Good morning. My name is Nicole. I will be your conference operator today. At this time, I would like to welcome everyone to the Salesforce.com Buddy Media acquisition conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. To withdraw your question, press the pound key. Thank you. Mr. Havlek, you may begin your conference.
Thanks, Nicole. Good morning, everyone. Earlier today, Salesforce.com announced its acquisition of Buddy Media, Inc.. The details of that transaction can be found in a press release issued at approximately 3:00 A.M. Eastern Standard Time this morning. Joining me today to briefly discuss the transaction are Marc Benioff, Chairman and CEO, and Graham Smith, our CFO. Before we begin, let me remind you that the purpose of today's call is to discuss the Buddy Media acquisition and not our company business performance. In that context, Graham will review the terms of the transaction, including its estimated impact on our fiscal 2013 guidance, as discussed on our results call last month. As is our standard practice, we will not be providing any preview or update on the company's performance for our fiscal second quarter.
It's my duty today to remind you that our discussion will contain forward-looking statements about the acquisition, its timing, its specific impact on our financial forecast, and its general impact on our ongoing business going forward. Among other things, these statements are subject to risks, uncertainties, and assumptions. Should any of these risks or uncertainties materialize, or should our assumptions prove to be incorrect, actual company results could differ materially from these forward-looking statements. All these risks, uncertainties, and assumptions, as well as the information on potential risk factors that could affect our financial results, are included in our reports filed with the SEC, including our most recent reports on Form 10-K and Form 10-Q, particularly under the heading Risk Factors.
Please be advised that any unreleased services or features referenced in today's discussion or other public statements are not yet available and may not be delivered on time or at all. Customers who purchase our services should make these decisions based on features that are currently available. Following our remarks today from Marc and Graham, we'll take a few questions on the phone. Let me turn the call over to Marc now. We'll get right to it. Marc?
All right. Hey, thanks so much, David. Hey, I'm really excited to announce that we've entered into an agreement to acquire Buddy Media. It's the world's leading social media marketing platform and our largest acquisition to date at Salesforce.com, and we're expecting the deal to close during our third fiscal quarter. Buddy Media, as you know, has pioneered the social media marketing industry and shown companies how to create and measure marketing programs across Facebook and Google, LinkedIn, Twitter, YouTube, and more. Their award-winning technology allows customers to publish content, place and optimize social ads, and measure the effectiveness of social marketing programs, empowering companies to determine which content and campaigns are delivering the greatest return on their investments. With eight of the 10 top advertisers in the world as clients, Buddy Media is the clear leader in social media marketing.
The company has nearly 1,000 customers, including major global brands like Ford, Hewlett-Packard, L'Oreal, Mattel, and world's largest marketing agency groups such as IPG, Omnicom, Publicis, and WPP. You can see a great presentation on Buddy Media that I recently put on my Twitter page at twitter.com/benioff. With the social revolution, the marketing industry is undergoing the biggest transformation it's seen in 60 years. Facebook has become the new corporate homepage, according to Gartner, CMOs will surpass CIOs in spending on technology within the next five years. That is why today we're doubling down on the Salesforce Marketing Cloud. We absolutely believe Buddy Media, coupled with our incredible acquisition last year of Radian6, will help us capture more of this fast-growing market and accelerate our growth. We've traveled around the world on our tours. We've seen tremendous response to our social enterprise messages.
I know that many of you have joined us at these critical events in London and New York and Washington, D.C., and others. One of the key areas our customers are most excited about is social marketing. They're asking us for new ways to manage all of their social marketing efforts and tightly integrate them with the rest of their customer information. They want integrated CRM, sales, service, and marketing. Gartner says that CRM is 58% of the purchase intention of global CIOs this year. That's the number 1 global purchasing intention. CRM, according to Gartner, is sales, service, and clearly marketing. Now, by combining Buddy Media, the world's leading social media marketing platform, with Radian6, the world's leading social media listening platform, the Salesforce Marketing Cloud will be the clear choice for brands to listen, engage, gain insight, publish, advertise, and measure their social marketing programs.
