I attended Gainsight’s Pusle conference on customer success, held in San Francisco, on May 12 and 13. This conference, which focused on the economic value of customer success, actionable customer success best practices and insight from customer success practitioners, drew over 2000 attendees across 20 countries. This was more than double the size of last year's conference. The speaker list read like a who’s who in the world of young B2B SaaS companies: Apttus, Box, Zuora, Yelp, Satmetrix, MindTouch, Zendesk, Influitive, InsideSales, Docusign, Atlassian amongst others, as well as more established companies such as SAP, ATT, Salesforce, LinkedIn, Workday. It also drew a long list of VC luminaries including Roger Lee from Battery Ventures, Jason Lemkin from Storm Ventures and SaaStr, Tomasz Tunguz from Redpoint Ventures and Ajay Agrawal from Bain Capital Ventures,.
So why the interest in customer success?
Our world has moved to a subscription economy. Categories like media and entertainment and telecommunications have fully embraced this model. Other industries like publishing, computer storage, healthcare, are moving in this direction. This shift is most notable in B2B software.
In the past week, I have booked a flight using a travel voucher, questioned a charge on my credit card bill, and bought an electric toothbrush. What do these experiences have in common? In each case, I had a relatively complex question and I received a helpful answer – without talking to anyone in person or by phone. Instead, with a little online research, I was able to identify which blackout dates applied to my travel voucher, clear the charge on my credit card bill, and learn the best settings for my toothbrush.
Essentially, I sought answers immediately by turning to digital channels first. In this regard, I’m not the only one. For the first time in the history of our research, more US online adults report using company websites than speaking with agents by phone when resolving customer service needs. Forrester’s Consumer Technographics® data shows that 76% of consumers turn to FAQ pages, and usage across other digital channels is growing notably:
The fact that technology is disrupting the way in which customers seek information is not merely a trend – it’s at a tipping point. In the age of the customer, consumers expect accurate answers with greater speed and less friction than before; as companies offer them detailed online content with increasingly effective navigation strategies, consumers will embrace self-service digital channels at the expense of offline communication.
Great books, from great clients... Forrester's Board of Clients were in Cambridge this week. This brilliant cross-section of our 2,400 clients tells us what we are doing right, what we can do better, and where we should go.
I always love the pre-meeting dinner. It typically turns into an intellecutal/techie slug-fest fueled by good wine. We did it this year in the restaurant where Mitch Kapor famously told Steve Jobs, "I'll make you a deal. You stay away from commenting on my dietary habits, and I will stay away from the subject of your personality."
Some random thoughts/conclusions from our discussion... Only one board member had a smart watch (not Apple), but 50% think they will wear one within two years. Moore's Law grinds onward, but corporate organization and culture lag dangerously far behind. Big companies must innovate outside of the core, but then must know how to successfully bring it back inside.
And over dessert we talked about our favorite book of the moment. This year there was a dystopian, sci-fi overtone. Here's the list:
Historically I have not been a big fan of Interop for a variety of reasons. However Greg Ferro, George Stefanick, Ivan Pepelnjak, and Harvard Business Review IT Director Ken Griffin — to name a few — changed the breakout sessions experience for me. During Greg’s data center network session, he said something that was priceless. He was giving some guidance around refresh cycles and told the audience to not worry about investment protection. It was so refreshing to hear it. I wasn’t the only one nodding my head: Investment protection is hogwash.
Greg made the case that moving to a 3-year replacement cycle changes a customer’s buying and design criteria. Right now, customers have to guess what is going to happen over an 8- to 10-year cycle; this long term guess creates the desire to protect that amount of spending with “investment protection” features. By considering flexibility, growth, and scalability of the network over that period, customers lean towards chassis switches with ports, which can cost 5 to 10 times as much as a pair of 1RU switches with the same type of ports. By selecting chassis switches, Greg says customers have doubled or tripled their project cost.
However on a 3-year replacement cycle, customers can choose right-sized equipment (which is probably a 1RU switch), do less maintenance, and gain faster access to new features. In addition, the risk could be lower. For example if bad decision was made, a company is only stuck with selection for 3 years. Or, the company can choose to replace the network earlier and take smaller hit on capital expense line than if the compay bought chassis switches.
Convergences are cool when they happen, and for the past two months, I’ve been experiencing one around customer experience measurement. Today, I was on the phone with a massive government agency talking about the way it measures customer experience and why it’s not working. Next week, I’ll have another discussion with a major communications company about rebuilding its customer experience (CX) measurement system from brownfield and will also meet with a leader from a major software company on overhauling customer experience measurement globally. Two weeks ago, I met with the head of digital at a top-five bank about rethinking how to measure the digital customer experience.
This is a guest post by Danielle Geoffroy, Research Associate on the AD&D team who helps with our customer service and unified communications research.
