Companies that don’t value trust as a top priority are going to have trouble keeping their customers moving forward, Salesforce.com chief Marc Benioff told CNBC’s Jim Cramer in a wide-ranging interview Tuesday.
Asked on “Mad Money” whether a company like Facebook can redeem itself following its breach of consumer trust, Benioff said that the table stakes for consumer-facing technology companies have fundamentally changed.
“Every company has to hold themselves to a new level of trust, and if your brand is not about trust, you’re going to have customer issues, and you can see that in that brand,” said Benioff, the co-founder, chairman and co-CEO of Salesforce.
Concerns around privacy and data usage have weighed on shares of big-cap tech companies including Google parent Alphabet as investors and consumers alike heard more about the eerily common practice of companies selling user information to third parties.
The rise of these concerns has led to the departures of high-profile employees at a slew of Silicon Valley names, but especially at Facebook, which saw leaders at its Instagram and WhatsApp divisions leave the social media company.
“Their executives are walking out, employees are walking out, and that happens with a lot of companies in tech right now. We’ve had a lot of walkouts this quarter,” Benioff said. “And the reason why is because it’s kind of a message to the executives: it’s time to transform.”
The Salesforce chief, who has worked in tech since he was an Apple programmer in the 1980s, outlined how tech companies have shifted their values in recent years to address these issues.
“In technology over the last two decades, the most important thing has been the idea. That is, the best idea wins,” Benioff said. “That has been what gets you funded, that’s how you grow your company, that’s been your highest value: the best idea wins. No longer true. The current highest value is trust, and if trust is not your highest value, if the most important thing to you and your company is not trust, you need to look again, and that’s what’s happening with these companies today.”
Salesforce’s stock jumped more than 7 percent in after-hours trading after the company’s third-quarter earnings report beat analysts’ earnings and revenue expectations. Also on “Mad Money,” Benioff said his cloud-based software provider has never “been stronger or been in a better position.”
Disclosure: Cramer’s charitable trust owns shares of Salesforce.com, Facebook, Alphabet and Apple.
Questions for Cramer?
Call Cramer: 1-800-743-CNBC
Questions, comments, suggestions for the “Mad Money” website? firstname.lastname@example.org