It cements Salesforce.com's position as the number 1 in sales in the cloud, number 1 in service in the cloud, and number 1 in marketing in the cloud. For the first time, CMOs will be able to manage the entire social media marketing lifestyle on 1 unified platform of customer information. With this acquisition, Salesforce is perfectly positioned to capitalize on another high-growth, multibillion-dollar opportunity. Now, over to Graham for the financial details.
Thank you, Marc. Good morning, everyone. With the acquisition of Buddy Media, Salesforce.com will own the two preeminent assets in social marketing, the world's number one social media listening and engagement platform, and the world's number one social media marketing and advertising platform. We believe that over time, the Marketing Cloud can become our fourth billion-dollar business, alongside the Sales Cloud, Service Cloud, and Platform. Before I get to the financial details, let me tell you a bit about Buddy Media. The company was started by Michael and Kass Lazerow
In 2007. They have approximately 300 employees. They are headquartered in New York with offices in San Francisco, London, and Singapore. They are the only social media marketing vendor to provide social ad placement and optimization, giving them a distinct competitive advantage. Turning to the transaction details. As stated in our press release today, we entered into an agreement to acquire Buddy Media for approximately $689 million, consisting of approximately $467 million in cash, $184 million in Salesforce.com common stock, and $38 million invested Salesforce.com options and RSUs. Using Friday's stock price, we estimate that the $184 million consideration in stock will consist of approximately 1.4 million shares. The exact number will be dependent on the final 20-day pre-closing weighted average share price. All of Buddy Media's options, restricted stock, and RSUs held by continuing employees will be assumed and converted into options, restricted stock, and RSUs of Salesforce.com.
The senior leadership team will also receive retention equity awards that will vest over three years. As many of you know, we have a great track record of successfully retaining and elevating exceptional leaders from prior acquisitions, including executives like Greg Swendsen, Alexandre Dayon, Byron Sebastian, and of course, Marcel LeBrun. We look forward to Michael, Kass and the Buddy Media team joining Salesforce and helping to drive our Marketing Cloud for many years to come. The transaction is expected to close sometime in our fiscal third quarter, subject to customary closing conditions. Let me review the financial impact of the transaction. Given the expected third quarter close date, the transaction will have no material impact on our fiscal second quarter revenue or EPS.
As we look to the second half of fiscal 2013, we expect Buddy Media to contribute approximately $20 million to $25 million in incremental revenue, depending on the eventual close date in Q3. As referenced, the high end of this range is just slightly less than the amount of revenue Buddy Media generated for all of calendar 2011. This revenue estimate includes a provision for some lost productivity in the month of acquisition. That's consistent with what we've seen in our prior M&A activity. When we add this amount to the full-year revenue guidance we gave on our Q2 results conference call, our current best estimate for fiscal 2013 revenue increases to a range of $2.99 billion-$3.025 billion.
From an EPS perspective, we anticipate the acquisition to reduce full-year non-GAAP EPS by approximately $0.14-$0.15, resulting in an updated non-GAAP EPS range of $1.45-$1.49 for fiscal 2013. While the acquisition is dilutive in the near term, I'm pleased to say that our current plan still calls for some year-over-year margin expansion, although less than our original goal of 75-100 basis points in fiscal 2013. We're not able to give you an accurate forecast of the GAAP EPS dilution resulting from the acquisition until we finish all the purchase accounting after the close. However, you should expect that the dilution impact on GAAP EPS will be significantly higher than for non-GAAP EPS because of the additional stock and amortization charges.
We estimate that the acquisition of Buddy Media will have a negative impact on operating cash flow of approximately $5 million in FY 2013, but we still expect full-year cash flow growth in the low to mid 20% range. A couple of final points you should be aware of. The vast majority of Buddy Media's billings occur on a monthly basis, we do not anticipate any meaningful impact to Salesforce's deferred revenue balance as a result of the acquisition. Second, we will provide revenue and EPS guidance for our third quarter, which will include the effects of this transaction when we announce our second quarter results in August. To wrap up, Buddy Media is a strategic asset, which we believe will extend our leadership position and increase our growth with solutions for a new fast-growing market.
