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Social really is here when it comes to the enterprise. Many see the role of social in consumer-focused businesses but have not absorbed what it means for the enterprise. Social is having a direct impact in 5 areas:
1. DIY prospecting: Customers conduct research on products and services well ahead of the official start to the sales cycle
2. Peer influence: Customers “pulse” their peers at every step of the journey
3. Trial before purchase: User testing requires grassroot support. It’s no longer a single decision instance rather smaller purchase bundles
4. Buyer & user are the same: The phenomenon changes decision and influence points in enterprise purchasing
5. Click to compare: Pricing transparency is foundational; consumer expectations are shaping enterprise behavior
Transcript
McKinsey & Company | 1
McKinsey on Marketing & Sales – Slideshare Brief LAREINA YEE | @LareinaYee @McK_MktgSales The Social Enterprise How your customers produce and consume in the social world
McKinsey & Company | 4
Record speed adoption SOURCE: Multiple press reports Time to reach 50 million users Radio 13 years iPod 3 years Internet 4 years Facebook 1 year Twitter 9 months TV 38 years
McKinsey & Company | 5
Social is everyone SOURCE: eMarketer, February 2011, McKinsey Global Institute Analysis Age NOTE: Numbers may not sum due to rounding. 16 14 13 20 18 17 22 21 21 65+ 15 2 12--17 2011 0-11 18-24 25-34 35-44 45-54 55-64 18 10 4 2010 2 17 15 9 4 2009 2 16 14 8 3% of total US users
McKinsey & Company | 6
Social is growing faster than traditional communications Unique monthly visitors SOURCE: comScore Media Metrix, October 2011; McKinsey Global Institute Analysis 31 36 -5 p.p. 2011 64 2007 69 53 69 -16 p.p. 31 47 44 18 100% = 1,430 +26 p.p. 82 76056 E-mail Instant messaging Social networking Users of service Non-users % of global online population
McKinsey & Company | 7
Enterprise usage is growing fast SOURCE: McKinsey Global Institute 2011 41 2008 29 2011 50 2008 23 2011 38 2008 27 Blogs Video Sharing Social Networking % of respondents of enterprise users Social is in the enterprise
McKinsey & Company | 8
Social impacts enterprise processes SOURCE: McKinsey web 2.0 survey, 2011, McKinsey Quarterly Scanning external environment Finding new ideas Managing projects Developing strategic plan Allocating resources Social networking n = 1,728 Wikis n = 809 Micro- blogging n = 654 Prediction markets n = 190 Blogs n = 1,322 40 9 13 529 36 12 13 429 19 17 5 212 16 8 5 411 10 4 2 25 20 - 40% 5 - 10% 10 - 20% Less than 5% Top Ranking Dimensions Total 75 73 56 43 30
McKinsey & Company | 9
Greater collaboration drives value SOURCE: McKinsey Global Institute analysis Total value at stake % of revenue Product development Operations and distribution Sales and marketing Customer service Business support functions Financial services Insurance— P&C ~3–6 Insurance— life ~3–4 Retail banking ~4–7 Consumer packaged goods ~5–6 Professional services n/a ~8–11 Advanced manufacturing Semi- conductors ~5–7 Automotive ~4–6 <0.5 0.5–2.0 >2.0 Potential value chain productivity benefit
McKinsey & Company | 10
Distributes decision making Creates permeable organizational boundaries Rapid adaptation and a shift to more iterative problem solving and product delivery Your customers’ environment is different
McKinsey & Company | 18SOURCE:
Internet search, Salesforce.com video library; KLM Facebook page Reimagine data and customer loyalty
McKinsey & Company | 19SOURCE:
McKinsey Marketing and Sales practice, McKinsey Quarterly ―The consumer decision journey‖ 39 26 22 28 11 12 26 42 100% Marketing led by the company Marketing led by the consumer Previous experience with product/brand Contact in store/ with sales agent 31 5 37 21 ▪ Word of mouth ▪ Online research ▪ Recommendations/ criticisms ▪ Traditional advertising ▪ Direct marketing ▪ Sponsorship ▪ Store experience Consider | Evaluate | Buy Rethink how you reach customers
McKinsey & Company | 20
9.3% increase in customer satisfaction as benchmarked by American Customer Satisfaction Index 150,000 customers helped through Twitter Personalized 10 versus 25,000 @comcastcares = ―Make it Right‖ Alternative rather than primary customer support channel Handles customer complaint in public arena SOURCE: Internet search, Comcast Twitter Feed, Business Week 2009 ―Comcast’s Twitter Man‖ Reimagine service and information
McKinsey & Company | 21SOURCE:
McKinsey expert interviews Customer asks Account Leader for additional information about product capabilities . . . ~5-10 emails ~3 man hours 2 days round trip ~5-10 tweets/ Chatters/ Jabbers ~30 minutes 2 hours round trip Redefine sales team workflow
McKinsey & Company | 22
The business case is clear Your customers’ expectations are shifting Be ready to adapt Social sales & marketing
McKinsey & Company | 23
LAREINA YEE | @LAREINAYEE @McK_CMSOForum ―Social economy: unlocking value and productivity through social technologies‖ http://www.mckinsey.com/insights/mgi The Social Enterprise How your customers produce and consume in the social world
