What were Slack’s success factors?

Small beginnings even for big things. A small developer with a shuttered video game refined and released their internal chat system, begging companies and friends at one point to try it out.

The application was Slack, and the company has gathered a combined 1.5 million paying and 5 million daily active users since its launch in 2014, ranging from Fortune 500 firms to dentist offices and NASA’s Jet Propulsion Lab. In 2016, the messaging startup was valued at $3.8 billion and was in talks this month to raise another $500 million at a valuation of $5 billion. It’s also reported to have attracted the attention of some deep-pocketed potential acquirers, including Amazon.

For those who might not be familiar, Slack is an enterprise messaging tool which is aimed at assisting team members to chat, work on projects together, and share links and more in real-time.

So what did Slack do right? Here goes:

1. Word-of-mouth marketing

In 2012 Stewart Butterfield (CEO and co-founder) and his team started working on Slack.
Before their August 2013 preview release, Stewart and his team started asking friends and acquaintances working at other companies to give Slack a go and see what they’re doing about it.

This helped the team discover how the company catered to the needs of the consumers and suited the market. It also helped them focus on basic design and core features.
The word-of – mouth approach worked brilliantly, because 8,000 people signed up to Slack on the day of release. Two weeks later this number had increased to 15,000.By February 2015, when the tool was publicly available, Slack had acquired 500,000 daily active users. Within four months, this number had doubled to 1.1 million active users.

Today Slack has 8 million daily active users with 3 million paid users and counting. If you are an SEO enthusiast, here is another benefit which will make you feel warm inside: 100.000.000 organic traffic/month of which 90% is driven by word-of-mouth.

2. Integration with other providers

They sell a reduction in information overload, stress relief and a new ability to extract the tremendous value of hitherto useless corporate archives. Not only is Slack a messaging app, it’s a collaborative hub that brings together the right people with the right conversations, information and tools they use at work. So teams need to make the most of their time to be successful and productive. So integrating with other tools that teams use on a regular basis was paramount to Slack’s success. There are more than 1500 apps in the Slack App Directory. Slack’s website attracts 100.000.000 visitors/month.

3. Twitter

Twitter is Slack’s most important social media platform. Here is how Slack used the 180-character (now 240) social media network:

  • Build brand awareness;
  • Define its tone of voice;
  • Keep their users up-to-date on changes, improvements, company life;
  • Get customer feedback;
  • Communicate with customers;
  • Prevent the Slack support team from scaling up massively: Slack’s customer support team is made up of just 18 people, with a group of 6 manning Twitter 24/7.

4. Content marketing

Content marketing didn’t become part of Slack’s growth strategy until 2014.
Unlike other companies, the team growing Slack made an interesting and bold choice: to host their company blog outside slack.com.

Slack’s blog is called SlackHQ.com and the online blogging platform was first a publication on Medium.com. At the same time, it was daring and risky and it worked great for Slack. The content published here took full advantage of Medium ‘s features and was also featured in the ‘Popular On Medium’ section on the Medium’s homepage. The blog managed to acquire over 125.000 followers, but in 2018 it was moved to slack.com.
5. Dear Microsoft

Microsoft announced on November 2016 it is launching its own competing product.
Slack seized this opportunity to gain media attention by publishing a letter in the New York Times addressed to Microsoft as a full-page ad. Here is the first paragraph to the letter:

“Dear Microsoft,
Wow. Big news! Congratulations on today’s announcements. We’re genuinely excited to have some competition. We realized a few years ago that the value of switching to Slack was so obvious and the advantages so overwhelming that every business would be using Slack, or “something just like it,” within the decade. It’s validating to see you’ve come around to the same way of thinking. And even though — being honest here — it’s a little scary, we know it will bring a better future forward faster.”

While the letter sets out to give Microsoft “some friendly advice”, it does so by highlighting the principles and values which Slack was built upon and taking a few jabs at Microsoft at the same time:

  • It’s not about features, it’s about “a degree of thoughtfulness and craftsmanship that is not common in the development of enterprise software”;
  • Thousands of hours talking to customers;
  • Internal transparency and a sense of shared purpose;
  • The necessity of working with an open platform and integrations.
  • And ultimately love: “We love our work, and when we say our mission is to make people’s working lives simpler, more pleasant, and more productive, we’re not simply mouthing the words.”

6. Fair Billing Policy

Like many other service apps and tools, Slack uses the freemium business model: free, standard and plus subscriptions. Out of the thousands of hours of talking to early adopters and customers, the team behind Slack found one particular pain point and came up with a solution.

What is stopping consumers from switching to a paid one on free subscription? One explanation is that businesses are paying for a number of seats, no matter how many workers use the program actively. A second reason is that employees sometimes become inactive, so that the company loses money because it pays in advance.

To this problem, Slack found the following solution: Fair Billing Policy.

Big companies like Airbnb, IBM, Oracle, Target, BBC, Workday and E-Trade count among Slack’s customers with approximately 70,000 businesses paying for the company’s services. And it doesn’t look like it is slowing down.

Check out my related post: Why does Spin Sucks?

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