Salesforce closed the lid on its Slack acquisition this week. That’s almost $28 billion in Slack’s coffers and lots of welcome media buzz for Salesforce. But what is it really going to do for Salesforce’s customers and does it place Salesforce in direct competition with Microsoft and the ever-growing Teams juggernaut?
After all, Salesforce may have almost invented customer relationship management (CRM) way back in 1999, but Microsoft was pretty close behind. It just did that typical Microsoft thing where it waits two years to see if the new trend really has legs. Then, when it pumped out its own CRM solution in 2001, it pretty much face-planted with the first version of Dynamics CRM. Another Microsoft tradition! But unlike most companies, Microsoft tends to eat that first flop and then keep on swinging. Fast forward about 20 years and Microsoft is a serious player in the CRM space. Serious, but still not the obvious, go-to solution. If you talk CRM, even today, you’ll quickly wind up talking about Salesforce.
That might seem weird since the two are similar companies. Both are behemoths, and you can tell that from the marketing language they use; phrases like “speed to innovation” and “scale with confidence” that turn my brain into a pile of lug nuts. And there are other massive players in CRM, too, like Oracle and SAP. But for all their massive back-end muscle, they’re not leading the CRM conversation either. Oracle has NetSuite and SAP has something it calls its Customer Experience and CRM platform, but both are mostly sales skins with which to sell database technology. But then, CRMs are largely about databases, so why is Salesforce so dominant?
Maybe it isn’t. Taking Microsoft as an example, it already leads Salesforce in the breadth of functionality. CRM-to-CRM the Microsoft Dynamics offering is comparable to Salesforce, but with Azure and Microsoft 365 both tightly integrated with Dynamics, Microsoft offers a big bucket of additional functionality. And while Salesforce touts its large list of value-add “Trailblazer” partners, the Microsoft partner ecosystem is not only older, it’s considerably bigger, too.
Now add in artificial intelligence, advanced analytics, and an awesome database, and you’d think all that would put Microsoft in a much stronger position feature for feature. So why haven’t more CRM dollars and buzz flowed up to Redmond? Short answer: because Microsoft, Oracle, or most any other large player wants to focus on their long-term mission, namely conquering the world. That means as many customer swaths as possible until even their mid-level managers can afford a $25 million 10-minute space vacation. Salesforce just wants to own the sales and marketing audience, and they’re purpose-built to do it.
The CRM itself isn’t the deciding factor here. Salesforce isn’t that far ahead of its competitors in that particular area. You’ll still eat a learning curve with Salesforce, it is a snack compared to the compendium you’ll need to digest from both Microsoft and whatever partner built your Dynamics instance. Salesforce customization sometimes requires a developer, but Dynamics almost always does.
The real differentiator is that Microsoft integrates with its strongest platforms, Azure and Microsoft 365, and both are wide-audience platforms. Salesforce integrates with its strongest platforms, but those are the tools that sales and marketing professionals need. Tableau might be a general-purpose analytics platform, but Salesforce has certainly tweaked it for audience and sales data. Pardot does multi-channel marketing automation, including email, social, and mobile. There’s a full e-commerce suite in Commerce Cloud 360 along with a shopping cart, payment processing, the whole shebang. The same goes for the help desk and customer experience tracking. Salesforce has tools specifically designed to answer all those needs, and those are the needs sales and marketing professionals actually have to fill. And, bonus, they all talk to each other, too.
Microsoft and the other large players have none of those products directly. In Microsoft’s case, it wants to focus on selling the underlying features — elastic infrastructure, DevOps, streaming analytics horsepower, and more back-end oomph. Let customers or value-add partners build the actual marketing solutions. But that’s at least two separate sales engagements for a typical Dynamics customer, probably more. With Salesforce, it’s just one and done. The company has even extended some of that into the small and midsized business (SMB) market with Salesforce Essentials, a product specifically designed for smaller, potentially more inexperienced salespeople and marketers. By comparison, Microsoft seems to think if it adds “365” to the end of something that makes it small business-friendly.
So now drop Slack into the mix. It’s exciting. It’s definitely a hybrid work feather in Salesforce’s cap. But for straight hands-on-keyboard marketing activities, it’s more of a useful convenience than a must-have. Especially now that the last year and a half has forced most companies to already have a Slack-type team collaboration solution up and running. For help desk and e-commerce, it’ll definitely give Salesforce a functionality boost. But for the rest of its suite, you’ll read a lot of nap-inducing language around Slack-first powering “peerless collaboration.” Maybe that sounds enticing, but, frankly, if your innovation and collaboration are resting entirely on either Slack or Teams, you’ve got bigger problems.
Salesforce needs Slack to kick up buzz and make the new hybrid work world take notice. Done deal. And that will certainly help Salesforce keep its current customers happy. But as far as attracting new, sales-savvy customers goes, I’m betting those folks will be looking at a long list of other features before they ever get to “Slack-first.” In fact, for all those Slack-only customers who don’t want to deal with Salesforce, it might actually drive some revenue towards Microsoft Teams. Disagree? Hit me up in the comments.
