Becoming a Customer Company Keynote


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This is the keynote address from the July 17th, 2013 Becoming a Customer Company event. This was a co-sponsored event by Magnet 360,, and Marketo. This presentation includes slides as presented by Peter Coffee, Andy MacMillan, Scott Litman, and Jeremiah Owyang.

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Becoming a Customer Company Keynote

  1. 1. @PeterCoffee
  2. 2. • Old Customers: • Prospects get content from Marketing • Buyers negotiate terms with Sales • Customers raise issues with Support • Connected Customers: • Prospects seek insights from customers • Buyers collaborate on competitor research • Customers tell the world when they’re not happy • Companies need new organizations & processes • Power to address issues pushed to edge of organization • Collaborative response available on demand Customers Today are Connected
  3. 3. Designing in services is now becoming commonplace, making cloud integration expertise critical for manufacturers. •From simplistic services integration on iPhones to the full implementation of voice-activated controls including emergency assistance in the latest luxury cars, adding in services integrated to the cloud is redefining the competitive landscape of industries today. •Revising a product or launching a new product generation with embedded services can mitigate price wars, which is why many manufacturers are pursing this strategy today. TECH 5/06/2013 Products Today are Connected
  4. 4. • Connecting Machines • ‘OnStar’ network daily handles 150k human requests… …and 130k machine-originated requests • Some are critical, e.g. air-bag deployments • Others may be infotainment, e.g. mileage ‘leader board’ • Connecting Processes • General Electric wind-farm management: 123 turbines • Field-wide speed optimization, anti-icing behaviors • 3% output increase → US$1.2M/year added revenue • Connecting People • Asics delivers RFID-triggered messages to marathoners ‘Cloud’ is a Medium of Connection
  5. 5. In This World of Connection… • Everyone who works for you is your brand • Service reps face customers more than salespeople • Customers want to engage in product development: Yes, your engineers may need to be customer-facing • Merely “satisfied” customers aren’t enough • We used to delight a prospect… …and convert to a satisfied customer • Now, brands with merely satisfied customers are invisible • Delighted customers are your only credible marketers • Service interactions are opportunities to re-enchant • Collaboration is crucial to continuous delight • Connected products give manufacturers knowledge of customer behavior • Any team member may need immediate access to subject matter experts • Mentoring, coaching & recognition need to be continuous and non-hierarchical
  6. 6. Connected Companies Win in the Cloud • Customers: records become communities • Employees: appraisals transform to collaborations • Partners: supply chain grows into value network • Financials: transactions evolve to scenarios • Fighter pilot’s “OODA Loop” “Observe, Orient, Decide, Act”
  7. 7. @apmacmillan
  8. 8. /apmacmillan @apmacmillan in/apmacmillan Andy MacMillan Senior Vice President Connect With Your Customers In A Whole New Way
  9. 9. Safe Harbor Safe harbor statement under the Private Securities Litigation Reform Act of 1995: This presentation may contain forward-looking statements that involve risks, uncertainties, and assumptions. If any such uncertainties materialize or if any of the assumptions proves incorrect, the results of, inc. could differ materially from the results expressed or implied by the forward-looking statements we make. All statements other than statements of historical fact could be deemed forward-looking, including any projections of product or service availability, subscriber growth, earnings, revenues, or other financial items and any statements regarding strategies or plans of management for future operations, statements of belief, any statements concerning new, planned, or upgraded services or technology developments and customer contracts or use of our services. The risks and uncertainties referred to above include – but are not limited to – risks associated with developing and delivering new functionality for our service, new products and services, our new business model, our past operating losses, possible fluctuations in our operating results and rate of growth, interruptions or delays in our Web hosting, breach of our security measures, the outcome of any litigation, risks associated with completed and any possible mergers and acquisitions, the immature market in which we operate, our relatively limited operating history, our ability to expand, retain, and motivate our employees and manage our growth, new releases of our service and successful customer deployment, our limited history reselling products, and utilization and selling to larger enterprise customers. Further information on potential factors that could affect the financial results of, inc. is included in our annual report on Form 10-K for the most recent fiscal year and in our quarterly report on Form 10-Q for the most recent fiscal quarter. These documents and others containing important disclosures are available on the SEC Filings section of the Investor Information section of our Web site. Any unreleased services or features referenced in this or other presentations, press releases or public statements are not currently available and may not be delivered on time or at all. Customers who purchase our services should make the purchase decisions based upon features that are currently available., inc. assumes no obligation and does not intend to update these forward-looking statements.
