Getting Maximum Value from Your Customer Community Investment

Michael Fauscette, Group VP, Software Business Solutions

about.me/mfauscette @mfauscette

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@mfauscette

The Goal of Business is to Create a Customer

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Peter Drucker

The Goal of The Customer is to Fill a Need (or want, desire, etc.)

Me

@mfauscette

Technology  Disrupters  

 Cost  take-­‐out  (to  fund  

innovation)  

 Talent  (Skills)  &/or  capacity  

gap  

IT

Challenging Times

Changing  Customer  Demands  

Increasing  Competition  

Challenging  Macro  

Conditions  

BUSINESS

Source: IDC C-Suite Barometer and IDC Research 4

INITIATIVES  2013    

Market  Expansion  &  Customer  Experience  1

CONCERNS  2013    

Acquire  new  customers  &  reduce  churn  1

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Expectations Experience

Satisfaction

Getting it “right”

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Sales Finance Etc… Service Marketing

CUSTOMER FACING (CONNECTED)

NON-CUSTOMER FACING

(DISCONNECTED)

Customer Relationship Management? Data optimized by functional area

Source: IDC Research

@mfauscette Source: IDC Research

Reduce Churn, Improved loyalty, satisfaction, better experience

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Coordinating the internal Optimized Data Aligned with Corporate Goals

Marketing Sales Service Finance Etc…

CUSTOMER FACING

Campaign execution, brand control

Up-sell, cross-sell, reference selling

Product Innovation based on customer input

$ – CFO Improved Customer Service

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Building an ongoing customer relationship

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Awareness

Discovery

Attraction

Interaction

Purchase

Use

Cultivation

Advocacy

(*1) The probability of selling to a new prospect is 5-20% (*2) The probability of selling to an existing customer is close to 70%.

Source: IDC Research & Marketing Metrics (*1,2)

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Michael Fauscette

Mike Fauscette

mfauscette

Larry Fauscette

Larry Michael Fauscette

Larry M Fauscette

mike_fauscette

mfauscette@gmail.com mfauscette@me.com

mfauscette@iCloud.com mfauscette@idc.com

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@mfauscette

Why?

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Q. What specific initiatives are you planning to conduct using social software for BUSINESS purposes in the next 12 months?

N=701, IDC Social Software Survey,, February 2013

0% 5% 10% 15% 20% 25% 30% 35% 40%

Internal gamification (particularly behavior analytics) External Gamification (particularly behavior analytics)

Internal micro-blog External micro-blog for marketing / customer service/

Crowdsourcing External Discussion forum

"Innovation Management (more complex than Prediction market

Internal Discussion forum Geo-Social networking

"Ideasourcing (tools that are used to collect ideas/ File/Content sharing service

Blog/Wiki Online office productivity

Peer feedback Web broadcasting

Enterprise Social Network (including activity streams) Web chat/voice/video over IP applications (including

Recruiting Socialytics (analytic tools and applications used to

Application/Video Sharing Public social network for marketing /customer service/

Social Learning Online communities

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Business Benefit of Community

§  Acquire New Customers

§  Design Better Products

§  Reduce Support Costs

§  Customer Intelligence Driven Marketing

§  Creating Engagement – Finding / Nurturing Influence

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Business Value of Community - Marketing

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giffgaff

§  Sim card only mobile virtual network provider

§  Community support only model

§  Almost no marketing spend

§  Rewards model

§  75% of new subscribers WoM

§  Net Promoter Score 73%

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Building Advocates

§  American Diabetes Association – Community members 5X more likely to take advocacy actions

§  EMC – social virtual product launches •  From a few hundred in person to >10K online

participants •  Saving $750K per year in product launches while

increasing effectiveness

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Business Value of Community - Sales

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Sephora BeautyTalk

§  Personal beauty advice and product recommendations

§  Superfans = >33 hours per month on the community

§  Community users spend 2.5X average customers

§  BeautyTalk superfans spend 10X average customers

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Brocade

§  Shifting from indirect to direct model (post Foundry acquisition)

§  New world of “sales”

§  Community •  New product awareness •  Needs and issues •  P2P •  Certification •  Thought leadership and 1 face to the customer

§  Connecting inside out – outside in •  fresh content = engagement •  Closer to the customers

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Business Value of Community - Customer Service

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Mint.com

§  Community based P2P model

§  Increased customer satisfaction and retention

§  132K registered users – 47,750 topics in 12 months

§  75% reduction in support tickets

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Redefining Support

§  Cisco – Networked approach = 32% reduction in time to resolve and $7M in savings

§  Autodesk – community deflected 25% of call volume = $6.8M in savings

§  Ustream – 55% reduction in support costs

§  Webtrends – 80% issues resolved in community

§  FotoMoto – while growing biz 5X reduced support costs 30%

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Business Value of Community - Product Innovation

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National Instruments

§  Co-Innovation in product development

§  Better / more useful products

§  >3700 submitted ideas / >73K votes

§  12+ new features per release

§  $7.5M in call deflection savings

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Product Innovation

§  TechSmith – 1200 new product ideas saved $500K in beta testing

§  Telenav - >3K customers shared product ideas

§  AthenaHealth – mobile app built from direct customer input and >1400 product ideas

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Business Benefit of Community

Acquire New Customers •  Know your customer •  Engage your customer •  Learn about your customer = Sales Intelligence

Design Better Products •  Idea sourcing •  Innovation •  Voice of customer

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@mfauscette

Business Benefit of Community

Reduce Support Cost •  Peer-to-peer support •  Reduced support tickets •  Better self-service

Customer Intelligence Driven Marketing •  Customer data value chain •  Predictive as well as reactive •  On target – 1:1

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Community Best Practices

§  Communities are not a “field of dreams”

§  Professional management

§  Analytics drive engagement

§  Gamification

§  Cross-function but 1 voice

§  Trust

§  Keep it Fresh

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Sense and Respond

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And Remember…

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•  Give Value to Get Value

•  Connect outside in and inside out

•  Silos are the enemy

•  Technology isn’t enough – culture and process

•  Sense and Respond

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Michael  Fausce,e    Group  Vice  President  So7ware  Business  Solu:ons    mfausce,e@idc.com    @mfausce,e  about.me/mfausce,e  

Thank You

Blog: www.mfauscette.com IDC Social Business Blog https://idc-insights-community.com/groups/it_agenda/social-business

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