Archive for June, 2008

June 26th, 2008

What’s the future for call centres?

For many years, even decades, call centres have been the primary recipient of response to consumer advertising campaigns. Throughout the 1990’s call centres were able to grow on the back of a strong growth in response-seeking advertising and marketing. In the last decades of the last millennium there was significant investment in call centres, technology and people.

However, as we entered the new millennium, the internet emerged as an alternative recipient of response. Now, as broadband penetration has increased to critical mass, online interactivity has become the norm and many companies are driving huge volumes of response to the internet. These developments open up a debate about the future of call centres with their significant costs in terms of buildings, communications, technology and people. Marketers are asking: What is the future of the call centre?

I found some interesting research on this topic from Forrester. Forrester asked 176 large US firms (turnover of $500m+) to forecast how the saw the way they interact with customers changing over the next two years.

The big gainers are web and email, whilst the big loser is call centres. 96% predicted a significant increase in the use of the web and 80% saw a significant increase in the use of email. Virtually no companies saw a reduction in these online interaction channels. At the other end of the spectrum 28% saw either a small or significant reduction in the use of call centres whilst only 17% saw significant growth prospects. Phone self service was tabled for a 69% increase suggesting that whilst these firms recognise that there are many consumers who still want to interact by phone, they are not necessarily prepared to pay for that to be a live conversation.

It looks as through live call centres are in for a tough time; they’ve lost their historical monopoly on non-retail interaction with the consumer. Companies are going to see very tempting cost savings in online interaction so they’re likely to encourage and invest in it. I think they’ll always be a role for live call centres, though much reduced and focused into the type of high value conversations that justify their relatively high costs. Live conversations are likely to be increasingly reserved for high value products, high value relationships and high value customers.

Forrester

June 9th, 2008

What is Web 2.0?

Requests for a definition of Web 2.0 are still made by clients - for some this is still a new subject. Here’s a summary of the points I recently used to describe Web 2.0 to an FMCG advertiser.

Web 2.0 is an inclusive phrase that covers the new web based networking, customisation and data management functionalities that have emerged since 2000. 2000 is a significant start point because it played host to two important events in the gestation of Web 2.0. First, 2000 was the year of the dotcom crash which, in an almost Darwinian sense, extinguished poor performing technologies and ideas and created the intellectual, technological and financial ‘space’ for something new. And second, 2000 was the year that Google began real take-off after receiving $25m of venture capital in 1999. This investment paved the way for Google to expand globally and redefine the way web information is catalogued, ordered and retrieved worldwide.

It’s important to note that the web as a technology platform remains largely unchanged, but in Web 2.0, the way that platform is being used has changed dramatically. Web 2.0 is about moving web content from being information on a news stand to being customised information solutions for individual needs. This individual customisation is the essence of Web 2.0. The guys who coined the phrase Web 2.0* cite a number of examples to illustrate how Web 2.0 is an evolution from Web 1.0. Here are two examples that really sum it up:

1) Encyclopaedia Britannica versus Wikipedia

Britannica was - and remains - an online encyclopedia written and researched by the Britannica editorial team. It’s a huge compendium of information, but it remains under the tight control of Britannica. Wikipedia on the other hand is open to editorial contributions from almost anyone at any time. It is therefore never the same across any two days. That makes it a living and evolving entity. Where Britannica is ice, Wikipedia is water. Britannica is Web 1.0 and Wikipedia is Web 2.0.

2) Personal Website versus Blogs

Personal websites are generally static and non-interactive. Content is uploaded, pages are then fixed and remain unaltered unless the webmaster decides to make changes. Change is cumbersome, requiring changes in HTML source code. Blogs on the other hand are a platform designed to have content updated frequently. New content can be posted every minute and uploaded from PCs or mobile phones. Readers can air their views by posting comments. Content can be emailed to others. Blogs can be “claimed” at Technocrati where all registered blogs are brought together in a searchable blog universe or blogosphere. Personal Web sites are 1.0 and blogs are Web 2.0.

Other ways of defining Web 2.0

There are other ways of defining Web 2.0. Think of drinking in a highly social pub rather than having a glass of wine at home alone. Think of videoconferencing rather than watching the TV. Think of CB radio with its network of “breakers on the side” rather than a one to one linear telephone call. Think in terms of the Internet versus the printing press or conventional TV versus You Tube. Web 2.0 is Facebook where 1.0 is a printed membership directory. Web 1.0 is one dimensional, non-network based, comparatively static and delivered to “mass” online audiences. But Web 2.0 is about being multi-dimensional, connected, highly dynamic and delivered on a customised one to one basis.

What are Web 2.0’s component parts?

Web 2.0 is many things and the list is potentially endless – there are already about 9m references to it in Google. Even the guys who defined Web 2.0 had to say “Web 2.0 doesn’t have a hard boundary, but rather, a gravitational core”. Here are some of our examples:

Blogs / Blogosphere
Broadband
Comments
Communities
Content
Databases
Democracy of information
Facebook
Google
Google Adwords and Adsense
i-Tunes and i-Pods
LinkedIn
Networking
Tags
The “People who bought this, also bought this” feature in Amazon (A web 1.0 survivor)
Technocrati
User Generated Content
Widgets
Wikipedia

These examples are component parts of a totally new media age. It’s a new form of media (indeed media may no longer be the right word) with a new set of rules, a new language, a new functionality and it’s a world that puts the consumer, as the scheduler, at its core.

* O’Reilly Media and MediaLive International