The combination of Buddy Media with Radian6 makes our Marketing Cloud the most comprehensive end-to-end unified social media monitoring, engagement, and marketing platform in the industry. We look forward to updating you on the transaction and our progress in August. With that, we'll open the call up for questions.
At this time, if you would like to ask a question, please press star then the number one on your telephone keypad. We'll pause for a brief moment to compile the Q&A roster. Your first question comes from the line of Ross MacMillan with Jefferies.
Thanks a lot. Congratulations on the deal. I had a question for Marc, first of all. Aside from the leadership position that Buddy Media has, and obviously the strong leadership team, what other facets of the business were particularly attractive?
What we really liked when we looked at Buddy Media, and we reviewed every single company in the space, and I actually met with about 10 of the CEOs of the major companies in the process, is first of all, I love that, of course, Buddy Media is the number one provider in this area. The more time I spent, the clearer it was to me that we needed to buy number one, and that that worked incredibly well with Radian6. We picked up an incredible executive with Marcel LeBrun, an incredible company, and that was number one. Number two, what I really saw was that you had this incredible opportunity, whether it was corporate functions or the PR teams, digital teams in these companies, e-commerce teams, creative agencies, media agencies, their PR agencies, social media agencies, their community managers, marketing managers. All of these
Disparate organizations are working with these marketing materials, they all need to log into these systems. Then they're dealing with things like granular rights management and workflow and benchmarking, but ultimately, they're managing all these corporate assets. How do they manage those assets, whether it's in presence or paid advertising or conversations? They're driving this content, as you've seen, onto Facebook and Google or Twitter, LinkedIn, YouTube. This is clear and simple, an information management problem, and involving not only the data associated with these objects, but the metadata as well. This is a perfect match for what we do every single day. That's why I got excited, Ross, because what I saw was that this is a tremendous extension to how Salesforce helps companies manage and share their corporate information and how we're doing it in the cloud. It's incredible.
We've seen incredible work that they've done with major customers like Ford and WPP, we're confident that we're going to be able to bring this to market with our Salesforce and provide all of our customers with a social media management solution, which is something that they all desperately need.
Your next question comes from the line of Kirk Materne with Evercore Partners.
Thanks very much. Congratulations on the deal. I guess, Marc, when you were going through the process, did you get the chance to sit down with some clients that were Radian6 and Buddy Media customers and get a sense on how they're maybe using the two platforms together today and what the integration of those two platforms will look like over the next, say, six to 12 months? Thanks.
I really appreciate that. Well, you're right. There's a strong common customer base between Radian6 and Buddy Media. What we saw was that the real synergy points are really when it's going to get connected back into our sales and service systems. You saw in the London Cloudforce program and the San Francisco Cloudforce program and Washington, D.C., how we have created the social media hub based on Buddy Media that now ties back into salesforce.com. I think that's going to be the real leverage points. The real leverage points are the hundreds of thousands of customers that we have using our cloud CRM products that need to deeply integrate these services back into what they're doing. When we deliver that kind of unified offering, like we've already done that now between Radian6 and our sales and service clouds.
When we do that now with Buddy Media, just the total power to our customers to manage all their customer information is really just incredible.
Your next question comes from the line of Adam Holt with Morgan Stanley.
Thank you. I had, I guess, a follow-up to Kirk, a little bit about the end market and the selling process. Could you tell a little bit what their customer mix is like between agency and corporate, and how you see synergy on the go-to-market side with your existing platform? Then I had a quick follow-up on the model, if that's possible.
Well, I think that the key is, you probably know that we're really on a march in marketing where we expect that CMOs will still soon spend more than CIOs in technology spend. If you just look at it between 2011 and 2015, it's a movement of $4.3 billion-$6.5 billion. We've seen that obviously in our customer base. You've seen that when you come to our programs. What is happening is that these CMOs are tightly partnered with the CIOs, and in some cases, these CMOs even have their own CIOs, but the CMO is the buyer, pure and simple. In this case, the line of business is the dominant buyer. It's a unique line of business opportunity with the marketing professional.