Social really is here when it comes to the enterprise. Many see the role of social in consumer-focused businesses but have not absorbed what it means for the enterprise. Social is having a direct impact in 5 areas:
1. DIY prospecting: Customers conduct research on products and services well ahead of the official start to the sales cycle
2. Peer influence: Customers “pulse” their peers at every step of the journey
3. Trial before purchase: User testing requires grassroot support. It’s no longer a single decision instance rather smaller purchase bundles
4. Buyer & user are the same: The phenomenon changes decision and influence points in enterprise purchasing
5. Click to compare: Pricing transparency is foundational; consumer expectations are shaping enterprise behavior
Transcript
McKinsey & Company | 1
McKinsey on Marketing & Sales – Slideshare Brief LAREINA YEE | @LareinaYee @McK_MktgSales The Social Enterprise How your customers produce and consume in the social world
McKinsey & Company | 4
Record speed adoption SOURCE: Multiple press reports Time to reach 50 million users Radio 13 years iPod 3 years Internet 4 years Facebook 1 year Twitter 9 months TV 38 years
McKinsey & Company | 5
Social is everyone SOURCE: eMarketer, February 2011, McKinsey Global Institute Analysis Age NOTE: Numbers may not sum due to rounding. 16 14 13 20 18 17 22 21 21 65+ 15 2 12--17 2011 0-11 18-24 25-34 35-44 45-54 55-64 18 10 4 2010 2 17 15 9 4 2009 2 16 14 8 3% of total US users
McKinsey & Company | 6
Social is growing faster than traditional communications Unique monthly visitors SOURCE: comScore Media Metrix, October 2011; McKinsey Global Institute Analysis 31 36 -5 p.p. 2011 64 2007 69 53 69 -16 p.p. 31 47 44 18 100% = 1,430 +26 p.p. 82 76056 E-mail Instant messaging Social networking Users of service Non-users % of global online population
McKinsey & Company | 7
Enterprise usage is growing fast SOURCE: McKinsey Global Institute 2011 41 2008 29 2011 50 2008 23 2011 38 2008 27 Blogs Video Sharing Social Networking % of respondents of enterprise users Social is in the enterprise
McKinsey & Company | 8
Social impacts enterprise processes SOURCE: McKinsey web 2.0 survey, 2011, McKinsey Quarterly Scanning external environment Finding new ideas Managing projects Developing strategic plan Allocating resources Social networking n = 1,728 Wikis n = 809 Micro- blogging n = 654 Prediction markets n = 190 Blogs n = 1,322 40 9 13 529 36 12 13 429 19 17 5 212 16 8 5 411 10 4 2 25 20 - 40% 5 - 10% 10 - 20% Less than 5% Top Ranking Dimensions Total 75 73 56 43 30
McKinsey & Company | 9
Greater collaboration drives value SOURCE: McKinsey Global Institute analysis Total value at stake % of revenue Product development Operations and distribution Sales and marketing Customer service Business support functions Financial services Insurance— P&C ~3–6 Insurance— life ~3–4 Retail banking ~4–7 Consumer packaged goods ~5–6 Professional services n/a ~8–11 Advanced manufacturing Semi- conductors ~5–7 Automotive ~4–6 <0.5 0.5–2.0 >2.0 Potential value chain productivity benefit
McKinsey & Company | 10
Distributes decision making Creates permeable organizational boundaries Rapid adaptation and a shift to more iterative problem solving and product delivery Your customers’ environment is different
McKinsey & Company | 18SOURCE:
Internet search, Salesforce.com video library; KLM Facebook page Reimagine data and customer loyalty
McKinsey & Company | 19SOURCE:
McKinsey Marketing and Sales practice, McKinsey Quarterly ―The consumer decision journey‖ 39 26 22 28 11 12 26 42 100% Marketing led by the company Marketing led by the consumer Previous experience with product/brand Contact in store/ with sales agent 31 5 37 21 ▪ Word of mouth ▪ Online research ▪ Recommendations/ criticisms ▪ Traditional advertising ▪ Direct marketing ▪ Sponsorship ▪ Store experience Consider | Evaluate | Buy Rethink how you reach customers
McKinsey & Company | 20
9.3% increase in customer satisfaction as benchmarked by American Customer Satisfaction Index 150,000 customers helped through Twitter Personalized 10 versus 25,000 @comcastcares = ―Make it Right‖ Alternative rather than primary customer support channel Handles customer complaint in public arena SOURCE: Internet search, Comcast Twitter Feed, Business Week 2009 ―Comcast’s Twitter Man‖ Reimagine service and information
McKinsey & Company | 21SOURCE:
McKinsey expert interviews Customer asks Account Leader for additional information about product capabilities . . . ~5-10 emails ~3 man hours 2 days round trip ~5-10 tweets/ Chatters/ Jabbers ~30 minutes 2 hours round trip Redefine sales team workflow
McKinsey & Company | 22
The business case is clear Your customers’ expectations are shifting Be ready to adapt Social sales & marketing
McKinsey & Company | 23
LAREINA YEE | @LAREINAYEE @McK_CMSOForum ―Social economy: unlocking value and productivity through social technologies‖ http://www.mckinsey.com/insights/mgi The Social Enterprise How your customers produce and consume in the social world