What is the most important metric for Slack and why?
+4 votes
in Metrics by (717 points) | 3.1k views

5 Answers

+4 votes

Slack is primarily a Saas company. Slack makes money by annual recurring revenue. Just to clarify, Slack is more than just a chat app. There are tons of applications you can integrate it with, for example, project management software with Trello. This could also be something to consider.

The goal of Slack is to empower teams and companies with productivity. As a user of Slack, you would be able to do all work-related things like chat, project management, analytics, etc with Slack.

The most important metric, in my opinion, is Churn. Retaining customers is extremely important for Slack, especially with all the upcoming competitions like HipChat and other companies like Google, Facebook trying to get into the business suite (B2B SaaS) industry. Churn allows the product team to learn from its customers the best (to understand why they left) – as opposed to asking satisfied current customers

You can create a funnel to see where the Churn occurred (for example, many users in a specific company could sign up for a Slack account, but not create any channels, and such, low usage due to issues leading to cancellations).

Digging deeper, you can look at a number of topics and threads being created, how engaged or active users were at certain points to pinpoint specific problems.

The problem with Slack as a user is a usage – if no one uses it, companies will not see the point of purchasing the subscription plan. Companies have to see the value from their employees and this means active chatrooms, threads, and some sort of result. Slack could definitely measure this individually and potentially quantify it by segmenting based on Slack-Successful companies VS non-Slack-successful companies.

And just to emphasize, monitoring customer satisfaction as a metric should be the next step. Go visit and speak to the customers to understand what issues they might be having.

Anyway, looking at churn rates on a monthly basis, and trying to reduce it with a set goal % should be an important aspect as a PM at Slack. This will lead to creating something sustainable – and afterward, we can focus on other things like CPA, ARPR, LTV, MRR, ARR.

I would end the note by saying enterprise Saas is tougher to analyze – a single metric should never be considered the most “important” because it all depends on context. For example, Slack could be focusing on retaining big enterprises as a business and could care less about churn from smaller companies. Churn rate % could help evaluate the current product and that should be important for a PM.

See less
I would also add that the conversion rate from non paid to paid subscription is an important metric to watch.
Very good answer. I liked two points especially.

1. You mentioned compeititon as a constat threat.

2. You think of segmenting users and seeing what is different between churn vs non-churn segments.

3. You mention that we are not caring equally about all segements and we do not want to invest equally for each segment.
+2 votes


Business: Going public soon.

Mission: Continue to be 'where work happens'.

What is Slack?

Workplace messaging app primarily. But also used for larger communities (e.g. Product Manager HQ has tens of thousands of members).

Users can send and view messages grouped by channel in a 'workspace'. They access it through web, desktop and native mobile apps. Third party companies and users can interact with workspaces through the Slack API/Platform.

The unique value users get from Slack is:

  • They receive information about their work
  • It's relevant to them
  • It's presented in a delightful way
  • It's all in one place

It achieves these things by:

  • Making messaging between people faster than email
  • Designing a delightful interface that helps users do what they want and enjoy the process
  • Incorporating integrations through the API

Who are Slack's users?


  • Not for Profits (charity, local organisation)
  • Communities (online community of product managers, designers, campaigners)
  • Startups/SMEs
  • Large businesses
  • Multinationals

We also need to consider Slack's partners:

  • Businesses with Slack integrations
  • Businesses built on top of Slack

How does Slack make money?

Tiered pricing:

  • Free: limited storage history but unlimited users (and channels, I believe) - used by Communities and Not for Profits
  • Paid teams: extended/unlimited storage and other features like external channels - used by Startups/SMEs and teams within Large Businesses
  • Enterprise: connections between Slack teams - used by teams within Large businesses and Multinationals

Deciding the metric

For Slack, we could consider the following metrics:

Product metrics:

  • Usage (messages sent, time on Slack, messages viewed, channels joined, integrations added)
  • Feedback (NPS etc.)
  • Growth (either by workspace or users net growth, retention, churn)

Business metrics:

  • Market share
  • Number of paid customers

Assessing the metrics:

Criteria for assessing metrics

  • Easy to calculate and act on
  • Good for the product by incentivising behaviour that enhances its value
  • Good for investors by increasing and explaining the value of the business

Usage (messages sent, time on Slack, messages viewed, channels joined, integrations added)

  • Messages sent is an obvious starting point. Perhaps that can be refined to something like number of batches of messages sent per day to reflect conversations. This is the core Slack functionality.
  • Perhaps it's too narrow and doesn't reflect the unique value of Slack, differentiating it from a pure messaging app like WhatsApp. So maybe a combination with messages, channels and integrations will help. But then the metric becomes harder to interpret.

Feedback (NPS etc.)

  • This is a strong candidate since it reflects how much people enjoy the product. This is important to Slack since it's enterprise software that people enjoy, differentiating it from the legacy providers that they hate to use.
  • But again this is generic. It doesn't reflect what its users are trying to achieve. Slack isn't like Reddit or Twitter, which are just for enjoyment.

