Salesforce buys Slack
A week after the news broke that Salesforce were looking to acquire Slack, the deal is done — we knew it would be, so that it could be announced at the Dreamforce to You keynote. It turns out that talks started some time ago, but with Slack talking to Salesforce about an acquisition of Quip. This would have been a real surprise, as I can’t recall Salesforce ever selling on an acquisition, although they have shut a few down (including my favourite todo list, do.com).
In my previous post I touched a little on why Salesforce would need another tool to collaborate outside of the Salesforce instance, and I’ve been thinking more about this.
Chatter is a great tool for collaboration around Salesforce data, allowing you to combine structured information in the record detail and related records with unstructured data in the chat. You can see the historic discussion around changes to the record, not just which fields changed, and understand more about the lifecycle of a record. Did a case involve pulling in additional teams, did a Sales manager have to chase up a rep to progress an opportunity. All of this is valuable information which is hard to capture on a record without having a million related records.
Chatter groups are also useful in the context of Salesforce data. Being able to @mention a group regarding a record, using the same example from above, if there was a case that required a specialist team you could get their attention with a single post. They are less good at general collaboration in my view — while I use groups a lot, it’s for headline type posts — announcements or asking if anyone has seen a specific problem before. But only for the initial contact. Once the protagonists are identified, any further collaboration is typically carried out via Google Chat, Slack, email or videoconference. Essentially I find hem a way to get the attention of the right collection of people.
I don’t think Chatter was helped by the investment drying up after a few bumper years. The desktop application lagged way behind the web interface, and was eventually withdrawn, even though it was pretty popular. But the key sticking point to expanding to the wider company is the org-centric aspect. If you have multiple orgs, then people need to maintain multiple logins, which is a bit easier with mobile app as can easily switch, but still not ideal. You also need to be very clear which is the correct org for collaboration, even if it’s around something happening in another org. There were some third party solutions around providing single view of chatter across orgs, but generally these replicated posts across orgs and required additional licenses for the ISV product and often something like Heroku orchestrating the transfers. You also can’t integrate inside the feed like you can with a tool like Slack, although you can do a bit more around the feed with Lightning Experience pages. Automatic notifications also felt quite antiquated, as for a long time you had to construct a post through the Connect API, @mention someone, then detail what it was you wanted to alert them about. This has improved since the advent of process builder and custom notifications, but was introducing features that other tools had for years. Once Quip came along, that felt like Chatter was heading down the maintenance only route.
Communities were another attempt to introduce collaboration across the enterprise, and replace the intranet, that didn’t make it. What most companies wanted were a simple way to create a related set of pages (Google sites anyone?) for intranet type content and a way to collaborate on the content. What they got was a $20/user/month platform-lite style license, that pretty much guaranteed limited take-up. For example, I was working with a 4,000 person company who wanted to migrate their intranet to Salesforce. They had 300 or so existing Salesforce users, so needed around 3,700 community licenses, which would lead to a bill of around $75,000 per month, for an intranet that people would use to find someone’s phone number or figure out how to book holiday! Yes they could access up to 10 custom objects, but the vast majority had no interest in that. Without reasonably priced, login-based, entry level licenses, the employee community was always going to be priced out of the market. The employee community license was eventually withdrawn and users transitioned to a platform user license with a company communities for force.com permission set, which feels like what was actually being sold.
Against a dedicated solution like Slack, aimed at the entire company rather than specific groups of users, it was always going to be a difficult battle. Acquiring Slack gives Salesforce access to the entire enterprise, especially if they stick with the free tier. Yes you don’t get the history, but important information should not be stored in chatlogs. If people have to search back through the history of chats they may not have been involved in to find something they need, you’re doing it wrong.
Where the chat history is important, as mentioned earlier, is when it is colocated with a record, and this is why I think chatter will live on after the acquisition — people won’t switch to another tool to search for any messages related to the record they are currently viewing.
Slack may have lost $147 million last two quarters and may not have seen the growth that other tools have during the pandemic, but they also haven’t had the unstoppable force of Salesforce Sales and Marketing pushing it. According to Marc Benioff, 90% of Slack customers are also Salesforce customers Once the machine is tooled up to sell Slack, I’d expect the numbers to trend towards this in reverse — a massive existing customer base, existing access to the upper echelons of leadership, and a motivated (incentivised) Sales operation will, I believe, lead to a large amount of Salesforce customers becoming Slack customers.
Originally published at http://bobbuzzard.blogspot.com.
I’m better known in the Salesforce community as Bob Buzzard — Umpteen Certifications, including Technical Architect, multi-time MVP, and CTO of BrightGen, a Platinum Cloud Alliance Partner in the United Kingdom. You can find my (usually) more technical thoughts at the Bob Buzzard Blog