April 26, 2019, was a momentous day for business messaging and collaboration software.
Slack filed for an initial public offering (IPO). For those of us less financially-savvy, an IPO marks when a company starts selling stock to the public, as opposed to a small group of private shareholders.
Slack's IPO is slated for June 20, and the public is quite interested in the details. Tech and finance bloggers are in a frenzy of conjecture about possible share prices and profitability estimates.
Slack’s influence in business messaging is undeniable, so it seems like an easy choice for those interested in buying stock. It’s easy to count out potential competitors in what appears to be a monopolized market, but with a closer look, Slack might not be as many miles ahead as one might believe.
How does Slack compare to competitors in business messaging?
With Slack’s IPO impending, the best markers for market success are how it fares against competitors, where it excels and where it needs improvement. It’s even better if this information comes from users themselves as opposed to investors that might have biases or a stake in investment one way or another. This gives potential stock owners an idea how Slack will fare in the future, based on how it compares to its main competitors right now.
According to G2’s review data, Slack’s excellent reputation is definitely warranted. Across multiple metrics and features, Slack often ranks best compared to Microsoft Teams and Workplace by Facebook.
G2 asks users to rate their satisfaction with these products through the categories Meets Requirements, Ease of Use, Ease of Setup, Ease of Admin, Quality of Support, Ease of Doing Business With, and Product Direction.
Slack ranks highest when compared Microsoft Teams and Workplace by Facebook in all metrics mentioned above. Its highest score is 9.0, which it earned in three areas: Meets Requirements, Ease of Use, and Ease of Doing Business With.
Its lowest score is in Product Direction, where it scored 8.5. It was followed closely by Microsoft Teams (8.2). Workplace by Facebook scored more than a point lower than Slack in Product Direction, earning 7.4 for the metric.
What all this tells us is businesses that choose Slack are satisfied with the product and how easy it is to acquire, set up and maintain. While Microsoft’s and Facebook’s scores are relatively high for the category, Slack is the clear leader in overall satisfaction.
The features in the Communication section include status updates, instant messaging, activity feed, notifications, comments and voting, discussions, user directory and online status of coworkers.
Slack scored highest in satisfaction across these features, but was tied with Workplace by Facebook in status updates, activity feed, and comments and voting. Unsurprisingly, Slack’s highest score in this section is in instant messaging, where it scored a staggering 9.5, followed by Microsoft Teams (9.0) and Workplace by Facebook (8.8).
Slack’s lowest score in the Communication section is in user directory (8.4), followed closely by Microsoft Teams (8.2) and Workplace by Facebook (8.0). While these scores aren’t terrible, it seems these products could stand to create better user directory interfaces.
The features in the Content Management feature section include file sharing, document collaboration, version control, tagging, knowledge base, and surveys.
Slack has the highest score in three areas: file sharing, tagging, and knowledge base. However, it scored behind Microsoft Teams in document collaboration and version control, and behind Workplace by Facebook in surveys. While Slack isn’t last in any of these metrics, these findings show Slack isn’t infallible.
Groups work best when collaboration between tasks is seamless. Slack’s score of 7.9 in document collaboration and 7.6 in version control might be a turn-off for businesses looking to bundle their document creation and messaging capabilities into one product. That doesn’t mean Slack can’t easily make up for those faults. The product still earned the highest scores in half the features in the Content Management section, so it's not working from the back foot by any means.
The Software Offerings section determines if products are available as mobile applications and/or web applications. It also covers product integration and support.
Slack is the top dog in both mobile application (9.1) and integrations (9.0) and ranks second in web application (9.2), slightly behind Workplace by Facebook (9.4).
These findings are consistent with popular opinion of Slack’s product. Slack’s mobile app provides a clean, intuitive interface that includes all the functions and information found on its web app. Work culture in the modern age requires teams to always be on and available, and that’s only possible with robust business messaging apps.
Slack also loves integrating with other software products across an organization’s technology stack, making it easy to move information in and out of the app. The more a business can connect its stack, the more likely it is to keep tools and, more important, enjoy using them.
The Administration section covers the following features: moderation; user, role, and access management; and performance and reliability.
Slack tops the charts in this section, scoring 8.6 in moderation; 8.7 in user, role, and access management; and 9.0 in performance and reliability. The largest difference between scores in this section is between Slack’s moderation score and Microsoft Teams’ (7.5).
