Salesforce is reportedly in advanced talks to buy Slack with the aim of bridging collaboration with its sales and service clouds and expanding its reach, but the purchase is about playing defense as much as offense.
It's hard to view Salesforce's potential purchase of Slack as reported by the Wall Street Journal[1] in a vacuum. This deal isn't about product roadmaps and growth as much as it is competitive landscape. Sales and service have gone virtual amid the COVID-19 pandemic[2] and will largely remain that way. Yes folks, travel budgets for sales teams aren't going to come all the way back amid remote work[3].
Salesforce's biggest CRM rivals have collaboration platforms. Microsoft has Teams and its integration with Office 365 and a platform play[4]. And Adobe just acquired Workfront[5] and can integrate that project management platform with its clouds. Communication and customer experiences are merging: Note that Twilio's $3.2 billion purchase of Segment[6] illustrates the trend.
The competitive axis in CRM is Microsoft with partners like Adobe and C3.ai vs. Salesforce[7].
Salesforce has yet to nail the collaboration game. Salesforce launched Chatter in 2009[8], bought Quip in 2016[9] and just rolled out Salesforce Anywhere[10], but lacks the reach of Slack.
Nevertheless, Marc Benioff, CEO of Salesforce, has had a love affair for communication and collaboration for years. He even floated acquiring Twitter[11], but shareholder reaction thwarted the deal. Benioff lost out on LinkedIn, which was acquired by Microsoft[12].
For its part, Slack hasn't grabbed share amid the move to remote work. Zoom has become the collaboration darling as video