https://www.barrons.com/amp/articles...er-51607126763
Interesting article on the Salesforce-Slack deal. To me, the standout question is how Salesforce plans to scale uptake of Slack - that is the huge question looming on how to interpret this deal.
Salesforce has a large customer base of high paying customers (Fortune 500) given they are by far the leader in their space, but fewer small businesses, perhaps related to pricing. Conversely, Slack has a large base of free users (small business), with less than 1000 enterprise customers. So the two don’t perfectly align. On the other hand, Microsoft is ubiquitous among small and large businesses, and their office 365 suite comes with Teams for free. Teams has vastly outpaced Slack uptake this year in % gain, and not surprisingly total number of users greatly eclipses Slack. Teams integrates with other Microsoft cloud/office products, while Slack seems to integrate better with 3rd party apps. So if I’m a business owner, who has office 365 (and most do), why would I pay extra to have Slack if I get Teams for free? It would need to offer either superior security, superior reliability and performance or offer functionality that is compellingly different enough from Teams. I’d imagine most big businesses are looking to declutter the amount of software they use, so I’m not convinced 3rd party integration is the leap in functionality needed to sway a buyer. Similarly, if I’m a big business who uses CRM, why would I pay extra for my sales/marketing team to use Slack when the rest of the business probably uses Teams? So to me, there is a real possibility the deal for 28B eats into CRMs bottom line without much revenue generating prospect. Unless CRM plans to just bundle slack “for free” with their existing product and simply raise overall pricing?
I’d be curious to hear anyone else’s thoughts on the deal and how it affects CRM going forward short-mid term. I’ve contemplated buying CRM due to their dip and long term I imagine this deal is insignificant, but for a short term trade I’m not yet convinced and might wait until after CRMs investor day this week to see what they say.