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Microsoft Teams vs. Slack: What’s the Difference?

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Microsoft Teams vs Slack is a debate that has been running non-stop online. However, the crux of the debate is a moot point, because the two rivals aren’t actually competing for the same customers.

A lot of these articles that pit Microsoft Teams vs Slack closely compare the two applications. They compare functionality, features, and practical uses. While it is true that both of these programs offer online team-based collaboration tools. They do have similar functionalities. However, they aim to address very different segments of workers.

Particularly, comparisons are drawn to liken the more newly released Microsoft Teams to its predecessor. Slack has revolutionized the way teams work. When Microsoft Teams was released, Slack may have felt that its position in the online communication market could be threatened.

In fact, the Microsoft Teams vs. Slack rivalry has also been fuelled by Slack itself. The marketing and PR people behind Slack took out a full-page ad in the New York Times to “welcome” Microsoft to the online collaboration space. This shows that they are insecure about the presence of Microsoft Teams in their sandbox. Through their actions, they have also firmly reaffirmed their position as the underdog or disruptor in the industry.

However, as we will see, the sandbox is in fact getting larger. And although there is no harm in a bit of competitive spirit, there is no reason for Slack to worry about losing customers to Microsoft Teams. There is enough demand to make room for new solutions.

Product vs. Feature Difference

According to a great article published on ZDnet, Slack is a product and Microsoft Teams is a feature. This distinction is crucial to the Microsoft Teams vs Slack debate.

At the forefront, Slack is a product because it is standalone. Companies acquire Slack to answer a specific need. It solves one direct business issue. Although it has many potential add-on features, the main objective of Slack is to be an office-messaging app that replaces email.

Meanwhile, Microsoft Teams is a part of the larger Microsoft Office offering. It does respond to the same need for office communication and team collaboration. However, it’s only one feature of the Office Suite, and it does not come as a stand-alone product. Moreover, it offers built-in integrations with all of the other Microsoft tools.

Microsoft Office and Office 365 have been the hallmark of traditional business tools for decades. Traditionally, enterprise applications have been difficult to implement and have not been the most innovative. Nevertheless, enterprise applications are evolving.

Indeed, Microsoft is leading that change. They have come to see that every company out there has to select the tools that will power its business. While a lot of more traditional organizations turn to Microsoft Office by default, Microsoft wants to stay competitive in a shifting market.

That being said, Microsoft remains an enterprise solution. Therefore, Teams remain a feature of a larger array of solutions. Organizations that are looking to avoid getting involved with a suite of applications will still turn to Slack.

Different Target Markets

One main difference between these two applications is their users. When they took out their ad in the New York Times, Slack may have been under the impression that they will be directly competing with Microsoft Teams.

This has proven untrue, or rather not completely accurate for two good reasons. First of all, Slack’s ability to allow users outside of an organization to participate on the platform is a key differentiator. This feature is perfect for companies that have a looser structure. Perhaps it is also best suited for companies with a lot of contractors, and remote workers. Simply put, it’s just more functional for a conglomeration of random individuals, who nevertheless need some form of structure to collaborate. This type of group does not need, or cannot afford a full-scale enterprise system.

Microsoft Teams, as part of the Office 365 solution, doesn’t allow users outside of an organization to participate. Therefore, it is better suited for more traditional companies. That is, it is positioning itself to be the collaboration tool for set teams within an organization. For instance, these teams could be project teams within a structured organization. All of the recourses of this organization are in-house. They do not, therefore, need to interact with anyone outside of their organization.

Microsoft Teams is the right tool for this second type of team. In fact, it’s very likely that this type of organization already uses the Office Suite.

The Cost Difference

When discussing the Microsoft Teams vs. Slack debate, it’s important to consider the cost difference. The price tag can definitely influence a new client that is considering adopting one of these tools.

Slack makes its free tier very easy to sign up for. It offers a freemium model for small clients, or for new start-ups. It’s one way that Slack really ensures that start-ups remain a part of their user base.

Despite offering the freemium option, Slack estimates that it has over one million paying customers. On the one hand, users on the freemium plan total over 4 million users. Yet on average, paying Slack customers spend between 80$ and 150$ per user per year.

On the other hand, an Office 365 Business subscription costs 60$ per year for the Business Premium tier. Yet, this also is not exactly a one-stop shop. Sure, it is integrated with Outlook, OneDrive, and other must-have tools from the Office Suite. However, it still lacks the personality of Slack.

Yet, this may not be a big hurdle for Teams. Since it is an Office 365 feature, Microsoft Teams already has access to the 85 million commercial customers that run on the Microsoft Office Suite daily. For these customers, the cost is already a non-issue. Microsoft Teams is just a bonus feature that they now have access to.

Adding Integrations To Your Collaboration Tools

However, in both cases, the base price can go up quickly when you start adding various integrations. And let’s face it: for Slack to truly work for a team, the right integrations are crucial. And although it is a feature of a system many companies already pay for, the same can be said for Microsoft Teams. Integrations help to automate simple processes, like task management, document storage, or even vacation tracking. These apps are added on to Slack to get even more efficiencies from the collaboration tool. There are more than 1,800 apps available for Slack at this time. And this number just keeps growing!

Nevertheless, there are integrations for Microsoft Teams that have been developed as well, and more that are being created as we write this article. These come at an additional cost, just like Slack integrations.

Microsoft Teams vs. Slack: Final Words

This time last year, 13 million people were using Microsoft Teams. Since then, this number has only been increasing. Should Slack be worried?

Not exactly.

Indeed, Stewart Butterfield, Slack’s founder and CEO himself, dismissed the growth of Microsoft Teams stating publicly “I don’t think that’s really a threat”.

As we have seen, these two applications, although comparable in terms of features, are still attracting different markets. They have differences in terms of pricing. Finally, one is a product, and the other a feature.

Hence, maybe M. Butterfield is right. The Microsoft Teams vs. Slack debate will not be resolved today, but suffice it to say that there is enough room in the market for both.

Microsoft Teams vs. Slack: What’s the Difference?

Kristina Ousmanova
Kristina Ousmanova

Kristina recently left behind fast-paced life of Human Resource Business Consulting to freelance as a Content Writer. A regular Vacation Tracker contributor, she can be found working remotely from her home in Montreal, usually while eating a variety of snacks.

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