Growth (either by workspace or users net growth, retention, churn)

  • The benefit of setting growth as the target is that it is simple. Another is that it's historically been the result of good product, since people tell other people about products they enjoy, and continue to use them.
  • A limitation is that it doesn't express how people are using the service. Increased acquisition can just be a result of greater brand awareness. Good retention is not exclusive to good products - sometimes it's just lock-in. Now that Slack is a more mature company, growth might not be as good a guide as it was.

Market share (by customer segment)

  • Slack's market share is arguably more important the larger it grows. If it's becoming a public company then it will be important to look for global rather than local maximums. In the context of Microsoft and Facebook's competitor products then this will be important in the long term.
  • This can be harder to calculate than other metrics. Whether an online community counts as part of the market is a difficult question.

Revenue (per workspace, per user, absolute)

  • An advantage of this will be that it helps the company prove profitability to investors when it floats.
  • It has the disadvantage of incentivising local maximums which harm the business long term. In particular, increasing prices or limiting more features to paid tiers (worse still, micro transactions) might hurt brand image in the long term.


Since Slack is going public soon it will be important to focus at least for now on attractiveness to investors. Therefore product-level metrics might need to take a back seat to business level metrics. Of these, market share is less easy to calculate but less likely to lead to harmful product practices.

Therefore market share seems like the best metric to use. It's likely that it will be made simpler to calculate and act on if it's limited to established startups, office-based SMEs and all larger businesses.


  • Slack's core value to users is delightfully providing one place where they can see and send information about work. It's going public soon so that's important to business leadership.
  • When deciding between metrics it will be important to consider how easy to calculate the metric is, how easy it is to act on and what the effect will be on the product and investors.
  • Share of the total addressable market was chosen because it was less likely to harm core product value, and reacts to the IPO and competitor context.
See less
by (26 points)
I like your overall structure but I would have picked a different goal. We're being interviewed for a PM role and it's hard to directly improve market share as a PM as there are so many factors that impact market share (pricing, location, marketing, etc).
 I would have picked something that's easier to impact. I think the goal should be something similar to "increase engagement" since an increase in engagement will result in increase in market share, improve retention, increase revenue, etc in the long run. Then I would pick a set of metrics that I can have direct impact on.
- # of messages posted each per day
- # of plugins used per workspace
- # of active workspaces
These are metrics we as PM's can have direct impact on.
+2 votes

Goals for slack in ranked order 

1. Intra team engagement (Reason: The main marketing of slack is that best teams use slack or most productive teams use slack)

2. Inter team collaboration (This is super important to ensure that slack does not breed creating of siloes, which is the main problem of defacto incumbent aka the email)

3. 1:1 communication (There should be no reason that just by having slack 1:1 communication should suffer)

Some metrics ranked in order:

A. average no. of messages per team per week (MOST important since it measures team engagement)

B. No. of active channels per week (are all teams using slack well - adoption/retention/engagement) 

C. No. of new channels created per week (is slack fostering new conversations between people - engagement)

D. No. of new people added to a channel per week  (this is important to ensure that information is being diffused and there is collaboration)

E. No. of active 1:1 conversations between people who are part of common channels (should be higher than E, meaning people who are part of common channels have broken the ice and are chatting more than people who are not yet part of common channels. Also as a baseline this number should ideally be higher than the pre-slack communication stack e.g. should be more than 1:1 emails)

F No. of fresh 1:1 conversations started between people who are not connected via any existing channels (indicates how slack helps break barriers between two people in an enterprise)

See less
by (69 points)
0 votes

Slack is a communication platform used in companies and common interest groups to exchange messages and files. One can communicate 1-on-1 or within a group. Depending on the usage i.e. # of messages or # of people in group, one can use free or paid version of slack.

For a product like this, there are several metric one would look at depending on the goal.
1. # of users to measure how many people enjoy using Slack
2. # of messages sent per user or time spent per session to measure user engagement with Slack
3. # of features a user uses to measure how much involved a user is with Slack
4. churn or time taken in any process flow before drop out to measure if slack is meeting user expectations
5. NPS to measure overall satisfaction

So to pick the most important metric, we would need to identify what would be the most important goal for slack. Since slack is a subscription based, no-ads and for-profit product, I would assume $ from subscription is the only source of revenue. For a company to run in a self-sustainable way, revenue or the amount of money it makes is an important metrict to look at.

Moreover, users would pay subscription fee only if they really like the product and use it frequently. So # of subscriptions which is the primary source of revenue is a good enough proxy for the success of product.

In summary, even though no one metric can measure the success of product fully and metrics change depending on the goal, if I have to pick only one metric, I would say # of subscriptions is the most important metric.

See less
–2 votes

Slack is mostly used in enterprise communication. I assume among developers and teams.Metrics could be number of users logged in, number of messages, number of premium users, number of free, new users, growing…See more

Your name to display (optional):
Privacy: Your email address will only be used for sending these notifications.
To avoid this verification in future, please log in or register.
Your name to display (optional):
Privacy: Your email address will only be used for sending these notifications.
To avoid this verification in future, please log in or register.

Related questions