Exploring the Link Between Customer Care and Brand Reputation in the Age of Social Media

The Society for New Communications Research announced the completion and availability of the research report, "Exploring the Link Between Customer Care and Brand Reputation in the Age of Social Media." Respondents were asked how often they use social media to learn about the customer care offered by the com­pany when considering a purchase. More than 70% reported that they engage in this pre-purchase behavior at least sometimes. Nineteen percent of respondents rarely use social media to learn about customer care and 9% never do.

To assess the potential influence of social media sites on user opinions as they relate to care experience, re­spondents were asked how often they take into consideration the quality of customer care offered when making buy­ing decisions. Eighty-four percent said they do consider the quality of customer care at least sometimes, while 16% said they rarely or never do.

To determine what types of online sites are considered the most valuable sources of information about the cus­tomer care experience, respondents were asked to rate a list of common online information sources. Search engines were rated as very valuable by 29% of respondents, online rating systems were considered very valuable by 21%, and discussion forums were very valuable to 17%. Some respondents also noted that trusted sources include family and friends, word-of-mouth and Consumer Reports. It is interesting to note that some forms of social media are con­sidered of no value as sources of information about customer care.

Those rated of no value include micro-blogging sites like Twitter or Pownce (39%), YouTube (27%), and social networking sites like Facebook and MySpace (22%). There are only slight variations on this with the respondents under the age of 25 being somewhat less skeptical about the value of social networking sites.

Despite the strong feelings about researching products and brands and customer care experiences online, many consumers are not optimistic about businesses taking note. When presented with the statement, “In general, businesses take customers’ opinions seriously,” less than one in three respondents agreed. Ironically, when asked why they use social media to share their customer care experiences, the most popular answer was “to protect others.” Well-intended consumers are looking for someone to listen, yet openly question if they are being heard.

It should be noted that respondents reported sharing their positive as well as negative customer care experi­ences online. Several respondents commented that they recognize excellence by posting their good customer care experiences online. In terms of industry seg­ments, technology, retail, and travel companies were reported as doing the best job, while utilities, health care, and insurance were least likely to receive positive endorsements.

While much more research is needed on this new topic, in short, this initial study indicates that there is a grow­ing group of highly desirable consumers: 25-55 year-olds, college-educated, earning $100,000+ -- a very powerful group in terms of buying behavior. These most savvy and sought after consumers are using social media to research companies. They will not support companies with poor customer care reputations, and finally, they will talk about all of this openly with others via multiple online vehicles. This research should serve as a wake-up call to companies: listen, respond, and improve.

More information on Customer Relationship Management can be found at www.CRMindustry.com

The Performance of Web Applications – One-Second Wonders for Winning or Losing Customers

A new report by the Aberdeen Group found that for more than 160 organizations that participated in the survey, business performance begins to suffer at 5.1 seconds of delay in response times of web applications. The research also revealed that every additional second of the delay in the response times could cause a decline in page views by 11%, conversations by 7% and overall customer satisfaction by 16%.

The report shows that the quality of the end-user experience is the top performance indicator that organizations are using to evaluate their success in managing the performance of web applications. However, Best-in-Class organizations are four times more likely to have capabilities in place to measure application performance from an end-user perspective as compared to Laggards. The report also outlines that Best-in-Class organizations are more likely to measure end-user experience via passive monitoring while Industry Average and Laggard organizations are predominately relying on internal monitoring of enterprise infrastructure and end-user surveys.

The report shows that 63% of organizations reported that the number of servers needed for optimal performance of Web applications has increased over the last two years. Additionally, the research shows that a cost of new server purchases makes for 21% of total cost of deploying Web applications. However, the research also shows that Best-in-Class organizations are 71% more likely to increase available server capacity as compared to Laggards while being less likely to invest in purchasing new servers.

More information on Customer Relationship Management can be found at www.CRMindustry.com

Most U.S. Companies Say Business Analytics Still Future Goal, Not Present Reality

Two-thirds of large U.S. companies believe they need to improve their analytical capabilities and only half believe they are spending enough on business analytics, according to findings of an Accenture survey. While more than half (57 percent) of companies surveyed said they don’t have a beneficial, consistently updated enterprise-wide analytical capability, nearly three-quarters (72 percent) said they are working to increase their company’s business analytics usage.

The survey also addressed the balance between using analytics and using judgment to make important business decisions, and found 60 percent of major decisions are based on analytics and 40 percent are not. The reasons executives cited most often as to why 40 percent of major decisions are based on judgment rather than business analytics were: because good data is not available (61 percent); there is no past data for the decisions and innovation they are addressing (61 percent); and their decisions rely on qualitative and subjective factors (55 percent).

