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Enterprise 2.0 & Social CRM: Together At Last

  1. E20’s & SCRM’s Twain Meet
  2. The Social Customer
  3. This is a SOCIAL transformation – a revolution in communications - that impacts all institutions – business included
  4. The Social Customer
  5. "Companies used to focus on making new, better, or cheaper products and services....Now the game is to create wonderful and emotional experiences for consumers around whatever is being sold. Its the experience that counts, not the product." “People…want capabilities and options, not uniform products…business is there to provide the tools.” “The Knowledge Economy is giving way to the Creative Economy...” (Knowledge has become a commodity so the solution is to) "focus on innovation and design as the new corporate core competencies." BUSINESSWEEK, DECEMBER 19, 2005
  6. “NBC Universal announced sweeping cuts to its television operations yesterday, demonstrating just how far a once- unrivaled network must now go to stay competitive with YouTube, social networks, video games and other upstart media.” – Washington Post, October 21, 2006
  7.  Sea change in use of technology ◦ Gen Y first generation to spend more time on the ‘Net than watching TV ◦ Implications for marketing staggering  74% of all adults on the web are engaged with a social network/community The Social Customer
  8. • Using Social Networks • Nielsen Online research “Global Faces on Networked Places” (March 2009): • Fastest growing sector for Internet use is communities and blog sites (5.4% in a year) • Member communities reach more Internet users (66.8%) than email (65.1%) The Social Customer
  9.  Conversation is controlled by the customer ◦ Review sites  Yelp ◦ Social networks/communities  Service complaint oriented – Planetfeedback  Get Satisfaction  Facebook pages ◦ Social Media Properties  Social Media Today (SMT) ◦ Blogs  Social Customer ◦ Podcasts  Geek Brief TV
  10. • The Social Customer – Now ◦ New definition of trusted source  2009 Edelman Trust Barometer (58%), most trusted – “a person like me.”  Not an industry expert or academician or financial advisor ◦ Consumer thinking penetrates the enterprise (Blackberry Pearl) ◦ Customer begin to include business as feature of life choice, not a separate factor – user generated content becomes part of business (Samsung open IP to engineers) ◦ Collaboration between company & customers to provide useful value for each begins ◦ Personal value chain subsumes enterprise value chain ◦ Social networks as active participants in effecting change (blogosphere, podcasting) ◦ Ubiquitous, easy to use technologies ◦ The social web becomes a primary communications medium ◦ The social customer is increasingly mobile ◦ Unified communications The Social Customer
  11. Source: Brian Solis 12
  12. • Three Things to consider: • How do you deal with customers wanting a personalized experience – whether or not you think of them as high or low value? • Once you figure out that, how do you deal with the millions of customers you might have? • How do you leverage what you have internally to help support their experience?
  13. The Definition of Social CRM
  14. “CRM is a philosophy and a business strategy, supported by a system and a technology, designed to improve human interactions in a business environment.” CRM 15
  15. "CRM is no longer just a model for managing customers but one of customer engagement." From CRM to Social CRM 17
  16.  Five Simple Principles of Social CRM 1. Value & values are given & in return, value & values are received (collaboration, co-creation, mutual value, transparency, authenticity, advocacy) 2. Each of us is governed by self-interest (personalization, controlling own experiences) 3. We are social creatures too (conversation, collaboration, data capture/insight) 4. For ideas to be truly exciting, they have to be real (measurement, analytics, realistic objectives, success) 5. Do unto others…you know the rest (customer experience, customer-company interactions) 18
  17. “Social CRM is a philosophy & a business strategy, supported by a technology platform, business rules, workflow, processes & social characteristics, designed to engage the customer in a collaborative conversation in order to provide mutually beneficial value in a trusted & transparent business environment. It’s the company’s programmatic response to the customer’s ownership of the conversation.” Social CRM 19
  18. Why Convergence?
  19. 22 | ©2010, Cognizant Technology Solutions Confidential Recognize opportunities for today  Embracing these shifts is not just an academic discussion  Already seeing a real business impact Source: Next-Generation CIOs; a Cognizant study in cooperation with the Economist Intelligence Unit Base: 402 IT and business decision makers – director and above – from Europe and North America. 35% will have measureable ROI within the next 12 months The benefits of enterprise collaboration are recognized mainstream
  20. But…..It’s time to engage the customers, not just the staff
  21. IBM Institute for Business Value CEO 2010 Study 88% of all CEOs say that getting closer to customer next five years top priority 78% of all customers say they would be willing to co- create products with company
  22. Source: E20 Study, D3 Interim Report – IDC, Headshift, Tech4i2 Some areas for convergence between E20 & SCRM are clear cut
  23. Convergence in a simplified sense means extending an invitation for the customer to collaborate with the company when the company is already doing it internally.
