Slack May Never Catch Up with Microsoft Teams, But It Has a Big Future

Salesforce-centric organizations may soon have more reason to choose Slack as their central collaborations solution

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Slack May Never Catch Up with Microsoft Teams, But It Has a Big Future
CRMInsights

Published: October 18, 2024

Charlie Mitchell

Ever since its $27.7BN acquisition by Salesforce in 2020, Slack has underwhelmed.

Indeed, it has failed to gain ground on Microsoft Teams, which – after scooping up most “COVID contracts” – has remained the de-facto collaborations platform.

Now, Teams has over 320MN monthly users. According to DemandSage estimates, Slack has 65MN.

Slack has complained to the European Commission that Microsoft’s “anti-competitive” bundling of Teams and 365 provided it an unfair advantage.

However, in the four years since the Salesforce acquisition, Slack has failed to live up to its potential.

Indeed, upon announcing the acquisition, Marc Benioff, CEO of Salesforce, pledged to turn the collaborations platform into a “Digital HQ” for the enterprise.

At the time, he told CNBC’s Jim Kramer:

Slack [will] provide an incredible window, a collaborative interface for all of our services and the entire enterprise.

That vision elicited images of employees leveraging Slack to collaborate on customer cases, spotlight data from across Salesforce CRM apps, and orchestrate automations between them.

In this sense, Slack would become the operational center point of a Salesforce-centric organization.

However, over the past four years, the closest Slack has got to bringing this vision to life is incident swarming for customer service and Slack Sales Elevate.

Turnover amongst senior leaders has perhaps provided a stumbling block, with Slack burning through three CEOs in 11 months in 2023.

Yet, the bottom line is that Salesforce has failed to ramp up interest in Slack from its deep CRM base. As Liz Herbert, VP & Principal Analyst at Forrester, told the Wall Street Journal last year:

We don’t really see, when it comes to Slack, any pent-up demand from Salesforce’s base for a tool like that… It really hasn’t become something compelling.

Disney is one customer that did embrace the platform. However, it reportedly moved from Slack to Microsoft Teams following a data breach last month. That news broke just days after Salesforce paraded the company around Dreamforce 2024 as a revered customer.

From all this, it’s easy to frame the Slack acquisition as a continued failure for Salesforce.

However, that could all soon change. After all, at Dreamforce, Salesforce demonstrated a renewed focus on making Slack a success.

In doing so, it offered three compelling reasons why it may soon flip the Slack script.

1. Salesforce Has Completed Its Switch to Becoming a Platform Business

At Dreamforce, Salesforce announced that it had rewritten all its Customer 360 apps to develop a set of clouds that form a unified platform.

That move aided its ambition to sell the complete Salesforce stack – including Slack – rather than cross-selling various CRM applications.

Moreover, it paves the way for Slack to enable seamless cross-function data sharing, which will – in turn – increase the value of multi-cloud implementations.

2. The Combination of Slack and Agentforce Offers Promise

With the rise of autonomous AI agents, the future of collaborations becomes about creating a space where humans don’t only interact with AI but where they work together to automate processes.

Salesforce is at the forefront of this autonomous AI agent push with its Agentforce platform.

According to Liz Miller, VP & Principal Analyst at Constellation Research, that release could give Slack a significant advantage over its competitors.

“If Slack can enable actions through AI agents across different CRM systems without needing to log into them, that changes the game,” she said during a recent episode of CX Today’s Big News Update.

Imagine an AI agent learning something and then pinging you in Slack, saying, ‘Hey, you need to look at this.’ That’s a bit like science fiction… but it’s where we’re heading.

3. Salesforce Is Rearchitecting Slack

Some may pour scorn at the idea of Slack becoming the home of AI and human collaboration in the enterprise. After all, haven’t we heard all these big promises before?

However, earlier this year, the company reeled in Patrick Harris, the Co-Founder & CEO of Salesforce, to rearchitect the rearchitect and reengineer the platform.

That has already brought forward the release of Agentforce in Slack, providing a new UI for teams to surface Salesforce data and action tasks from the collaborations platform.

As Slack becomes part and parcel of the Salesforce platform, expect that offering to expand.

The Big Future

Slack can offer differentiators that its competitors can’t by becoming a more intrinsic part of the Salesforce platform.

That quest for differentiation is typically a problem in collaborations. After all, Slack may release one new feature, but after a few months, all its competitors will have something similar.

As such, the space has become somewhat commoditized, and – for some – a race to zero.

So, it’s no wonder why brands choose Microsoft, given its familiarity and cost-effective bundles.

However, by being that front-window into the Salesforce ecosystem – and perhaps becoming the AI orchestration layer across it – Slack can create differentiators that competitors cannot replicate.

That’s significant, as Salesforce is the standalone leader in CRM, with a mighty 21.7 percent market share, as per IDC. Its closest competitor is Microsoft, with just 5.9 percent.

Within that customer base lies Slack’s path to growth. Benioff has long anticipated that, but now it’s time to finally realize his vision.

 

 

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