The challenge to moving from “gut decisions” to employing data goes beyond just infrastructure investments. Large businesses also face a glaring human resources challenge, as 23 percent of respondents identified “insufficient quantitative skills in employees” as a main challenge to their company, and 36 percent said their company “faces a shortage of analytical talent.”

The survey also found that institutional hindrances need to be addressed to improve business analytics capabilities. For instance, 39 percent of respondents said that IT capabilities restrictions were a major challenge and 27 percent said there was an inability to share information across organizations within their company.

More information on Customer Relationship Management can be found at www.CRMindustry.com

By 2013, More than 25 percent of the Content that Workers See in a Day will be Dominated by Pictures, Video or Audio

The popularity of video among consumers will fuel a similar interest in video within enterprises, leading to the severe disruption of existing content strategies, according to Gartner Inc.The proliferation of video within the enterprise will require numerous modifications in content authoring training and procedures, information management strategy and improvements in analytic technologies. Information managers, architects, record managers and content creators will all need to adjust their strategic plans accordingly.

Enterprises that see such growth as irrelevant to their operations risk alienating themselves from customers who start to request video communication services. The typical first uses of video for commercial entities have been for promotion, generating contests where users are encouraged to submit creative or funny videos to compete for prizes or for part of a promotion.

According to a Gartner survey of 800 end-user organizations in July 2008, software for the management of images and video is the fastest-growing segment of the content management market, with just 44 percent of enterprises having such products today but 22 percent intending to install it in 2009.

Gartner believes that the popularity of simple DAM will force a number of different technological problems to be solved, such as the ability to incorporate video simply into other document types. Such uses are likely to be so compelling and the demand for them so great that by 2013, more than 25 percent of the content that workers see in a day will be dominated by pictures, video or audio.

Internet video is also driving interest in shorter bite-size videos. Consumerist expectations are intriguing customers as they see the possibility for improved search ability in rich media as well. The ability to search within a collection of videos, owned or uncontrolled, is an inevitable flare in the content market for the enterprise.

Ultimately enterprise search will subsume video search as simply another format, just as it is doing with audio, and as it did with graphical media before that. Video search will incorporate elements of social networking, social tagging, metadata extraction and application, video and audio transcription and conventional enterprise search to make it possible to find videos.

More information on Customer Relationship Management can be found at www.CRMindustry.com

Unified Communications Has Entered the Mainstream in Large Enterprises

Siemens Enterprise Communications announced the findings of its Unified Communications in the Enterprise study, showing strong interest in Unified Communications (UC) in large enterprises. The study found that more than half (53 percent) of large U.S. enterprises surveyed are actively pursuing UC installations. In fact, 16 percent have already installed UC systems and 37 percent plan to do so within the next 24 months. The most common benefits companies expect to achieve are increased productivity and business responsiveness.

Additionally, all groups interviewed perceive UC as highly beneficial in speeding business processes and improving customer satisfaction, also critical factors for staying competitive in a down economy. However, the study uncovered a disconnect between IT staff and end users. Nearly one of three end users (29 percent) said they had "much" or "extreme" interest in UC. Yet when IT was asked to estimate the end user interest, only 21 percent of IT thought that level of interest existed. In fact, among companies who were not considering UC, only two percent of IT staff estimated that end user interest in UC was "much" or "extreme". Conversely, two-thirds of large enterprise end users rank their own company's UC efforts as average at best, with 28 percent saying there was just a "glimmer of hope" or that they were stuck in the "dark ages," further emphasizing the disconnect.

The chief challenges companies believe they face when implementing UC are the need to "rip and replace" and the "all or nothing" nature of UC, which leads to a perception that UC can potentially be difficult and expensive to adopt.

More information on Customer Relationship Management can be found at www.CRMindustry.com

Survey Finds 90 Percent of Respondents Expect to Maintain or Grow Usage of SaaS

Nearly 90 percent of organizations surveyed expect to maintain or grow their usage of software as a service (SaaS), citing cost-effectiveness and ease/speed of deployment as primary reasons for adoption, according to a recent survey by Gartner Inc.

Replacement of on-premises solutions and net-new implementations were cited as major drivers of future deployments. More than one-third of respondents indicated plans to transition from on-premises to SaaS. The key drivers cited included total cost of ownership (TCO), and unmet performance expectations with on-premises solutions, in addition to changes in sourcing strategy.

The survey was conducted across eight major countries worldwide in June and July 2008 with 258 qualified respondents completing the survey. Qualified respondents were those individuals within the organizations personally involved in the implementation support, implementation, planning and/or budget decisions related to the purchase of enterprise application software. Organizations participating in the survey were either currently using SaaS, or planned to use it within the next 12 months.

