Slack uses Stripe to process payments and achieve 99% authorization rate

Slack is an all-in-one productivity platform with tools that help teams collaborate, automate tasks, and share and manage files. Slack users send over one billion messages every week via its channel-based messaging solution.

Products used

    Invoicing
    Data Pipeline
Global
Enterprise

Challenge

Slack released its popular messaging platform in 2014, and today it’s nearly ubiquitous in the modern workplace. Over 75 companies in the Fortune 100 use Slack Connect, and for many knowledge workers, the ping of an active Slack channel is more familiar than the sound of their own doorbell.

Early in Slack’s history, company leaders recognized that payments were mission critical but often fraught with complexity. And over the years, as Slack rapidly expanded to serve large-scale enterprises, managing billing and adding new payment capabilities presented involved challenges.

For example, to generate invoices, Slack relied on manual processes that were time consuming and prone to error. Slack also needed to simplify its checkout flow and eliminate unnecessary steps that invited errors and weighed on conversion and authentication rates. Plus the company wanted the ability to add new payment methods and launch new payment features without heavy technical lifting.

Finally, Slack needed ongoing support to keep its developers focused on core competencies rather than spending valuable resources on stop-gap fixes to its internal billing system.

Solution

Slack determined that by partnering with Stripe, which it runs on AWS, it could build the enterprise payment experience its customers required without compromising other priorities. Initially, Slack deployed Stripe Payments to enable ACH and credit card payments. From there, Slack and Stripe continued to partner closely, addressing challenges as they emerged and as Slack’s business grew exponentially.

One of the most important Stripe products for Slack was Stripe Invoicing, which enabled Slack to automatically issue invoices and reconcile incoming payments with their associated invoices. With Invoicing, Slack can now automate tasks involved with the subscription lifecycle—including creating new invoices, finalizing invoices, collecting payments, sending customer emails for failed payments, and sending the customer status updates throughout the process.

For deeper data insights, analytics, and reporting, Slack implemented Stripe Sigma. Slack used Sigma to dig into transaction data and track revenue metrics, identify trends, and troubleshoot potential problems.

To make its checkout flow easy and intuitive, Slack used Stripe’s optimized checkout suite—which includes prebuilt UI components such as the Payment Element to quickly add new payment methods without code—and the Address Element to autofill a customer’s billing details. Slack also used Payments features such as the card account updater—which helps reduce churn by automatically retrieving the latest information for expired cards—and Adaptive Acceptance, which selectively retries declined payments in real time.

Slack used these tools to eliminate unnecessary lines in its checkout form and add inline verifications to help reduce user errors. Slack also added a button that allows customers to autosave their payment information. Together, these optimizations now help improve Slack’s customer experience, drive conversion, and increase authorization rates.

For ongoing support, Slack opted to use Stripe’s Enterprise Support plan, which enabled frequent contact and close collaboration to track ongoing initiatives, quickly resolve issues, and engage in monthly strategy sessions to delve into longer-term goals. This support ensured successful implementation and continuous improvements emerging from workshops on optimizing authorization rates and local payment methods, and teardown sessions on Slack’s checkout. The Stripe team used these sessions to help Slack get the most from its integration.

“The support and great relationship we have with the Stripe team is something we highly value and allows us to be more agile and integrated with Stripe,” said Bradley Bortner, a product manager on the Slack expansion team. “Ultimately, this close relationship helps us drive productivity and innovation.”

Results

Slack saves time and reduces errors with automated invoices

Implementing Payments and Invoicing enabled Slack to offer its customers an easy way to set up their automated payments without needing to contact Slack’s customer experience team. And as a customer’s Slack use grows, if their renewal payment exceeds the limit for credit card payments, they can seamlessly switch to a different payment method without interrupting their service.

By automating payment and invoicing workflows, Slack has also recovered significant work hours and reduced errors resulting from manual processes.

Simple checkout flow boosts conversion and keeps authorization rates high

The steps Slack took to optimize its checkout flow have reduced friction and improved the customer experience, resulting in a quick, simple checkout process. Stripe solutions, such as the card account updater and Adaptive Acceptance, have helped reduce card declines and payment issues. And with the Payment Element, Slack can now quickly add new payment methods as soon as they become available. Together these checkout refinements have led to higher conversion and authorization rates of 99% in the US.

Stripe Enterprise Support introduces one-page checkout, leading to 3.1% lift in conversion

The Enterprise Support plan was key to the success of Slack’s Stripe integration, providing streamlined communication, quick response time, and insights that helped Slack find new ways to further optimize its payment flow. One initiative that resulted from a checkout teardown session was replacing Slack’s two-page checkout experience with a one-page checkout. The implementation of a shorter checkout page using the Payment Element and the Address Element led to a 3.1% increase in conversion to a paid plan.

Slack continues to work with Stripe to introduce new payment capabilities, scale new payment methods, and prioritize key markets and payment methods that will help drive Slack’s expansion and growth.

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