How Social Media is Transforming Customer Service and the Customer Experience

How Social Media isNatalie Petouhoff,Senior Analyst,Forrester Research Transforming Customer ServiceGary McNeil,Vice President, Marketing,Parature Inc. and the Customer Experience

OUR BUSINESS Parature is a global leader in on-demand software (SaaS) for customer service and support Parature enables organizations to: • Reduce the cost of supporting their customers • Have a 360 view of customer issues • Retain their customers • Improve customer loyalty • Generate more revenue from their base • Deliver “great” customer service

PARATURE - ONE INTEGRATED SUITE• One stop shopping• One integrated software suite – on-demand • Parature Portal • Parature Ticket • Parature Knowledgebase • Parature Reporting • Parature Chat • Parature Forum • Host of other modules“With Parature, we do not have to increase our CSR headcount…we would have needed two tothree additional CSR‟s with the rate that JobFox is growing.” - JobFox

PARATURE REDUCES SUPPORT COSTS BY 5X $40 $36.24 Cost per transaction $35 $30 $25 $25 $20 $15 $7.94 $10 $5 $0 Phone Email Self Service Support*A survey published by the Association of Support Professionals compares the high cost of phone support to email and web self-servicesupport.

CONSISTENT TRACK RECORD, QUARTER OVER QUARTER 27 Quarters of Growth, 750 Customers and High Retention Rates 800 700 600 500 400 300 200 100 0 Q3 2002 Q1 2003 Q3 2003 Q1 2004 Q3 2004 Q1 2005 Q3 2005 Q1 2006 Q3 2006 Q1 2007 Q3 2007 Q1 2008 Q3 2008 Q1 2009 “ I love your product and will be more than happy to do a case study and press release for you. A few months ago, I thought I had to hire more CustomerSupport Reps, but now my reps are asking for more work because your product has reduced much of the workload.” - Victor Pitts, VP Support, Moniker

800 CUSTOMERS ACROSS INDUSTRIES & MARKET SEGMENTSTechnology Business Services Gaming and Digital MediaEducation Associations Healthcare

MACRO TRENDS ON CUSTOMER SERVICE AND SUPPORT • Support Channel preferences are radically changing with each generation • New technology trends can impact customer service behavior • Understand who your target customer is and how they prefer to be supported • A new generation of Service Desk Agents embracing newer technology Source: SSPA and Wikipedia, 2007

SOCIAL MEDIA AND NEXT GENERATION CUSTOMER SERVICE• Customers want many social media service options: • Log a chat session with a quick question • Go to a forum to have another customer help them with their answer • Deliver instant feedback on your customer interaction • Customer service via iPhone• Post a tweet on Twitter • Organizations are forced to act on social media interactions from their customers • Sometimes it is a customer who is venting about a product or service • Responses to the customer tweet are warranted and in many cases necessary

KEY CHAT CAPABILITIES 16 Issue Summary Priority 2 Toolkit5 My Chats List 4 Toolbar 3 Shortcuts

IN-GAME CHAT SUPPORT (XMPP)

NEW TWITTER INTEGRATION Monitor What Your Customers are Tweeting About Your Business• Help companies search the millions of „tweets‟ to find relevant conversations• Capture the conversation by creating a new ticket that tracks the original „tweet‟ & enables easy response Capture and monitor “tweets” about what others are saying about your• Easily funnel relevant solutions from business or service experience. your knowledgebase into a „tweet‟• Create reports to analyze how many Measure Twitter Traffic Versus Other Support Channels in tickets are being generated from Real-time. „tweets‟

How Social Media is Transforming Customer Service and the Customer Experience Natalie L. Petouhoff Senior Analyst Forrester Research June 24th, 200915 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Agenda • Creating branded customer experiences is critical to a company‟s success • But companies are not providing good customer experiences – customers are disappointed • Social Media is the key to transforming customer service and the customer experience16 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Only 45% of customers were satisfied with agent phone service Source: March 31, 2008, “How Consumers Research, Buy, And Get Service” report.22 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Dissatisfaction is related to… • Agent phone service • Incorrect problem diagnosis • Incomplete or contradictory answers • Having to repeat information already provide via key pad or saying it to an agent… • Number of transfers to “experts” • Agent attitude23 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

What is social media and Web 2.0? • Groundswell: A social trend in which people use technologies to get the things they need from each other, rather than from traditional institutions like corporations. • Web 2.0: A set of applications enabling efficient interaction among people, content, and data to collectively fostering new business practices and social structures. • Social media: Blending Web 2.0 tactics with customer service to engage with customer communities and draw value from social interaction.26 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

What is social media for customer service? • It‟s… » Twitter » Online communities- Lithium, Helpstream, Jive… » Facebook, LinkedIn, MySpace » RightNow, Parature and nGenera • It‟s not just a… » Forum » A wiki » A blog… • It‟s a community that interacts with each other on an ongoing basis27 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Today’s topic… • Online customer service communities » The 90:9:1 mix of communities – Customers post questions – 90% read the answers – 9% post answers – 1% (Super users) post most of the answers – What isn‟t answered by other customers, super users or community manager, gets answered by contact center agents29 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

What is a Customer Service Online Community? • Online communities have evolved from “bulletin boards” •Today they are “posts” in the form of forums, blogs, and chats. • Updated “posts” sent via email or RSS syndication subscriptions • This instantly distribute new information to EVERYONE Source: January 21, 2008, “The Economic Necessity Of Customer Service” Forrester report36 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

