Salesforce.com Harnesses the Wisdom of Crowds in the Service Cloud

6
516 views

Share on LinkedIn

Salesforce.com just announced the “Service Cloud,” an Internet-based solution that, yes, does customer service. But, the key is the potential leverage with social computing platforms like Google and Facebook, to enable the emerging world of “social business.”

As CEO Marc Benioff said at the announcement in San Francisco on Jan. 15, the point of the Service Cloud is to “enable businesses to join the conversation” that is already happening on the Web, often without any involvement by the company. Currently about 50% of the time (Gartner), when someone needs help the first step is to Google for an answer, which could lead to forums, groups and social networks where customers/users help each other.

That’s certainly been my experience. Formal support channels are often too complicated. If I can get a few helpful hits after a Google search, why waste time searching a complex knowledgebase or submitting an incident?

The problem is, the company is out of the loop. It doesn’t learn from the community insight and doesn’t get engaged until the customer decides to contact the company or submit a formal incident.



Or, worse, until a problem becomes a PR embarrassment after a blog or YouTube video goes viral. By then (just ask Dell), it’s too late.

Essentially, Salesforce.com is expanding the definition of “multi-channel” beyond traditional phone, email, chat and web interactions to also include the outside world of search engines (e.g. Google), social networks (e.g. Facebook), online communities and even partners.

Is the Service Cloud Groundbreaking?

“Cloud computing” has become the latest buzzword to describe computing on the Internet. But the concept goes back into the late 1990s under the term ASP (Application Service Provider), to be followed by “on-demand” and then SaaS (Software as a Service). Web-based CSS is hardly a new idea.

What about CSS functionality? Frankly, I think it’s a stretch even for the bombastic Benioff to claim that Salesforce.com is “the enterprise standard” or in the “leadership position” for CSS, as he did in his announcement speech. Salesforce.com’s CSS app has improved in the past couple of years, but it’s lightweight compared to other CSS-focused vendors like eGain, KANA and RightNow.

Forrester analyst Natalie Petouhoff writes in her Q4/2008 CSS “Forrester Wave” report, that Salesforce.com is classified as a leading “record-centric” CSS solution and (along with Microsoft and Entellium) offers “sufficient technical capabilities to handle simpler customer service requirements and package these features in low-cost solutions that are quick to implement.”

That’s being “damned with faint praise,” in my book. Translating the analyst-speak: Salesforce.com is not ready for complex CSS applications in large enterprises.

Targeting the $3 Billion CSS Market

Still, Salesforce.com claims 6,500 CSS customers, a significant number even if they’re small. Gartner says the CSS market is a $3B opportunity, and Salesforce.com can’t flog the SFA horse much longer to keep growing a $1 billion per year business.

So, CSS appears to be a strategic priority for Salesforce.com. The $31M acquisition of Instranet last year probably was the start of a big push. Now we have the Service Cloud.

In the future, I’d like to see text mining integrated, so that insight can be gleaned from analyzing unstructured conversations. Salesforce.com’s CSS head honcho (and former CEO of Instranet) Alex Dayon hinted this may be coming.



The Service Cloud is a brilliant marketing and strategic move. It’s not about fighting the CSS feature/function wars. Rather, it’s about capitalizing on the wisdom of crowds in the cloud, which could help companies gain more insight and save money in customer service. What could be more important in this economy?

Further Reading:

6 COMMENTS

  1. Hi Bob

    Very timely post. I see that Salesforce is powering Obama’s Change.gov Citizen’s Briefing Book.

    ZDNetg
    Salesforce.com Powers Obama’s Change.gov Citizen’s Briefing Book
    http://blogs.zdnet.com/crm/?p=115

    What a huge vote of confidence by the Obama’s team in Salesforce’s capabilities as a cloud computing platform.

    This is fantastic publicity of the sort money just can’t buy.

    Graham Hill
    Customer-driven Innovator
    Follow me on Twitter

  2. As you say, Salesforce.com is late to the CSS party and has much catching up to do. Recent outages on their service have companies concerned that trusting Salesforce.com with more business applications than Sales Force Automation will mean more of their company redundant when the service breaks, too.

    I also wonder what the 186 CSS vendors with applications listed in the Force.com AppExchange will be making of SFDC pushing itself to the front of the queue…?

    It’s also worth noting that I believe Salesforce.com only support Facebook as a social network at this time, whereas Twitter is probably the community to watch for news bad service experiences spreading quickly, as it’s much easier — and common practice — for “tweets” to get retweeted, passing the news on to hundreds more people with EVERY new person that hears.

    Ian Hendry
    CEO, WeCanDo.BIZ
    http://www.wecando.biz

  3. I asked Natalie Petouhoff, the Forrester analyst who covers the CSS market, for comments on the Salesforce.com announcement. Posted with permission from two emails received on Jan 20:

    Yes, ASP – SaaS – On-demand vendors have been around for the last 5-10 years… some of which started to offer on-demand customer service (CS) back in ~1998- case in point is eGain and RightNow.

    I think that what is new here, it not really that SFDC is offering CS via a SaaS model/ in the cloud… but that they are providing a SaaS platform for customer service that allows for the integration of other SaaS apps– like Facebook and Google.

    Without the common platform you’d have a customer service app and 2 other SaaS apps. All individually can provide value. But without a common platform so that they work together, you are just getting the individual values.

