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Bundling Effect

Bundling effect


Salesforce acquired Slack back in December 2020 for a record $27 billion.

Slack is a chat and collaboration platform increasingly used by startups across the world. Salesforce is a massive enterprise cloud computing company.

The Slack acquisition makes sense of Salesforce, it can bundle the solution with its existing enterprise offerings and boost Slack’s distribution.

Some say this is the only way Slack could have survived against Microsoft Teams.


Slack vs Teams

Microsoft launched its enterprise communication app MS Teams back in November 2016. It was welcomed to the business by Slack with a full-page ad in the New York Times.

In this “open letter” Slack boldly claimed that Microsoft will find it hard to match Slack’s commitment to user success and delight.

And that Slack was here to stay.

In the 4 years since everyone has cheered Slack as the underdog in this battle – it is seen as an independent, brave software company fighting the might of Microsoft on its own.

Back in 2016, Slack had 4 million users. By 2020, it could increase its user base to 12.5 million.

When MS Teams was launched, it was bundled with Microsoft’s Office 365 plan that users had already paid for.

On Day 1, MS Teams had 115 million users.

That’s the essence of this David vs Goliath battle.

When the choice is between slightly better software and a feature-packed bundle with mass distribution – The bundle is likely to win out.

Salesforce acquiring Slack is an attempt to neutralize the massive distribution advantage that Microsoft has.

And leverage the power of bundling.

Popular bundles from the tech giants:

  1. Microsoft Office 365 – MS Office suite + OneDrive + Outlook + Teams.
  2. Google Workspace – All of Microsoft’s offerings + some unique offerings like forms, sites, and Jamboard
  3. Adobe Creative Cloud – 20+ tools for creatives including Photoshop and Illustrator.

Bundles by Startups:

  1. Dropbox – Cloud storage + e-signature + Productivity and Collaboration tools
  2. Superhuman – Fast Email + Gmail’s Addons built from the ground up.
  3. Humble Bundle – Bundling games from indie developers (Sold to IGN)
  4. Notion – Bundles Google docs + Trello + Airtable + Dropbox Paper + Asana


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