  24.  E20 ◦ Knowledge creation/sharing ◦ Many to many communication ◦ Transparency ◦ Internal ◦ Improve employee morale ◦ Behind the firewall  Social CRM ◦ Knowledge creation/sharing ◦ Many to many communication ◦ Transparency ◦ Outreach ◦ Improve customer loyalty ◦ From outside the firewall to behind the firewall and vice versa
  25.  Cultural Advantage of E20 ◦ Corporate environment that invites collaboration and openness  Cultural Disadvantage of E20 ◦ Not exactly the same culture but not distinctly different Still must be willing to cede control of conversation to the customer
  26.  Closest sales culture is one that involves collaboration across departments, geography, roles ◦ Uses historical data and employee cooperation & opinion to optimize the chances of success in closing deals or identifying opportunity ◦ Enterprise collaboration
  27.  Core concerns ◦ Transparency – how much of what you share with employees, do you share with customers?  Profile information  Internal knowledge ◦ Regulatory impact ◦ Measuring value in return ◦ Technical – from outside the firewall to inside the firewall
  28.  USEO ◦ Small French consulting firm for customized workforce collaboration systems ◦ Built external public community combined with internal collaboration  Public community discussion on Web 2.0 tools  1000 members  Internal collaboration shared projects  USEO consultants participate in community as experts using their shared knowledge  Results – 4 clients so far. Source: E20 Study, D3 Interim Report – IDC, Headshift, Tech4i2
  29. The Collaborative Value Chain
  30.  Great customer experience historically required seamless enterprise value chain functioning ◦ Supply chain ◦ Demand chain (customer facing) ◦ Back office ◦ Partners ◦ Suppliers/vendors
  31.  Customer intersects company’s value chain in part ◦ Meaning CVC consists of EVC + a portion of the customer’s personal value chain ◦ Has serious implications for customer experiencePVC EVC Vendors/ Suppliers Friends Family Everything Else Going On Other Companies External Agencies Partners/ Channels EVC Company Part of PVC Intersects EVC Customer
  32.  Notwithstanding all external conversations, social customer wants to get involved with companies they care about to: ◦ Solve part of their personal agenda ◦ Create and play ◦ Make themselves feel good
  33.  The customer that concerns us is a subset of social customers ◦ This is the “lead user” (Eric Von Hippel, Democratizing Innovation)  A passionate customer who actually cares enough to want to take care of their own needs - not build a product for you  Everyone is self-interested (Principle #2)
  34.  Customers as partners, not “objects of a sale”
  35. The Value of Convergence: Co- Creation & Business
  36.  CUSTOMER-MADE CO- CREATION: “The phenomenon of corporations creating goods, services and experiences in close cooperation with experienced and creative consumers, tapping into their intellectual capital, and in exchange giving them a direct say in (and rewarding them for) what actually gets produced, manufactured, developed, designed, serviced, or processed.” (Trend-Watching) Source: Davos Economic Forum 2009, World Institute of Design
  37.  Co-creation ◦ When customers interact with companies (or even products per se) in a way that supports value creation and shapes the customer’s actual experience
  38.  It could be: ◦ A customer driven design competition ◦ A comment in an ideation community that is voted up by the members ◦ Product input by customers leading to changes by the product team ◦ An innovation “jam” ◦ Open source
  39.  Innovation - what it isn’t ◦ One way feedback ◦ A focus group ◦ A customer (or company) making their own product w/o collaboration ◦ Personalization ◦ Customization
  40. A Case Study
  41.  300 brands ◦ 23 of those brands $1 billion and up (e.g., Charmin, Crest, Folgers, Downy, Pringles, Tide)  2 billion consumers affected w/6 billion as goal  160 countries reached  One of 30 companies on the Dow Jones Industrial Average (DJIA) Case Study: Procter & Gamble
  42. “We have to create a great experience every time you touch the brand, and the design is a really big part of creating the experience and the emotion. We try to make a customer’s experience better, but better in her terms.” – A.G. Lafley, CEO Proctor & Gamble “I think its value that rules the world. There’s an awful lot of evidence across an awful lot of categories that consumers will pay more for better design, better performance, better quality, better value and better experiences.” – A.G. Lafley, CEO, Proctor & Gamble Case Study: Procter & Gamble
  43.  Key Performance Indicators ◦ Out of stock rates ◦ Total supply chain response time – from purchase at register to purchase of raw materials to replace product ◦ Shelf level quality – damaged or unappealing packages on store shelves – reduction to zero ◦ Pricing design from the shelf back – what price is appealing to customer and then reverse engineer to see if product can be produced to make that price point  Results? ◦ 7.6% out of stock rates rather than 16.3% from 2003 to 2004 ◦ Earnings growth went from 15% in 2002 to 20% in 2004 ◦ Annual savings between $50 and $100 million ◦ Increased sales from $40 billion in 2002 to $43.4 billion in 2003 Case Study: Procter & Gamble
  44.  Focused around the collaboration between company & user communities ◦ Sales/Marketing  Vocalpoint – 600,000 moms ◦ Research  Technology entrepreneur networks  Benefits?  In 2001 – 20% of ideas, products, technologies external  In 2004 – 35% of ideas, products, technologies external  In 2010 – 50% of ideas, products, technologies external  Virtual design, 3D simulation Case Study: Procter & Gamble
  45.  Connect + Develop ◦ Constant flow of needs being put out to anyone who cares to join the Connect & Develop program  P&G ties entrepreneurs, inventors, suppliers etc together to collaborate on R&D that they need (e.g. packaging)  Assets available for license  Have reqs & have open forum Case Study: Procter & Gamble
  46.  Connect + Develop ◦ Proposals can be:  Sent unsolicited  Partnered  External Network (e.g. Innocentive)  Outreach from P&G to specific groups Case Study: Procter & Gamble
  47. Connect + Develop Success Stories Several hundred products created via company/customer/partner collaboration Case Study: Procter & Gamble
  48. Connect + Develop Works  50% of products come externally  R&D productivity up 60%  R&D as percentage of sales is down from 4.8% to 3.4%  Over 100 new products Case Study: Procter & Gamble
  49. Author: CRM at the Speed of Light (4th Edition, February 2009) President: The 56 Group, LLC Managing Partner/CCO: BPT Partners EVP: National CRM Assn. Member: CRM Magazine CRM Hall of Fame, 2010 CRM Magazine 2008 Top Influencer Named #1 CRM Influencer (Non Vendor) by InsideCRM 2007 Named #1 CRM Blogger 2005, twice in 2007 by TechTarget and InsideCRM & InsideCRM 2008, Forecasting Clouds, 2010 PGreenblog: Social CRM: The Conversation: Email: Twitter: Facebook: Cell phone: 703-551-2337 THANK YOU