North American respondents showed a greater confidence that their organizations will increase investments in products offered as SaaS or through a subscription model through year-end 2010, compared with those in Europe and Asia/Pacific. Sixty two percent of North American respondents said that they expected new investments to increase slightly and 15 percent said that they expected new investments to increase significantly compared with 49 percent and 15 percent, respectively, in Europe and 55 percent and 5 percent, respectively, in Asia/Pacific. North America was an early adopter of solutions delivered through the SaaS model, with more than 20 percent of respondents indicating use for five years or longer and 60 percent having adopted it in the last three years.

Gartner’s survey found that 37 percent of respondents were transitioning from a current on-premises solution to a SaaS solution. This drive is particularly significant in Asia/Pacific where 50 percent of respondents indicated that they were shifting away from on-premises and India indicated a 70 percent conversion. When asked why their organizations were transitioning from a current on-premises solution to a SaaS solution, respondents' consistent message was that the TCO was becoming too financially onerous. Given the likelihood of reduced discretionary spending in 2009 and perhaps 2010, Gartner expects that these driving forces will foster greater demand for SaaS solutions rather than budgets directed at enhancing — or furthering investment for — on-premises solutions.

Despite the increase in usage of SaaS, most respondents to Gartner’s survey indicated that no policies had been instituted to govern the evaluation and use of SaaS. Only 38 percent of total respondents that are currently using SaaS have a process or policy that guides the evaluation, procurement and deployment of SaaS. The majority of these organizations are based in Europe and North America. While another 30 percent indicated plans to develop these policies and or processes, another 26 percent have no plans at all to address this issue. Ms. Mertz said that the importance of governance mechanisms will increase as SaaS becomes a larger element of a company’s overall sourcing strategy.

More information on Customer Relationship Management can be found at www.CRMindustry.com

Customer Satisfaction on Cyber Monday Exceeds Expectations

Although Cyber Monday shoppers were less satisfied with their online experience this year than they were in 2007, satisfaction is better than it was a month ago, according to a new study from leading online customer satisfaction measurement firm ForeSee Results. The study collected responses from more than 250,000 people who shopped online between Black Friday and Cyber Monday.

Online customer satisfaction was actually higher on Cyber Monday than it was at any point in November, including over the holiday weekend. Usually the opposite is true: satisfaction levels fall on Cyber Monday as online shoppers fail to find the deep discounts and free shipping offers they expect.

Key survey results include:

--Cyber Monday shoppers were less satisfied in 2008 than on the same day last year. In 2008, Cyber Monday customer satisfaction was down almost 1% from 2007 (score of 75.9 in 2008 vs. 76.6 in 2007 on the study’s 100-point scale).

--Despite the year-over-year dip in online customer satisfaction on Cyber Monday, satisfaction is actually higher than it was at any point in November, a reversal of the recent trend of satisfaction that is lower on Cyber Monday than in previous weeks. The unusual rise in satisfaction over the holiday weekend and into Cyber Monday can be attributed to e-retailers’ unprecedented ability to live up to the promise of deals and discounts that Cyber Monday shoppers have come to expect. In previous years, dips in customer satisfaction on Cyber Monday have been attributed to strain on systems due to higher volumes and unfamiliarity of new shoppers drawn to the site for the first time by a discount or sale. The rise this year may indicate that e-retail sites are starting to overcome these challenges successfully.

--In a down economy, successful e-retailers have more to gain. ForeSee Results’ data analysis shows that on e-retail websites with superior satisfaction scores (over 80 on the study’s 100-point scale), customers are significantly more likely to purchase online and offline than are visitors to sites with subpar customer satisfaction (below 70).

More information on Customer Relationship Management can be found at www.CRMindustry.com

Losing Loyal Online Customers Carries a High Price

Online retailers must provide a shopping experience more akin to a physical store's if they want customers to increase their spending. These are the findings in a new report by retail industry experts Verdict Consulting for WebLoyalty. With online sales predicted to grow by 129% over the next five years, online retailers have a large commercial incentive if they can apply the techniques used by physical stores to tempt customers to increase their discretionary spend when they shop online.

But - says Verdict - it's not just about boosting unplanned customer spending. Getting the basics right such as easy navigation at the point of purchase and offering more choice and better value for money are equally important for generating loyal customers.

Even so, until sites improve, Verdict calculates that levels of online loyalty are still some 10% lower than in physical shops as we stand today.

According to the Verdict Consulting report, online customers abandon almost a quarter (24.8%) of their shopping carts before sales are completed. This equates to around 95m transactions a year so businesses that employ strategies to prevent shopping cart abandonment have the opportunity to claw back significant potential lost revenue.

The reasons customers abandon their carts range from well-established concerns over giving out their personal financial details, to high delivery charges and illogical or poorly designed navigation of some sites.

But if online retailers can get it right, almost a fifth of respondents (19%) sampled by Verdict said they would be loyal customers if a website was easy to navigate and offered good service and competitive prices.

More information on Customer Relationship Management can be found at www.CRMindustry.com