  10. 10. The Customer Revolution
  11. 11. Today’s Platform Connects an “Internet of Things” Terminal Client Devices Products LTE SNA Mainframe LAN/WAN Server Cloud 1,000,000,000s1,000,000s1,000s
  12. 12. The Customer Revolution 1960s Mainframe Computing 1970s Mini Computing 1980s Client Server Computing x 10x 100x 1,000x 10,000x 100,000x 2010s Social Revolution 1990s Cloud Computing 2000s Mobile Computing
  13. 13. Social New ways to connect Trust New ways to build relationships Mobile New ways to reach customers Big Data New ways to discover insight Community New ways to collaborate Apps New ways to build apps Cloud Computing New ways to connect everything New Ways To Connect With Customers
  14. 14. Social Revolution Customer Companies Engage on Social Channels Share Feeds, Profiles, Groups, and Files 4.5 Billion Aggregate Social Users
  15. 15. Touch Revolution Touch & Local Aware Apps Reach Customers Anywhere 1.7 Billion Touch Devices Shipped in 2012
  16. 16. Big Data Revolution Collect Customer, Product and Usage Data Gain Customer Insight 450 Billion Business Transactions / Day by 2020 (IDC)
  17. 17. Community Revolution For Customers, Employees, and Partners Private & Public Communities Single Sign-on with Secure, Portable Identity
  18. 18. Ecosystem Revolution Every Company is Building Mobile Apps Customer Companies Use Apps to Interact with Customers Requires a Customer Platform
  19. 19. Cloud Revolution $111 Billion Industry in 2012 18% YOY Growth #1 Enterprise Cloud Vendor
  20. 20. Cloud Revolution Earn Customer Trust Build Relationships on Equal Terms Respect Privacy, Identity & Money
  21. 21. Companies are Disconnected from their Customers Your Customers, Employees, and Partners are Connected… Is Your Company Connected?
  22. 22. How do you become a customer company?
  23. 23. Become A Customer Company: Connect With Your Customers in a Whole New Way Connected Products Connected Employees Connected Partners Connected Customers
  24. 24. Five Questions To Become a Customer Company: 1. How do you market to customers when they are everywhere? 2. How do you sell as a team with your customers? 3. How do you service customers when they are everywhere? 4. How do you build a customer platform? 5. How do you transform the way you work? Connected Products Connected Partners Connected Employees Connected Customers
  25. 25. @ScottMagnet
  26. 26. OUR MANTRA
  33. 33. “THE ONLY SUSTAINABLE COMPETITIVE ADVANTAGE IS KNOWLEDGE OF AND ENGAGEMENT WITH CUSTOMERS.” -Josh Bernoff, Forrester Analyst Competitive Strategy in the Age of the Customer
  37. 37. @jowyang
  38. 38. Eras of the Internet
  39. 39. What role do corporations play if people don’t need them?
  40. 40. The Collaborative Economy An economic model where ownership and access are shared between people, startups, and corporations.
  41. 41. The only way, is to let go to gain more.
  42. 42. Is this a business disruption?
  43. 43. Sharing Is Not New
  44. 44. Lyft enables crowd to be transportation –avoiding taxis
  45. 45. AirBnb Enables Crowd to be a Hotel
  46. 46. LendingClub enables crowd to be a bank
  47. 47. oDesk enables crowd to be a workforce
  48. 48. Feastly enables your neighbors kitchens to be a restaurant
  49. 49. Liquidspace enables companies to rent from each other
  50. 50. Yerdle leverages Facebook connect to build a trusted network to share products
  51. 51. StokeBox enables collections to be shared for $5.
  52. 52. A properly shared car is $270,000 Lost Revenue Of auto sales (1 shared car = 9 cars at average of $30k each.) 56
  53. 53. Is this a passing fad?
  54. 54. Societal Factors 75% said they predicted sharing of physical objects and spaces will increase in next 5 years –Shareable Magazine Study
  55. 55. Population Economic Factors 1975: 4 Billion 2050: 9 Billion
  56. 56. Technology Factors • 87 phones per 100 people on planet • Three quarters of startups use social tech like Facebook
  57. 57. A movement that’s only increasing Out of 200 collaborative economy startups, total funding was over $2 billion Of those funded, the average was $29 million (May 2013, Lyft raised $60m)
  58. 58. The sharing revolution is an unstoppable movement
  59. 59. Collaborated with the Revolutionaries 64
  60. 60. What can you do?