It's not so dissimilar to the sales professional and how we've become so successful in Salesforce automation by creating a sales organization that is specifically targeted to sales professional. We, of course, have created an incredible success with our Service Cloud by augmenting that. Now, we've been building, since we acquired Radian6, a sales organization that's specifically targeting the marketing professionals. This is a segmented sales force. Our core sales force gets compensated for sales by the sales organization, but this is a marketing-specific sales organization. This marketing organization has the opportunity to be able to sell lots of products. We feel like we're building this incredible channel to deliver that. Now, we can take the Radian6 sales organization, and we can augment it with this product. Of course, the Radian6 sales organization gets augmented with the Buddy Media sales organization.
Our goal is to build a large direct sales organization to these CMOs and provide them with a complete suite of offerings. We have on the call Marcel LeBrun, who is our head of Radian6, and I'd just like to have him speak briefly to that distribution strategy and the overall product strategy for Radian6 and also for Buddy Media. Marcel?
Yeah, good morning, Marc, and good morning, everyone. Obviously, we're very excited about this. As Marc said, we're building aggressively a dedicated CMO-oriented sales organization. The thing that we're seeing, of course, is that when we talk about the biggest transition in 60 years, what we're seeing is CMOs are looking at social has gone from this thing that they're experimenting with to now the central core of their marketing strategies. The big transition is rather than focusing on how do I get impressions and reach and eyeballs and that kind of traditional view, it's now all about engagement. It's about how do you build relationships and connections with your customers. The number one thing that we're hearing, that we've been hearing is, yes, we've been listening, we're engaging, but we need to tie it all together.
That's really what led us to look at this space and to really now build what we believe is the first, actually the only end-to-end social marketing platform where we can do our listening, we can gain customer insight, listening to the voice of the customer. We can engage, we can publish on social channels, we can advertise and then measure, which is really key because CMOs are saying, "I want to put more of my investment here, but I need you to show me how I'm getting the ROI." That's really what we're pulling together here.
Thank you very much.
Next question, please.
Your next question is from the line of Heather Bellini with Goldman Sachs.
Hi. Great. Thank you very much. I just had, I guess, two quick questions. One, Graham, I was wondering if you look out to fiscal 2014, I'm getting asked by a lot of people this morning if you could give us any color on how we should think the deal will impact your numbers in that period. Will it be accretive? Will it be breakeven? I guess that would be the first one.
Sure, Heather. We've talked generally about these kind of transactions we're looking on a profitability basis, typically to get them to breakeven within four to eight quarters. That depends on the growth rate, depends on how aggressively we're investing. You've heard about, obviously, our plans for some of the distribution capacity build-out that we're going to be doing here. I think you should think of it in those terms. Obviously, we haven't given any guidance at all around FY 2014, so I'm not going to comment specifically on any more impact.
Okay. Then the follow-up question for Marc would be, clearly you're putting together this Marketing Cloud, which seems to be unlike anything else we've seen from the competition. I guess I'm just wondering if you could share with us, as you look at your go-to-market opportunity in this area and your ability to connect the dots, who do you see as your current or potential competition in that area?
Well, I think the right way to think about our strategy is, at the top line, we have a suite of applications that are CRM applications, Sales applications, Service applications, and Marketing applications. There's no doubt, Heather, that today we can view CRM as the true enterprise software mega market. I think we have enough data to recognize, as an industry, that this is really the sweet spot for enterprise software today. You look at that Gartner report that just came out, it is far and away the number 1 category for CIOs. They are just inundated by Sales and Service and Marketing professionals, and that's why it's 58% of those CIOs say they need to make CRM decisions this year.