Products that are easy to maintain and can perform consistently are usually successful, and Slack's users rate it best in class in terms of reliability and ease of maintenance.
Where can Slack improve?
As illustrated in the previous section, Slack’s impeccable reputation is deserved. However, it’s far from perfect when considering all the additional functions businesses now look for in their messaging and collaboration products.
The conferencing tools section consists of audio conferencing and video conferencing, and Slack is not top-rated in either. In fact, it has the worst score of the three products in both categories.
Microsoft Teams scored highest in audio conferencing (8.7), followed closely by Workplace by Facebook (8.6) and Slack (8.1). Video conferencing was led by Workplace by Facebook (8.7), with Microsoft Teams tailing (8.4) and Slack even further behind (7.8).
Many businesses won’t necessarily consider this a downside since they typically leverage separate products for business messaging and video conferencing. Video conferencing software is also often intended for external use, which internal communication products aren’t concerned with.
However, an issue arises when considering that one of the main draws of business messaging is effective internal collaboration. Having the ability to move between text-based conversation and audio- or video-based communication streamlines decision-making and knowledge transfer. Businesses are already prioritizing tools that have multiple avenues for communication, and if unaddressed, this hole in Slack’s armor could prove painful in the long term.
The Productivity Tools section includes task management, calendar, search, mobile, and multi-language support.
Slack has the best score in mobile and is tied with Workplace by Facebook for first in search. However, it falls behind Microsoft Teams in task management and ranks last in both calendar (7.5) and multi-language support (8.0).
The most noteworthy point here is Slack’s comparatively low satisfaction rating in multi-language support. While it’s less than half a point behind the next highest-rated product, this might indicate a potential weak point in all three products, as opposed to a weakness in Slack. The ability to contribute in multiple languages can be critical for companies with locations across the globe, which is commonly the case for enterprise-level businesses.
Branching to mid-market and enterprise businesses
Based on demographic information from reviewers of each product, Slack dominates the small-business sector. Of Slack’s 16,435 reviewers (as of publish date), 46.1% worked for small businesses. This is leagues above Microsoft Teams small-business reviewer representation (16.8%) and moderately higher than Workplace by Facebook (30.7%).
While small business is definitively Slack’s arena, its outlook for taking on large businesses is dicier. Microsoft Teams appears to be the favorite for mid-market companies — 44.5% of its reviewers hail from companies with 51–1,000 employees. Slack is trailing with mid-market companies, with 36.7% of reviewers, followed by Workplace by Facebook with 31.5% representation.
Microsoft Teams and Workplace by Facebook are neck-and-neck in terms of popularity with enterprise businesses. The former’s enterprise reviewers make up 38.8% of its total reviews, while the latter’s enterprise reviewers represent 37.8% of reviews. Slack’s enterprise review count stands at 17%, a stark contrast to its two competitors.
One could argue that Slack has found a comfortable niche for itself as a small-business staple, but, taking growth into account, this isn’t a great model. Businesses want a tool that can grow with them, and Slack would do well to accommodate companies as they expand to ensure they don’t hop off-board after reaching a certain threshold.
Should you invest in Slack?
In all honesty, I’m not a professional financial advisor. However, Slack’s success and user satisfaction speaks for itself. The company has done well for itself to this point, as evidenced by an IPO announcement just five years after launch. Slack is an affordable, reliable product with few hiccups. The functions it doesn’t provide are often easily filled by more specialized tools.
Slack isn’t unbeatable though, and competitors would be wise to take note where it falls behind. Taking advantage of those blind spots could easily make a new product a strong competitor.
Interested in a business messaging for your company? Slack is by no means the only solution out there. Compare 175-plus internal communications software products with thousands of reviews on G2.
Jazmine is a senior market research analyst focusing primarily on all the facets of collaboration software. She’s built her expertise and knowledge of the market from the ground up. By leveraging inside vendor knowledge with in-house analysis of G2’s review data and surveys, she’s created a holistic understanding of the otherwise complex collaboration and content management markets. When she's not at G2, she's playing video games or watching Lord of the Rings for the hundredth time. Her coverage areas include: collaboration & productivity, and content management.