TEI™ is Forrester’s ROI methodologyBenefits Benefits • Quantified value • Defined metrics (Impact on business) R Total Economic Cost Costs I Impact • People • Process (Impact on budget) S • Technology Flexibility K (Options) “Options” created Uncertainty • Are there new opportunities the future? • Impact of “assumptions” Source: August 4, 2008, “The Total Economic Impact™ Methodology: A Foundation For Sound Technology Investments” Forrester report 37 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Assumptions• Multiple customer service goals• Small to medium sized call center• Three year time frame for analysis• Federated search• Allows agents to have access to the • Attracts super userscommunity • Engages community to be• Has federated search honest about their opinions • Company is interested in community‟s opinions… Source: May, 2009 “The ROI of Online Customer Service Communities” Forrester report 38 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Examples of benefits • Cost savings • Reduce call volume • Reduce email volume • Increase agent productivity • Increase in FCR • Reduce SEO costs Benefits (Impact on business) • Revenue improvements – Increase customer lifetime value – Increase product ideation – Increase lead conversion rates Source: May, 2009 “The ROI of Online Customer Service Communities” Forrester report39 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

There are many benefits of Customer Service OnlineCommunities… Source: May, 2009 “The ROI of Online Customer Service Communities” Forrester report40 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

The answers are in the community• Customers solve each other‟s problems• Less or no interaction from a company. • Customers read posts • Fewer call to the contact center• And agents use the community-enhanced KMdatabase • Reduces their call time • Provides more satisfying answers. Source: January 21, 2008, “The Economic Necessity Of Customer Service” Forrester report 41 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

First Contact Resolution (FCR) goes up• FCR affects • Customer satisfaction • Purchase reprobability • Good word of mouth… My question was answered !!!!!!!! Source: January 21, 2008, “The Economic Necessity Of Customer Service” Forrester report 42 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

What happens when there’s “bad word of mouth?” • Do the “ostrich” or… • Handle it… • Alert executives • Quickly post a resolution to the community • Avoid • Brand damage and • Increased call volume… Source: May, 2009 “The ROI of Online Customer Service Communities” Forrester report 44 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Invest in turning customer informants • Even informants can be turned into advocates: • Use a built-in system to recognize, rank, and reward users • Acknowledge their suggestions • Thank them for helping customers Source: May, 2009 “The ROI of Online Customer Service Communities” Forrester report45 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

What about the rest of the company?•Product Development •New ideas coming from communities can save product development millions•Product Q&A •Get solutions that can‟t be found any other way•Marketing and Sales •Now promoting a product that was designed with customer input. Source: January 21, 2008, “The Economic Necessity Of Customer Service” Forrester report 46 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

The benefits of customer service online communities… Source: May, 2009 “The ROI of Online Customer Service Communities” Forrester report47 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Examples of customer service online community costs • People – Training – Staff • Process – Marketing of community • Technology – Community website design Costs (Impact on budget) – Single Sign-on – Integration to contact center – Platform subscription fee – Analytics – Reporting48 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Start-up costs of customer service online communities… Source: May, 2009 “The ROI of Online Customer Service Communities” Forrester report49 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Recurring costs of customer service online communities… Source: May, 2009 “The ROI of Online Customer Service Communities” Forrester report50 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

The ROI of online customer service community is… Source: May, 2009 “The ROI of Online Customer Service Communities” Forrester report 51 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

The TEI of online customer service community is… Source: May, 2009 “The ROI of Online Customer Service Communities” Forrester report 52 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Be proactive about chat • Companies spend billions annually for their Internet presence • The investment is wasted their investment as customers abandon shopping carts mid-order, click away from partially filled forms, or become frustrated when they can‟t find answers. •Proactive chat has a large return on investment and provide millions of dollars in positive word of mouth Source: January 21, 2008, “The Economic Necessity Of Customer Service” Forrester report53 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

What the primary research shows… Web chat is important!Source: August 2007 “Why Financial Shoppers Abandon Online Product Applications” report.54 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Design considerations for chat make a big difference… Source: March 11 2008, “Improving The Design Of Chat Interactions” Forrester report58 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Look at providing ways to create consistency across channels… Source: March 11 2008, “Improving The Design Of Chat Interactions” Forrester report59 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

What you can do -- strategy best practices Define you customer experience brand…. »The sum of a customer’s experience overtime »Strategic management of customer touch-points »Reflects your customer’s identities, needs, wants…61 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

What you can do -- strategy best practices-- Design experiences to create feelingsthat emotionally engage customers… What Are UDesigning?62 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Where to begin? • Take the self-assessment • Evaluate your organization • Compare to best practices • Get alignmentSource: January 13, 2009, “Forrester Customer Service Innovation Framework and Self-Assessment ” Forrester report63 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Evaluate customer serviceSource: January 13, 2009, “Forrester Customer Service Innovation Framework and Self-Assessment ” Forrester report64 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Assess your customer capabilities against: customer service knowledge base best practices August 2007 “Forrester’s Best Practices Framework For CRM”66 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Compare your scores to best practices 2.28 2.00 2.7 2.20 2.03 2.18 Source: January 10, 2008 “Customer Service Best Practices Adoption” report 67 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

Customer experiences create your brand • Great customer experiences create loyal customers • Loyal customers create brand equity • Brand equity creates growth, revenue and profits68 Entire contents © 2008 Forrester Research, Inc. All rights reserved.

QUESTIONS? Follow Parature on: blog.parature.com www.facebook.com/parature www.twitter.com/parature www.youtube.com/paratureinc www.slidesharenet.net/parature www.parature.com/rss

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How Social Media is Transforming Customer Service and the Customer Experience

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