Now, after we get down underneath that application category, you know that we've built these apps on our Chatter platform, we made a decision several years ago to have a strong Facebook-like collaboration platform that's deeply integrated into our service. Not something that's sitting on the side, but a core part of all of our applications. Underneath that, we have our fourth-generation language development environment, which is Force.com. That is supported by the acquisition that we made about two years ago, called Heroku, which manages the three GLs that deeply integrate on our system, whether it's Ruby on Rails or Java or PHP. We now have more than two million apps that are running on that Heroku environment.
Then we have our Data.com service that's providing data back up to Sales professionals, Service professionals, and Marketing professionals that helps them to keep their data clean and connect them more clearly with their customers, whether it's directly through the traditional channels or even in the social media channels. We'll have more to talk about that at Dreamforce in September. All of that runs on Database.com, which, as you can see, delivered its record number of transactions yesterday, and that's an amazing part of our service. We've been able to deliver a tremendous amount of reliability, stability, capability. When you look at the other mega vendors, whether they're SAP, whether it's Oracle, whether it's Microsoft, you take a look at our system, you just take a look and you can see that on June 1st, we provided 757 million transactions.
On June 4th, we provided 218 million transactions. On May 31st, we provided 831 million transactions. We're on our way to doing a billion transactions a day on trust.salesforce.com. Who else in enterprise software is getting ready to do a billion transactions a day, and we report all that publicly, too. This is the mega market, cloud computing, social computing, mobile computing, and CRM. That's what I think that what you're really seeing here. All of this delivered, whether it's our core CRM apps, Sales Cloud, Service Cloud, and Marketing Cloud, whether it's our Chatter collaboration layer, our force.com system, our data.com system, database.com or trust.salesforce.com, no vendor can match the success that we've had in this area. When you take an acquisition like Buddy Media and you lay it into this is something that the hundreds of thousands of customers that we have want.
They want to extend their Salesforce implementations with this next generation of data, which we call marketing. That's what I'm excited about, and that's what I think about now every day. I think that this is why I think that we're very uniquely aligned to be able to provide this directly to our customers. We are uniquely aligned because of the focus that we have, because of the throughput that we have, the direct sales organization, and fundamentally, the success that our customers have had with our model and with our capabilities. I hope that answers your question.
Great. Next question, please.
Your next question comes from the line of Jason Maynard with Wells Fargo.
Hey, good morning, guys. Marc, I just have one follow-up on, as you look at this market opportunity around selling to the CMOs. There's a wide range of products and technologies right now that are trying to solve this problem, and you talk about having an integrated management issue. When you think about your footprint today, and you think about your partner footprint. How do you balance the need of preserving your vibrant ecosystem with delivering all of these solutions to that buyer in a common integrated manner? Thanks.
Well, I think that at the end of the day, you see that we're doing that, and you have to provide it on an integrated platform. I know that other vendors, because of our success, are trying to stitch it all together through acquiring at the core. We don't acquire at the core. We're acquiring at the edge, and then we're able to take the edge and integrate it to our core. We knew that we couldn't acquire at the data management layer. We knew that we couldn't acquire at the collaboration layer, for example. We couldn't acquire at the core data management layers. If we were going to acquire, we were going to have to acquire these companies like Radian6 and Buddy Media, and others, and then stitch them into this solid core that we have.
I really think that's what's created the success for our customers, is how we've architected it. It's also very much the six or seven core layers of our system and how we look at it. That's made a huge difference for how we've delivered this to our organization. At the end of the day, we recognize that companies like Oracle and Microsoft and SAP, they look at us and they wonder, here's a company that's just given guidance over $3 billion this year, and growing at a rate well ahead of where they've been. The way we've done it is been totally transparent. We've been 100% focused on cloud, social, and mobile, and now we've really extended our services into sales, service, and marketing, and delivering the core social platform that makes all of that successful. It's no mystery, Jason, for someone like you.
You've seen how we've done it. We're just continuing to extend our reach, and that's why it's exciting to be able to bring in a great new company like this.
Your next question comes from the line of Brendan Barnicle with Pacific Crest Securities.
Good morning, guys. You mentioned the international offices and the international brands that Buddy has. What percentage, roughly, of revenue was coming internationally? As you look at that international expansion, developing out the dedicated sales force for that, does that look any different than how you're doing the international expansion and distribution on the other parts of the business?
