Slack AI Adds a New Chapter to Sales Strategies
Credit: SLACK
A decade after its debut, Slack’s software for teamwork and communication has evolved significantly from its initial form, now incorporating artificial intelligence features aimed at enhancing user productivity.
Slack introduced its popular chat application 10 years ago, changing the landscape of business communications to be more efficient and casual. Although email is still widely used, Slack has significantly simplified the way coworkers share information and communicate, regardless of location.
Denise Dresser, the new CEO of the company, sees the implementation of AI-based tools as a chance for the company to influence the way tasks are accomplished.
Dresser expressed great optimism about the impact of AI on the future of work, stating that Slack is poised to lead the next decade of the AI-powered future of work, especially as the company celebrates its 10th anniversary.
The introduction of Slack AI earlier this year marked one of the most significant updates to Slack’s software in recent times. A redesigned interface was introduced in 2023 with the goal of maintaining user-friendly navigation while incorporating new features.
These enhancements included introducing canvas documents, enhancing video and voice call capabilities, and adding a task management tool. Automation through Workflow Builder remained a key focus throughout these changes.
Significant personnel changes have occurred recently as well. Stewart Butterfield, one of the co-founders, announced his departure in 2022, following Slack’s acquisition by Salesforce for $27.7 billion.
Since then, other senior leaders have also left the company. Lidiane Jones, who succeeded Butterfield as CEO, only held the position for a year before moving to Bumble, a dating app company. With Dresser coming on board in November 2023, this marks the third CEO in just over a year.
One of her main focuses is to expand the availability of Slack’s latest native features, like the newly released lists tool, to a wider range of customers. Additionally, she plans to further integrate AI into the platform following the release of Slack AI to the general public in February.
Another key area of focus has been to further integrate Slack into the Salesforce ecosystem in terms of both product development and customer sales strategy.
Dresser’s extensive background at Salesforce, where she has held multiple senior executive positions since 2011, will assist in aligning the two companies, according to Will McKeon-White, a senior analyst at Forrester.
Her appointment will aid in creating more effective joint go-to-market strategies, as well as streamlining and implementing operational processes for these strategies, which I fully support,” he added.
Challenges lie ahead for Slack as Dresser steps into his new role. The company’s growth has been decelerating, with quarterly revenue increases in FY2024 and FY2025 hovering around 16% to 20% year-on-year. This marks a significant drop compared to the robust quarterly growth rates reported by both Slack and Salesforce in the previous years between 2020 and 2023.
McKeon-White noted that Slack has been encountering increased obstacles lately, including issues with integrating after the Salesforce acquisition, a rapidly evolving competitive landscape with new rivals like Zoom, and changes in customer buying behavior following the pandemic.
Following the rush by businesses to implement communication software for remote work on a large scale during the COVID-19 pandemic, many companies subsequently aimed to consolidate the number of applications they were using.
Despite a slowdown in growth as the pandemic abated, the worldwide market for collaboration software still experienced significant double-digit growth in 2022, reaching a value of $33.9 billion according to IDC data.
According to McKeon-White, Slack seems to have been particularly affected by the shift, mostly because of strong competition from Microsoft’s Teams. Teams was introduced in 2016 in reaction to Slack’s rapid popularity in the workplace.
Customers who have already invested in the Microsoft 365 suite have found it logical to utilize the tools they are already paying for.
According to Irwin Lazar, president and principal analyst at Metrigy, there is a significant number of companies that have chosen to use Teams because they believe it meets their needs.
Microsoft has recently separated Teams from M365 for new customers (after facing antitrust issues with European regulators), but experts believe this will not have a major impact on Slack.
Despite this, McKeon-White mentioned that many companies are utilizing both platforms as they aim to provide various communication options for their employees.
“So, while there has been that gradual attrition and centralization, there’s now an emerging counter movement to that,” he said.
Wayne Kurtzman, IDC’s vice president of social, community and collaboration, noted that while there is rivalry between Slack and Teams, there is also a potential for synergy when they are integrated together. He mentioned that the combination of both platforms in an enterprise setting could lead to additional growth.
In a saturated market, there is still potential for expansion.
Analysts state that Slack is well positioned for growth despite facing obstacles. The platform’s efforts to enhance its functionality have been successful, increasing its value for users.
McKeon-White commented that the improvements are leveraging Slack’s strengths as a hub for collaboration and automation within companies.
Dresser made the argument that the value of Slack is evident based on the company’s customer survey data. The data shows a 47% increase in productivity, a 36% rise in sales win rate, a 32% decrease in customer service resolution time, and a 37% faster decision-making process in marketing.
According to Dresser, it is easy to convince customers of the benefits of Slack by emphasizing the platform’s impact on business outcomes. He believes that Slack is the hub for productivity, and the results clearly demonstrate that.
McKeon-White stated that the most obvious chance for expansion is to market Slack to Salesforce clients, although this is still in development. He mentioned that this presents a preexisting opportunity for them, but will necessitate collaborative marketing efforts and increased contract worth, such as platform discounts and other comparable strategies.
Future of Slack’s AI
One of the primary priorities for the company, like all other vendors in the collaboration and productivity software industry, is the integration of generative AI (genAI) tools.
Earlier this year, Slack AI was introduced with three functionalities
- AI powered search : Utilizing AI technology, the search function delivers tailored responses to inquiries by drawing from the organization’s database. Within Slack, the AI tool assists in identifying experts in specific fields and retrieving information on various topics, ranging from work assignments to deciphering unfamiliar abbreviations.
- Channel recaps : These focus on important topics of conversation for a Slack user who has been inactive for a while or for new members of a channel.
- Thread summaries : This function provides quick recaps of active discussions, offers summaries of threads, and gives a synopsis of lengthy conversations, complete with sources linked in each summary for users to verify information as needed.
According to Dresser, the main benefit of Slack AI is its user-friendly interface, which requires minimal to no training.
Credit: SLACK
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