Revenue, Loyalty and the Transformation of Support Services Presenters: Jim O'Neill, Research Analyst, Parks Associates Josh Goldlust, Vice President, Product Management, PlumChoice, Inc.
Audio Recording Details Click here to: View Recording Select one of 2 options to view the webcast in its entirety. Recording Details: Subject: Parks Webcast - Revenue, Loyalty and the Transformation of Support Services, sponsored by PlumChoice Recording URL: https://www.livemeeting.com/cc/parksassociates/view Recording ID: ZJKH36 Attendee Key: 8`4z!W2 Presented by:
Transformation of Support Services An Influx of Devices in the Home Presented by:
Consumers Add Complexity to Their Lives A Wave of New Devices is Flooding U.S. Households Over the past 12 months did your household start using a new... Game console 11% Smartphone Flat-panel TV 24% 24% Tablet 16% Streaming media player (Apple TV, Roku, etc) 4% External hard drive 8% Printer 20% Home network 5% Broadband modem 11% Computer 23% Source: Parks Associates Consumer Research 2012 Parks Associates 4
Ubiquitous Broadband in the U.S. Creates Opportunity More than 82 million households in the U.S. currently have broadband» Of those broadband HH 36% of users use anti-virus software 15% say they use a cloud-based back-up service 8% have purchased extra warranties or replacement insurance for household electronics» And they re looking to their service providers for help One-third say they re interested in virus protection from their SP 31% Would be interested in a data/file backup from their provider 24% say they re interested in purchasing extra warranties and replacement insurance from SPs www.parksassociates.com 5
The Trials of Do-It-Yourself Installation Consumers Often do their own Install Who set up the devices? Houston, We Have a Problem... What problem did you have when setting up the device? 5% 4% Did not have all the required cables 15% 18% Difficulty learning how to use it 33% 72% It did not work as advertised 11% Myself Friend/Family member A technician that came to my home A technician in a retail store or other location outside my home Difficulty connecting it to the Internet It was broken or defective 12% 29% Source: Parks Associates 2012 Parks Associates 0% 10% 20% 30% 6
There s a Demand for Tech Support Turning to Tech Support for Help, and How If you were to set-up a device again in the future, what would be your preferred method of setting it up (regardless of the cost involved)? Have a technician in the retail store set up the device at the time I purchase it Allow a technician to set up the device by remotely accessing it through the Internet Contact a technician and work with them to set up the device 6% 8% 11% How would you prefer to contact technical support? Phone 46% Face to face 26% E-mail 10% Chat/IM 7% Have a technician visit my home to set up the device 10% Set up the device myself 66% Source: Parks Associates 2012 Parks Associates 0% 10% 20% 30% 40% 50% 60% 70% 7
There s a Need, and Desire, for Premium Tech Support Opportunity in premium tech support» Nearly 20% of consumers who bought computers in the past 12 months said tech support and warranties influenced where they bought their computers Younger buyers, 18-24 years old, were nearly twice as likely to be influenced by support and warranties (31%) than buyers 45-54 (17%), likely because it represents a more significant outlay of funds» About half of consumers who bought tech support for their computer said they were concerned about accidental damage to their device, about viruses and spyware, or wanted help for technical service» 14% said they bought technical support for help in learning how to use their computer 8
Poll Question #1 When considering customer paid support programs, which would be your primary driver?» 1.) Incremental revenue generation» 2.) Increasing customer loyalty» 3.) Product differentiation» 4.) Cost avoidance» 5.) I do not currently offer a customer paid support program
Josh Goldlust, VP Product Management More than 15 years of product management and custom product development» AT&T- Director of Product Development» Neslab Instruments - developed custom OEM equipment for semiconductor fabrication equipment manufacturers Manages the comprehensive PlumChoice product and services portfolio with the market in mind.» Outsourced technology services for premium tech support or fully managed IT services» Software-as-a-service (SaaS) and software for delivering and automating support services 10
Empowering customer relationships with technology 11
Partnering with PlumChoice 12
Use Case #1: Customer Loyalty Company: Regional Appliance and Electronics Retailer Challenge: Known for excellence in customer service» Tech support was only available in-store on a transactional basis» Limited support capabilities which may result in loyal customers going elsewhere for service Solution:» Solutions echo a common focus on customer satisfaction and loyalty» Remote, white-label premium technology services solution that expanded the support relationship: Fix, Install, Teach! Benefit:» Retailer now has the opportunity to build stronger and longer relationships with their customers» Leapfrogged the competitors support offerings towards building longer term loyal relationships» Sales of tech support contracts and computers have increased, increasing lifetime value of a customer 13
Poll Question #1: ANSWER When considering customer paid support programs, which would be your primary driver?» 1.) Incremental revenue generation» 2.) Increasing customer loyalty» 3.) product differentiation» 4.) Cost avoidance» 5.) I do not currently offer a customer paid support program
Increase customer engagement and value TECHNOLOGY CARE SERVICE PROVIDER TOUCHPOINT CUSTOMER EXPERIENCE VALUE DEVICE POINT SERVICES WARRANTY PoS BREAK POINT CARE POINT 0 3 Mo 6 Mo 12 Mo 20 Mo 24 Mo TIME
Poll Question #2 Based on what you know today, how long do you expect it to take to launch a Premium Technical Support program?» 1.) Within one month» 2.) Within three months» 3.) Up to one year» 4.) More than one year 16
Use Case #2: Product Differentiation Company: Large Hardware Manufacturer Challenge:» Suffering from a commoditized product/ Lack of product differentiation» Low product margins Solution:» Launched a fully outsourced support solution in 90 days Benefit» Offering premium technical support became the product differentiation» Partner was able to delight their customers with an entire experience, rather than just a product purchase Good hardware is relatively easy to find. Good product support is not. The people were remarkable. I mulled over what I d do if it was a hardware problem and I needed a new machine. I decided I d try another (hardware manufacturer name) machine. 17
Use Case #3: Revenue Generation Company: National Telco, SMB Focused Challenge» High churn rate on core product offerings» Desired new recurring revenue offering to off-set core product declines Solution» Established and monetized support offering above and beyond existing offering and capabilities» Bundled support offering with core product Benefit» $270 Million in revenue over 4 years» New revenue sources from multiple sales channels» Bundling multiple products keeps customers coming back 18
Poll Question #2: ANSWER Based on what you know today, how long do you expect it to take to launch a Premium Technical Support program?» 1.) Within one month» 2.) Within three months» 3.) Up to one year» 4.) More than one year 19
In summary 20
How to get started with a PTS offering There are several primary drivers: revenue, loyalty, differentiation» Support can be infused into all customer touch points Program considerations» Price points - what is a customer willing to pay and under what circumstances» Packaging - bundles, point of need, proactive» Delivery - through outsourced program or broader enablement of existing resources Partner with the right provider» Experience and expertise» Value focus» Reputation for innovation» Knowledge and use of technology 21
Jim O'Neill, Research Analyst Thank You! 15950 N. Dallas Parkway, Suite 575 Dallas,Texas 75248 Office: 972.490.1113 Fax: 972.490.1133 jim.oneill@parksassociates.com Josh Goldlust, VP, Product Management Office: 866.811.3321 jgoldlust@plumchoice.com