  61. 61. Collaborative Economy: Value Chain
  62. 62. Collaborative Economy: Value Chain
  63. 63. 1. Company as a Service
  64. 64. Toyota as a Service
  65. 65. Razors as a service
  66. 66. Beauty as a service
  67. 67. Luxury Handbags as a Service
  68. 68. Mobility as a Service
  69. 69. Company as a Service Insights • Companies must offer goods products available on-demand. • Rather than sell a product once –sell it 100 times • To do this, focus on rental, subscriptions, and memberships
  70. 70. Collaborative Economy: Value Chain
  71. 71. 2. Motivate a Market
  72. 72. ScotteVest enables second market
  73. 73. UK retailer M&S fosters Swhoping
  74. 74. Patagonia enabling second market and altruism
  75. 75. Motivate a Marketplace Insights • Companies must enable customers to resell, swap, gift –not hamper it. • Foster a new experience: peer to peer relationships. • Extract value from these new relationships, value added services, or take a cut from transactions.
  76. 76. Collaborative Economy: Value Chain
  77. 77. 3: Provide a Platform
  78. 78. Collaboration
  79. 79. Fund Design Develop Co
  80. 80. Co-Fund new products like Kickstarter
  81. 81. Co-Design products like Nike
  82. 82. Co-Develop like Quirkly
  83. 83. Co-Customize Like Etsy
  84. 84. Co-Production with 3D Printers
  85. 85. Co-Storage of Products with Lockitron
  86. 86. Co-Deliver with Deliv
  87. 87. The Crowd Built a Car: Design, Funding, Production, Assembly, Wikispeed project enabled the crowd to build a 100mpg car
  88. 88. Provide a Platform Insights • Reduce your operating expenses and risk as the crowd gets involved –and generates new value • The highest form of loyalty is co- ownership, as they champion your brand • As the crowd becomes the company, could the evolution of a corporation just retain an ecommerce system and a logo?
  89. 89. Collaborative Economy: Value Chain
  90. 90. What will challenge us as we move forward?
  91. 91. Opposing Market Forces Abound 1. Governments, lobbyists, and institutions oppose 2. Buyers and sellers lack complete trust 3. Fragmented startups in every category 4. Uncertainty about which startups will stand the test of time
  92. 92. What are your benefits for letting go to the collaborative economy?
  93. 93. More efficient, as the crowd helps you 1 2 A long-term relationship with your vested customers 3 New value created between people, means new revenues 4 If you act now, you will have first mover advantage
  94. 94. Collaborative Economy: Value Chain 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20% 20%20%
  95. 95. Collaborative Economy Final Take-Aways • The crowd turns to each other to get goods and services –bypassing corporations • The sharing revolution is an unstoppable movement • Solution: embrace the Collaborative Economy Value Chain: 1. Company as a Service 2. Motivate a Marketplace 3. Provide a Platform
  96. 96. Let go of your company to gain the market.
  97. 97. What side of history will you be on?
  98. 98. Download Report: Jeremiah Owyang Partner and Industry Analyst Altimeter Group @jowyang
  99. 99. Collaborative Economy Glossary Collaborative Economy (Model): An Economic model where ownership and access is shared between people, startups, and corporations. Two sided Marketplace (Category): An online website where buyers and sellers of goods or services are sharing inventory, need, and transacting. Example: Ebay, Craigslist, AirBnb, 99 dresses. Transactions (Verbs): There are many types of verbs that can be used in facilitation including: Buy, Sell, Swap, Lend, Gift, Co-own, co-fund , buy and more. Maker Movement (Trend): An emerging trend where customers can self-design, create, produce, and distribute products and goods on their own. Company as a Service (Strategy): Rather than sell goods in the traditional sense, offer products or services to customers on- demand or through a subscription model. Rent, Subscribe, or Gift. Motivate a Marketplace (Strategy): A community around a brand enabling customers and partners to resell or co-purchase products, swap goods related to the brand, or even enable lending or gifting for no monetary exchange. Provide a Platform (Strategy): Corporations that enable an ecosystem customers to build products and new services as partners — not just consumers. Online Reputation (Feature): Any number of online features that store historical and current information about social profiles, individuals network connections, credibility, or reviews of previous and predictable behavior. Social Sign On (Feature): A technology feature that connects websites with profile systems from social networks like Facebook, LinkedIn or Twitter connect enabling existing reputation, social contacts, and social graph information