Marcel, do you want to answer that?
Sure. It does match, relatively speaking, where our sales force is making their investments. We are building out this year very aggressively in Europe through all of the major markets that Salesforce is invested in, and we're seeing great traction in the U.K., and we're seeing great traction in Germany. We're also seeing amazing traction in Asia-Pac, primarily in Australia and New Zealand, but we're also expanding as well into those markets. The thing that we're seeing that's unique with social, of course, is that many of our customers are multinational customers, even if they might be based in Japan or they might be based in the United States, but every market is important. We have U.S. customers where India's an important market, China's an important market. For our products, it's important that our products are international right from day one.
We support Chinese language and Chinese engagement in Chinese social channels and all the different networks that matter in each country. For us, it's very much a global business, but we're seeing huge growth in particular in those markets that I mentioned.
Your next question comes from the line of Brad Zelnick with Macquarie.
Thanks very much, and I echo my congratulations. Marc, it's nice to see you further increase your presence here in New York. Graham, your updated guidance seems to imply Salesforce.com is able to invest and accelerate innovation in the Marketing Cloud to make Buddy Media much more valuable than it was as a standalone business. Maybe this question is best for Michael Lazerow. I don't know if he's on the call. What can they now do with the backing of Salesforce.com to further the distance, and further the lead ahead of competitors like Vitrue, Wildfire, and others?
Yeah, let me take it. Michael is not on the call. Look, at the end of the day, they have the best product. I know that because I went through all the products, and I met with every CIO, and looked at every technology, and went through all the architectures and all the platforms. They absolutely have the best product, the most complete product. Because their product ranged everywhere from advertising management, which was extremely unique, and I didn't see any other vendor that did that, all the way to doing the core social media management marketing and doing it in a multi-tenant architecture. They also have the largest transactions. None of the companies that I saw were doing transactions larger than Buddy Media because they had the true enterprise-quality product.
When you look at the transactions that they were doing with companies like Ford and others, it was super impressive. Great product, enterprise quality. Your question was, how do we accelerate something like that? There is one answer. The key to being successful in the software market is manifest destiny. Software's not a zero-sum game. Software's a huge market. CRM is the core mega market in enterprise software today. How do you achieve manifest destiny in the software market? It's all about distribution. Do you have enough salespeople to cover the millions of companies in the world who need this product? The reality is, for a company like Buddy Media, they've got a great product, but they're distribution-constrained. We're distribution-constrained at Salesforce.com. Certainly, Radian6 was distribution-constrained a year ago when we bought them as well.
Our ability to invest and grow distribution, which is one of our core assets, and I would say one of our core competencies at Salesforce, and the ability to consistently execute that in a public environment over so many years, 13 years of operating history now, this is what we bring to Buddy Media. It's a great product. This is the time in the market that people need this product. We are the ones who are able to operate the distribution channel. We need Michael and Marcel to deliver a world-class offering, and we will market and sell the heck out of it. Marcel, do you want to add to that and kind of your experience over the last year working with Salesforce?
Yeah, I agree. I think the part that transformed for us was the distribution. Salesforce has an amazing core competency there. Since we've joined Salesforce, we've had record deals every quarter since we've joined. We're seeing deal sizes go up. We're seeing our coverage go up. We're seeing as well with the social enterprise license agreement, where we're doing deals across the whole front office of the enterprise, where we're selling at the CEO level, and we're coming in and we're helping to transform businesses into social enterprises, and we're really doing everything across sales, service, marketing, and then also platform to really help businesses transform. It's been an amazing journey for us, and we expect obviously the same as we work with Buddy Media.
Your next question comes from the line of Laura Lederman with William Blair.
Yes, thank you for taking my question. Can you talk a little bit about things like renewal rates at the business? Were they in line with yours or higher? Any plans to take the product way down market? One of the things that Salesforce has always been is for the very largest company and the very smallest, maybe help us understand how you extend the reach of the product to smaller businesses as well. Thank you.
