NEW YORK (

TheStreet

) --

Salesforce.com

(CRM) - Get Report

is buying

Buddy Media

for $689 million as the customer relationship management (CRM) giant eyes social media dollars.

Buddy Media, which counts

Ford

(F) - Get Report

,

HP

(HPQ) - Get Report

and

L'Oreal

amongst its customers, help firms exploit their social media marketing with a technology platform that measures the effectiveness of firms' efforts and lets them test new initiatives.

Salesforce.com has announced a deal to buy Buddy Media

Rumors that Salesforce.com was eyeing Buddy Media have swirled for weeks, and the San Francisco-based firm is now flexing its social media muscle.

Salesforce.com, which is one of

TheStreet's

top tech stocks

for 2012, is ramping up its efforts against cloud rivals

Oracle

(ORCL) - Get Report

and

SAP

(SAP) - Get Report

. In particular, the company is charging hard around what it describes as its

"social enterprise"

strategy, essentially harnessing the power of social networking for the corporate world.

The Buddy Media deal follows Salesforce.com's purchase of

Radian6

last year, which now forms the basis of its Radian6 social monitoring cloud,

aggregating data

from the likes of Facebook,

YouTube

and

Twitter

.

Other Salesforce offerings in the "social enterprise" space include Chatter, a private social network for companies which is being deployed by the likes of

Verizon

(VZ) - Get Report

and

GE

(GE) - Get Report

.

The Buddy Media deal adds a key string to the Salesforce.com social media bow, according to CEO Marc Benioff. "Salesforce.com now has the number one players in social listening and marketing - Radian6 and Buddy Media," he explained in a statement. "With CMOs surpassing CIOs in spend on technology within the next five years, our Marketing Cloud leadership will allow us to capitalize on this massive opportunity."

The social enterprise message certainly seems to be resonating with customers at a time when businesses are attempting to harness the power of social networks.

Salesforce.com, which was recently

upgraded

by Oppenheimer on the strength of fast organic growth,

shredded Wall Street's estimates

in its fiscal first-quarter results last month.

Salesforce.com also delivered more than 52 billion social enterprise "transactions" during the first quarter, a 72% hike compared with the same period last year. The company's shares are up more than 26% this year.

"Salesforce.com's investment in social so far has reaped tremendous benefits as the company uses its 'social enterprise' message to engage with key decision makers and to drive much bigger deals," noted JMP Securities analyst Pat Walravens in a note released last week. "Buddy Media is a remarkable asset, in our view, that grew bookings over 200% in 2011 and would make salesforce.com the leader in the social marketing category."

Benioff's firm will pay approximately $687 million in cash and Salesforce.com equity for Buddy Media. The acquisition is expected to close during the third quarter of Salesforce.com's fiscal 2013, which ends on Oct. 31.

Salesforce.com shares were down 0.7% to $130 early Monday as the tech sector dipped into the red.

--Written by James Rogers in New York.

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.

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