building industrial strength customer relationships scott... · customer-facing processes identify...

Copyright 2008 IDC Reproduction is forbidden unless authorized.

All rights reserved.

Industry X.0:Building Industrial Strength

Customer Relationships

Scott Langdoc

VP, Research & Business LeaderIDC Global Retail Insights

©2008 IDC 2

Agenda

� Australia Vertical ICT Spending

� Industry 2.0 and Industrial Strength Customer Relationships

� Industry 2.0 Opportunities and Threats

� Examples of Industry 2.0– Health

– Financial services

– Retail

� Transparency — The Next Big Thing

� Essential Guidance

©2008 IDC 3

Australian 2007 Vertical IT Spending

©2008 IDC 4

What Is Industry 2.0?

�The application of Web 2.0 to a given industry–Communities form around areas of interest

–Participants freely exchange information about their experiences — both good and bad

–Web discovery via search is the natural first step for buyers

–The Internet as the primary source of knowledge

– Internal knowledge management and process improvement initiatives depend on collaboration and web 2.0 technologies

©2008 IDC 5

Industry Behavior Is Rapidly Changing

�Retail: From where consumers shop … to the WAY they shop

�Manufacturing: From procurement hubs to virtual project hubs

�Banking: From single channel to multichannel

�Healthcare: From care provisioning to customer-directed wellness

�Energy: From commodity to consumer managed

� IT: From capacity to capability

©2008 IDC 6

Industry’s Customer Quest

Goal: “Unbreakable” customer relationships

Table stakes are high

–Quality products and processes

–Exceptional service and support

Community adds additional value

–Customers support each other

–Customers are advocates and salespeople

–Collaboration identifies innovation opportunities

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Technology Goals Will Change

From … To …

Building infrastructure Building community

Creating content Creating loyalty

Enabling transactions Enabling self-service/help

Capturing eyeballs Capturing experts

Integrating applications Integrating channels

©2008 IDC 8

800 Billion/Year WW

2015

Source: IDC Internet Commerce Market Model, V10

Customer Touch Points Explode

2005

24 Billion/Year WW

# Internet Commerce Transactions and Related Accesses

Excludes email, IM, P2P,

PodCasts, Video, etc.,

etc!!!.

©2008 IDC 9

Web 2.0 Is a Double-Edge Sword

� True cross-channel sales and marketing

� Communities give us a new way to touch our customers

� Blogs and Wikis allow us to communicate to new customers

� Advanced search and knowledge management bring us new customers

� Wikis and blogs capture issues, thinking, and responses

� Customer processes must be consistent and transparent

� Communities may inform our customers of deficiencies

� Companies must monitor and participate in the discussion

� A winning search and knowledge management strategy is hard work

Your business now has a permanent record

ThreatsThreatsOpportunitiesOpportunities

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Financial Services 2.0

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Request for balance report

Format Balance Report

Periodic loadsto server;

some realtime

Back-office systems

Data Store

Publish/Receive/Connect

Any systemAny data

Any serviceEvent-based

Then and Now

Now and Tomorrow

User generated

Graphical, easily integrated, in line with end-user workflow. Adaptive to user …

User-generated content …

Retrieve balance report

Structured content

Processin-line

Structured content

Unstructured content

From Single Channel to Multichannel, Multimedia; User-Generated Content

©2008 IDC 12


� 20% of all bank spending on corporate banking portal and cash management applications has diverted to horizontal technology spend

–Portal moving to high-involvement

–Multichannel

–Customer service interaction

–Content-driven, dynamic

–Straight-through

–User generated

What Does Web 2.0 Have to Do with

Treasury and Cash Management?

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Retail 2.0Social Communities and Consumer Activism

©2008 IDC 14

How to Launch an Executive Email Carpet Bomb10 Confessions of a Chase Customer Service RepResearchers Accuse Sears of Distributing SpywareToy Makers Refuse to Recall Leaded ToysSuing Big Companies in Small Claims Court Is Fun and EasyHospital Was Filmed Dumping Homeless Paraplegic on Street, Driving OffDreamHost Still Overcharging CustomersING Holds Ex-Netbank Customers Money HostageWal-Mart's Debit Card Has Lots of Hidden FeesDead Bugs Found in Health Valley SoupFourth AT&T Cable Box Explodes6 Confessions of an Alamo Car Rental AgentMajor Retailers Data Breach Results in Wave of Credit Card FraudA Stranger Is Using the Bank Of America Debit Card

That Is Sitting in My Desk DrawerAmerican Airlines Refuses to Accept American Airlines Credit CardXbox 360 Breaks Down 5 Times in a Row, but Microsoft Refuses to Replace It

Retail 2.0: Consumer-Centric Blogs

Schadenfreude as a

business model

… And this was just in one month

©2008 IDC 15

Retail 2.0 — “Social Selling”

GlobalStock

AssortmentData

Promotions

StoreStock

SupplierProducts

Localized assortments

“Global” inventoryVisibility

The “endless aisle”

Self-Service

Precision promotionsPOS

History

SocialCommerce

Portal

Real-Time Consumer

Reviews

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Health 2.0

Consumer-directed health plans– Increase consumer responsibility and involvement

in healthcare choices

–Tools to help minimize healthcare cost

–Guiding customers to “best” providers

Acute and chronic disease communities – Individuals sharing information and advice

–Comparing notes on treatments, physicians, providers, and payers

–Looking for best options in a bad situation

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Health 2.0

Wellness communities and information portals–Web MD, Revolution Health, Healthwise

–Destination Rx, doublecheck MD

Alternate delivery models–Health Hero Network

100+ Health 2.0 start-ups

©2008 IDC 20

Industry: Business Transparency the Next Big Thing

Excellence is obvious when your customers begin to compare notes.

– Consistent high-quality products and services– Predictable across multiple channels and products

– Equitable pricing and terms

– Quality support, service, returns, exchanges

Most companies will need to invest in improved internal systems and process to thrive in this environment

– Order management – Customer community

– Quality and fulfillment – Search optimization

– Service and support mgmt. – Business process

– Customer self-help – Damage control

©2008 IDC 21

Essential Guidance

� Look for process improvement opportunities inside your own company — create transparency in customer-facing processes

� Identify and participate in relevant Internet communities

� Establish/sponsor a community for your customers and prospects

� Evaluate/improve search placement for relevant terms

� Establish “damage control” policies and procedures

� Forge industrial strength customer relationships

� Teach your customers to do the same …

©2008 IDC 21

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