Laura, in terms of attrition rates, renewal rates, those kind of things, we're not at a point yet where we are going to give any detail on that. Obviously, we want to spend time making sure that we've got a consistent basis of measurement. Clearly at some point after the acquisition closes, we might be in a better position to comment on that market. If you want to talk about going to the smaller customer base.
Right. I think that the key to managing the cloud business is we look at attrition in aggregate, because different products and different markets have different attrition characteristics. That's also true in different geographies, different segments of business, small business, medium business, and enterprise. They all have different attrition characteristics. There's no way that we could give you, for example, guidance on attrition by segment. It would be crazy and extremely difficult to do. We could do it generally as we did. I think we've told you our attrition has dropped to one of its lowest rates ever, and I think we said that it's now in the low teens.
Specifically, I think that what we're seeing is just this unbelievable opportunity to help companies manage their customer information in a whole new way, and to create a much higher fidelity with the customer than they've ever been able to experience. Certainly, when we started with Salesforce automation, it was very much all about high-touch selling. That's evolved. You've seen how we've moved our selling product from not just high-touch selling, but even today with Chatter customer groups, with the ability to have a dynamic real-time conversation with the customer. That got extended to customer service and support, and the work that you've seen with customers that we've made, whether it was with KLM or Bank of America. We showed you how the whole concept of customer service was changing through social media. We acquired Radian6 a year ago.
We further amplified that our customers needed new ways to listen to their customers and to interact with their customers. We showed you how even something like Radian6 could go and start creating cases and extend the value of our Service Cloud. It's really the combination of these three things, sales, service, and marketing, that create that really incredible customer experience. Marcel, do you want to add to that?
No, I think that was great, Marc.
All right, we have time for-
Nothing more to add.
We're dragging it out. We have time for just a couple more questions, Nicole.
Your next question comes from the line of Terry Tillman with Raymond James.
Yeah, thanks for taking my questions and congrats as well. Hey, Graham, just a two-part question for you. In the most recent, let's call it couple quarters, what had been the top line growth trajectory for Buddy Media? Is this going to be similar to Radian6 last year where you're recognizing revenue on cash collection, which affects the initial revenue contribution? Thanks.
Yeah, Terry, I gave you obviously some clue when I said the high end of our range of 20%-25% was slightly less than Buddy Media's full year calendar fiscal 2011 revenue. That gives you a sense of the growth trajectory they're on. We're not going to comment any further than that. In terms of rev rec, no, this is a very clean revenue process. As I mentioned, they tend to sign up customers on annual contracts but actually bill them monthly. We will be recognizing revenue sort of on the same basis that we do for all of our core products. There will be no cash recognition transition.
All right, Nicole, bring us home here. One final question.
Your final question comes from the line of Steve Ashley with Robert W. Baird.
Great. I was just going to ask on the front end of the business, with Buddy Media, the mix between B2C and B2B, how is it today? Do you foresee that possibly changing in the future?
Great, I'd love to have George Hu, our Chief Operating Officer, who led this acquisition, chime in here on that.
Thanks for the question. We're really excited about this opportunity because, of course, the initial early adopters in this area for social marketing are traditionally the B2C companies. It's where you see a lot of those companies like Mattel and L'Oreal. What's really exciting for us is the opportunity to bring it into really our traditional strength, which is B2B, and dramatically expand the market by combining really the best of these two areas. It also allows us to really penetrate more deeply the B2C segment, which is a newer area for Salesforce. We think this is a great opportunity for both sides to really grow into each other's bases. I think at the end of the day, the Facebook trend, social media trend, is something that's going to impact all companies. We're seeing that across all companies in our customer base, B2B, B2C.
This is a tremendous opportunity. This is the future, and I think this is just a win-win for both sides.
All right. Great. Thank you all for joining us, especially those on the West Coast, where I know it's obviously very early. We've been consuming lots of coffee here. If you have any follow-ups, feel free to reach out to the investor relations team. Thanks for joining us, and we'll talk to you all soon. Bye now.