    But the futuristic thinking I think is that the SDFC platform provides the ability to take 3 apps and instead of 1 + 1 + 1 = 3 now you have 1+ 1 + 1 = 18…

    ie because one is able to use these apps on the same platform AND integrate the unique benefits each app offers, there is an exponential value you can’t get otherwise.

    Additional savings can come from email staff support reduction if the online community becomes a preferred interaction channel. Email is such a one-way channel, that most customers would prefer to interact in almost any other way.

    Customers can interact with experts in a web community forum or in a discussion between friends in Facebook or other social networks- places where customers already go frequently. If the customer service solution is a SaaS solution it is easier to plug into communities like Facebook and harness the collective wisdom of the “tribe.” If agents can also work in the “cloud” they too can have access to the community tribal knowledge and wisdom. Plantronics is pioneering this new cloud system to provide customers with solutions like these.

    ###

    Here’s a little more detail on what I see…

    Looks to me like a unique way to organize various SaaS solutions to serve the customer better… Here’s how…

    Let’s say a customer has a headset and they are having trouble with it. They might call the call center or look on the website for an answer. In the past, you’d have to read the manual, you’d call the call center or you’d asked your 10 year old nephew J. You’d be dependent on getting the right agent or hoping the website would have the right info for their particular headset. Using a unique combination of SaaS solutions in combination- salesforce.com + Facebook.com + google – the customer is provided with a community response that is more accurate, better researched and in many cases can’t be found any other way… i.e., its difficult for a headset company to test every single cell phone or land line phone for compatibility or other issues.

    But many times customers have solved the very problem another customer needs the answer to. Having customers answer each other questions saves in product dev, testing and customer service. Online community participants have often encountered the same issues many customers are experiencing, have resolved them and generously desire to share their knowledge with other customers. This invaluable, practical product solution information is rarely obtainable in any other fashion. It would take a product development lab—dozens of trial scenarios to garner all the issues and provide them as knowledge management content in their databases for use by their agents. This is impractical based solely, but not limited, on the continuous stream of new products and services.

    Thanks to Natalie for shedding some light on what this announcement means.

    Bob Thompson

  4. Greetings Bob

    I certainly agree that significant value can be had by tapping into the real world experiences of people using, designing, building and supporting a particular product or service.  What I don’t necessarily agree with is that using Google or directly searching through threaded discussions is an expeditious or prudent way to get accurate answers to pre-sales or post-sales questions.  That of course assumes that the company offering the product or service is using technology that quickly gets people to answers that they stand behind and that the answers are being continually evolved by the relevant community of people.  However, anything less than putting the community in the knowledge base will not deal with the inherent deficiencies of either KB or community content.  http://www.kb2dot0.com .

    Communities are indeed great places to get the real skinny on products, services and companies, and for having open-ended discussions and sharing ideas, but many times consumers want to avoid all the anecdotal commentary and get their questions quickly resolved.

    Companies also need to keep abreast of all communications impacting their brand, but they better also provide open communications and feedback channels directly into their organizations, which provides consumers with a place to surface their views and beyond merely ranting, expect to get fair resolution.  Online communities are here to stay and will only grow with the Gen Xers and hand-held devices. As much as possible, companies would be well served to bring the discussion within their own house.

    Thanks for stimulating thought beyond traditional lines.

    Chuck Van Court

    President and Founder, Fuze Digital Solutions

  5. Good point, Chuck.

    There’s gold in them there hills! If only you know where to look, and how to spot “fools gold.”

    I think a key challenge of “crowdsourcing” information is quality control. As I understand it, Salesforce.com uses a voting mechanism to try to highlight potentially more relevant info. The theory being if someone write a tip/suggestion/fix, and others find it useful and vote it up or rate it highly, then maybe it’s a candidate for information to be included in the formal KB.

    Of course, there are wackos out there with nothing better to do than try to game any system. Imagine a competitor putting a false tip about how to fix a product, then organizing a voting campaign to make it look popular.

    There’s a solution: real people with real brains and judgment.

    All that said, I see community knowledge as a way to leverage already overworked agents. Yes, I agree companies should try to establish their own communities, but why not also leverage the conversations outside the enterprise. But the key is how service managers, and the systems they use, vet the info to ensure what customers consume is correct.

    Bob Thompson, CustomerThink Corp.
    Blog: Unconventional Wisdom

  6. RightNow, one of the top guns in the “service in the cloud” space, had this to say about Salesforce.com’s announcement, in their Q4 2008 earnings call with analysts on Feb 4.

    Jeff Davidson (Chief Financial Officer, Treasurer)

    …they did a great job on the press release in the packaging. I would say that when we got under the covers what they announced is honestly a small subset of what we have been doing for years and as we get back, we look at what from market telling us about our solutions. They are asking for full multichannel support capability that includes integrated chat, email management, the phone channel, web self service all together so we can get one deal with a customer, as well as the voice applications and integrated feedback management. So, in the end as we did the analysis, it really does not change the competitive environment in any way and I just point also back to this Gartner chart that I referenced in my prepared remarks. I mean we are clearly the undisputed leader in this E-Service space.

    Source: Transcript of conference call by Seeking Alpha

    It’s worth noting that the “social” capabilities that Salesforce.com announced are easily matched by any competitor, because cloud services have open APIs that any vendor can use. SugarCRM just announced its cloud connectors this week, although more focused on information services (Hoovers, LinkedIn, Jigsaw) that add value for SFA.

    That said, it’s also worth noting that software industry wars are often won based on sales and marketing excellence, not features and functions.

LEAVE A REPLY

Please enter your comment!
Please enter your name here