  100. 100. Credits: Research Interviews Airbnb, Molly Turner, Public Policy Arbor Advisors, Dean Callas, Investment Banker Ariba, An SAP Company, Joseph Fox, VP of Strategy August Capital, David Hornik, Investor Bazaarvoice, Stephen Collins, CEO carpooling .com, Markus Barnikel, CEO Cisco, Carlos Dominguez, SVP, Office of the COB and CEO ConnectMe 360, Brian Hayashi, Founder, Shauna Causey, VP, Marketing Enterprise Holdings, Ryan Johnson, WeCar AVPeToro, Yoni Assia, CEO and Founder eToro, Nadav Avidan, PR and Communications Manager eToro, Adi Yagil, Head of Social Media Gazelle, Israel Ganot, CEO HomeExchange, Ed Kushins, Founder Jive Software, Christopher Morace, Chief Strategy Officer LiquidSpace, Mark Gilbreath, CEO/Founder/Skipper Lithium, Rob Tarkoff, President and CEO Lyft, Kristin Sverchek, General Counsel MuckerLab, William Hsu, Co- Founder, Partner Sasson Capital, Vivian Wang, Venture Capitalist oDesk, Gary Swart, CEO oDesk, Shoshana Deutschkron, Director, Communications OuiShare, Antonin Léonard, Co-Founder, Gene Chuang, CTO PivotDesk, Alex Newman, Director, Customer Development and, Min Chan, GM of Mobile SCOTTEVEST, Scott Jordan, CEO and Founder Shareable Magazine, Neal Gorenflo, Founder Shasta Ventures, Rob Coneybeer, Managing Director Collaborative Lab, April Rinne, Chief Strategy Officer Collaborative Lab, Lauren Anderson, Chief Knowledge Officer The Mesh, Lisa Gansky, Author, The Mesh: Why the Future of Business is Sharing Zuora, Tien Tzuo, CEO Zuora, Brian Bell, CMO Deborah Schultz, Innovation Strategist
  101. 101. The following people provided guidance, reviewed content, tested ideas, or most importantly, challenged the thesis during the project: David Armano, David Berkowitz, Richard Binhammer, Mel Blake, Erik Boles, Michael Brito, Noelle Chun, Steve Farnsworth, Lyle Fong, Ian Greenleigh, Shel Holtz, Noah Karesh, Kevin Kelley, Matt Krebsbach, Wendy Lea, Evelyn Lee, Geoff Livingston, Jacob Miller, Marcus Nelson, Ben Parr, Jeff Richards, Andy Ruben, Jim Rudden, Ben Smith, Aaron Strout, Carmen Taran, Rob Tarkoff, Ed Van Siclen, Mike Walsh, Sharon Weinbar, Adam Werbach, Susan Williams, Vladimir Mirkovic, Anita Wong, and the entire Altimeter Group research and consulting team. We extend special appreciation to LeWeb founder Loic Le Meur who inspired Altimeter Group to research this topic. Credits: Research Input
  102. 102. Peter coffee
  103. 103. • If the cloud is only used to modernize IT, that’s all that will happen – and it will not be enough • Enormous improvement of connection enables mobile as the norm; desk work as exception • Mobile access enables in-the-moment inquiry and action via networks of trusted advisors – some call them ‘social’ • Machines, as well as people, are connected – and even machines can be ‘social’ in key behaviors • Decades of design have focused on documents • Future of IT is in workflows. We call it “the feed.” ‘Cloud’ Must Mean More Than ‘Cheap IT’
  104. 104. “What You See Is What You Get”? “What You See Is What You Need” • What you’re doing • Who else is doing it • What’s already been done • What you want to share • What you want to show • What you want to ask
  105. 105. Connected Computing Leaves the Desk Behind • “Desktop metaphor” is 25 years old • Xerox… • Apple… • Microsoft… …but today, 1/3 of U.S. adults own at least one tablet… …and usually don’t use it at a desk
  106. 106. It’s Time to Make the Customer the Focus • 1st -generation computer: enter code with switches • Think about memory and storage • 1st -gen operating system: “Load my program” • 2nd -generation computer: command-line window • Think about programs and files • 2nd -generation OS: “EDIT MY_FILE” • 3rd -generation computer: desktop metaphor • Think about ‘documents’ like spreadsheets • 3rd -generation OS: double-click an icon • It’s time for the next generation • A platform whose focus is…customers
  107. 107. @jowyang @PeterCoffee @apmacmillan @ScottMagnet