shopping online. And now, they're ready to kind of put their back -- their lives back together. So we're expecting this year to continue to be a very strong year similar to last year and then to also expect that Cyber Week to be just as much of a peak as we have seen last year. So it's a pretty exciting time. Certainly, it means, Brian, that we prepare for that holiday season all year because it can always spike 5x, 7x. Like the numbers have -- last year was kind of mind boggling.

Terrific. We're almost running out of time. So if anyone want to get their last questions in. What I wanted to just ask you as a general manager, as a business manager, and I'm just curious if there's any back-to-work efficiency benefits to the operations within your group. So if I think about the last 12 months, your division, you deployed many customers. And clearly, these were all virtual implementations, even including some very large brands. So I'm just wondering, as your team starts coming back into the office, are there any concern whether it's customer acquisition, development or deployment processes, they could see improvement or benefits from employees returning back to work?

Well, we can certainly learn how to be efficient from anywhere. And so the amount of like business that you were -- and as you mentioned, Brian, that we're able to do has been phenomenal. So that -- we certainly want to preserve that. As people go back into the office, what we're really excited about is how to use our time together to be more strategic about our investments. So you talked about how do we monetize more of our GMV, how do we help some of these newer products in our portfolio take a stronger footprint in the market. That's where we're going to be our focus, and that's what we're expecting our customers to do with our own products. So if you look at our B2B commerce, customers are buying large, large quantities of product. We don't want them to replace their relationship with their sellers. But we want their buyer and seller relationship to be more strategic. So we're expecting this shift to work, not for us to lose any of the systems. We wanted to accelerate both the innovation and growth of our business is how I certainly look forward to spending time together with my team.

Thank you. We did have a buy-side question came in. It's a little bit around this topic. So I'll just read it. It says that Marc Benioff talks about new operating models to be more efficient. Where are the efficiencies in your business, your division?

Certainly, what we are looking at is there's 2 different pieces of efficiency. One is we are -- as you know, as a company, we're really making a big shift to Hyperforce. So -- and that's moving to a public cloud infrastructure. And that is going to really help us operationally be much more efficient, not only from a cost perspective but also from a growth to new regions because data residency, all of those service redundancies already exist in public infrastructure. That tends to be a costly part of our business. So we're really going to gain a ton of operational efficiency out of that, that I'm very excited about. The second thing is also just taking -- I think we have an opportunity to take advantage of our ecosystem more efficiently than we have. Success for commerce isn't just commerce alone. It's -- I think someone asked about social channels, but also the ecosystem around commerce really powers growth. So I'm very excited about just accelerating the business through the ecosystem as well. And that -- operationally, that is not extremely costly for us. So it's just about really onboarding the ecosystem more efficiently. So that's going to be another big focus for commerce this year that I'm excited about. I think both of those are very in line with what Marc has been talking about.

Terrific. And we ran out of time. Lidiane, you did a great job. Thank you very much for taking the time shedding some light on the Commerce Cloud as well as the e-commerce market, what's going on in the e-commerce market in general.

Thank you so much, Brian. Apologies for the technical difficulty.

No problem. No problem at all. Take care. Thank you very much. Bye.

Thank you. Bye-bye.