Do you hear that swooshing sound of a tweet being sent in the middle of a Google Hangout? It’s faint, but strong, and it means they’re coming. Generation Y—a generation raised entirely in a technology-driven world. This new breed of consumers demands more from companies and government agencies, with particularly high expectations for friction-free customer experiences. They’re prepared with knowledge of your company, and your top competitors. In fact, they often have more information about you and your products than your own employees.
This new generation should matter to you, because by 2018, the millennials will surpass the spending power of baby boomers. Remember: there is a dollar value to every positive and negative Yelp review, tweet, and Facebook status they target at you. With so much information at consumer’s fingertips, there is some give with the take. People don’t want to retain all of the information they receive on a daily basis. Striking a balance between the knowledge of your customers, and the methods deployed by your customer support agents, will lead to an enjoyable service experience, and keep you far away from the dreaded viral video of a support request gone wrong.
Why do CIOs not become CEOs? What prevents them from achieving at the highest organizational levels?
It's because they don't have their hands on revenue, unlike CMOs, CFOs, brand marketers, and strategists.
But now we are entering an era where CIOs must manage two agendas: 1) the internal systems (IT), and 2) the systems, processes, and technologies to win, serve, and retain customers, what we call business technology (BT). As shown, CIOs should be guiding their companies along a path to high IT and high BT -- the place where technology will truly move revenue and profit.
Is it happening now? At the Wall Street Journal CIO Network event, I asked attendees if they were involved with serving customers and building BT agendas -- most of the hands in the room went up. I thought: "Wow...a pretty advanced group." But at the end of the conference the CIOs presented their collective priorities. The word "customer" was nowhere to be seen. The list was a litany of traditional IT agenda items -- from training to H1B visas to creating more of a "business vision," whatever that is.
Over the past few weeks, I spent several days in both China and Brazil speaking with eCommerce executives about the opportunities and challenges in their respective markets. Despite the vastly different market sizes – China’s retail eCommerce market reached $440B in 2014 while Brazil’s came in at $18B – these two countries are similar in that they both dwarf other markets in their regions in terms of online sales.
There are many different ways to look at eCommerce in China vs. Brazil; below are just a few areas in which these markets differ and where they show similarities:
Mobile evolution is at different stages. In China, Alibaba's Q1 2015 results showed mobile to be 51% of GMV across its marketplaces, up from 27% a year ago. In Brazil, by contrast, eCommerce players of all types tend to see lower figures in terms of both GMV and total transactions via mobile. B2W, for example, one of the top players in online retail in Brazil, reported that 16% of orders placed in Q1 2015 were via mobile. As the percentage of mobile revenues grows in both markets, so will expectations of companies’ mobile experiences.
At Alibaba, overall sales are shifting heavily toward mobile
Fitbit made its S1 filing coming off a quarter of astounding growth: $336.8M in revenue – up from $108.8M in Q1 2014. The enterprise generated $48M in net income. Last week we learned it hopes to raise $100M through an IPO. Why would Fitbit IPO now?
There are any number of traditional reasons - raise capital, return money to investors, etc. But what is interesting to debate, however, is the timing of Fitbit’s IPO. Fitbit may have chosen to IPO now so it can:
Draft off Apple’s wave. Fitness bands and smart watches have been on the market for years, but sales have been limited – especially for smart watches. Apple’s entry and marketing spend will drive awareness of the category from early adopters on the west coast to mainstream consumers. The tide will lift all boats, as the saying goes.
Raise capital at a possible peak. The smart watch may kill off or stymy the growth of lower end fitness bands. The cameras on early mobile phones were not as good as the digital point and shoot cameras or SLR’s owned by consumers, but a camera on hand is better than the one at home in a drawer or closet. The pedometer and sensors on a smart watch may not measure activity with the same precision as a dedicated device, but it may be good enough for many consumers.
Take advantage of a market with few IPO candidates. Few small companies will mature enough – let alone show the financial strength – to take their companies public. Many entrepreneurs are building services that make great features rather than great businesses. Their exit strategy is to sell to a Google, Facebook, Salesforce.com, IBM, Oracle, Microsoft, or SAP.
As far as digital store initiatives go, iron-clad success stories are notoriously hard to come by. Mobile point-of-service (mPOS) is one of the few digital store technologies that has garnered the attention and investment dollars of retail executives—but the return on investment has been nonetheless elusive. Despite large-scale deployments by a number of leading players (including Nordstrom, Urban Outfitters, and Bloomingdales, among others), key questions such as “will this drive incremental revenue?” and “which use cases deliver the most customer and retailer value?” remain. Our newly published report “The Business Case For mPOS Is Associate Enablement” answers these questions and addresses common opportunities and challenges for eBusiness leaders rolling out an mPOS program. In the report, we find that:
Consumers expect digitally-enabled associates to facilitate in-store engagement. Retailers must change their thinking and start to view mPOS as more than just a “mobile cash register.” When shoppers see a store associate armed with a mobile device, they expect to receive contextualized assistance when and where they want it. In addition to ringing up sales in aisle, your associates should be prepared to use their devices to access enterprise inventory, provide product information, and give personalized product recommendations.