thinking: relating- celebrating :-)

There is a major meltdown of customer service expectations taking place over the way the launch of the new 3G capable iPhones are being mis-managed in New Zealand this week.

Go over to iPhone data plan aggregation to read some of the debate (around 50+ comments so far on a site that management might actually read.)

There is also a firestorm over at various other tech and media sites which I don’t read myself but maybe you do.

The background issue is that mobile data is still too expensive for most people to use and even worse it still only runs at close to dial up speed according to the Check your coverage link - in my area here are the results (If it is very slow why does anyone actually care about data on a mobile phone?)

2G/2.5G coverage in your area - Best (Green graph)

“This location has a very strong signal, so you will definitely experience excellent quality for all services. Your mobile data connection will be as fast as a dial-up connection.”

The TV interview being referred to is  TV 3 Campbell Live here If you didn’t see it already you should.

While Mark may not have seen the exact plans referred to by John Campbell it is sophistry to imply that the management and marketing teams didn’t research all of the pricing models available and he was well aware that pricing comparisons would be made.

Vodafone then made a judgement call on pricing models and it has backfired in a big way.

A few weeks back much was made of new data plans also at Rods site see 1-a-day/ and apparently these plans simply don’t apply to the iPhone. Plan choices are very restricted and quite inflexible.

To quote Bruce Hoult (Comment by Bruce Hoult at 9:40 am on 9 July 2008)

“Also that “$1 a day” casual data rate Paul Brislen was so happy about a few weeks ago, where everyone in the thread was talking about “that will go well with the iPhone”? It seems the iPhone is the ONLY phone you can’t use those with. Vodafone’s iPhone FAQ clearly says that if you don’t buy a data plan then you can’t use the internet AT ALL, and that the $1 a day is not available. Wtf???”

My conclusion is that if you get an IPhone at present the only reasonable way to use it without major data expense is on the WiFi networks like CafeNet or Tomizone* if they are available in your area.

*Been trying to locate hotspots at Tomizone there is a google map like interface but it’s very clumsy and slow and really hard to use on an almost dead connection anyway.

It would be much easier if I could navigate to a city or even suburb and do my searching at that level.

Speaking of data speeds I have a more fundamental local problem. My existing broadband connection is almost dead.

The obvious culprit is school holidays and the fact that yootoob is way more interesting that most NZ television.

In fact my internet connection has slowed so much that I can even complete the recommended speed test. Try it yourself although that site may have crashed out (won’t work anymore on IE 7)but Firefox 3 is OK.

Have a look at this screen-shot. It is quite typical and this test eventually got timed out.

I won’t say at this point who my ISP is but let’s just say I’m making plans to get service from a different company. It has simply been too hard to upgrade to ADSL2.

I can still get speeds of up to 1mb during the day at up to 3mb at midnight but that is not terribly useful when most of my work involves accessing web based software applications.

If you look closely the test immediately before this one got to a download speed of 1.7mb downstream which is sad but usable.

On a brighter note: If you are one of the 5000 or more people in NZ who already have an iPhone (or an iTouch) for that matter can you please tell me how this blog site looks on your screen.

I’m running a series of filters that are meant to detect iPhone / iTouch and display accordingly.

Hopefully it works and normal internet speeds will be restored soon but switching suppliers is not an easy thing. It seems like a huge opportunity for customer service people to excel and I hope they do.

(TBC in a later instalment.) Hope and trust your day is going better.

Update 6pm: Telecom announces a new 3G broadband device which looks promising on many levels. Maybe number portability could work in teh opposite direction and telecom will get lots of new customers from this.

“Telecom’s 3G mobile broadband network was upgraded with rev a technology last year which means Telecom’s cell sites now have the ability to deliver average download speeds of 800Kbps and 300Kbps upload, resulting in an experience much closer to DSL broadband on customers’ mobile devices.”

Now higher data speeds and capped rates with SMS warnings and a 30 day money back consumer protection all sounds like a breath of fresh air. I never thought I be pleasantly surporsed by a new Telecom product but I am.

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There is a great deal of hype around software as a service (or SAAS) at present. If you need help with sorting the hype from the useful content and want to know how we might be able to help keep reading.

If you have already got it all sussed click here to reward yourself with a free tshirt and check back soon for the next post.

Products
In most businesses a combination of software product + applied services + sustainable sales and marketing disciplines are needed in order to succeed.

Software
We have used and experienced a very wide range of CRM & ERP related products and vendors over the past decade and can help you assess the strengths and weaknesses of the products you may be considering.

For most projects there is no single right answer as you often have to leverage existing investments in other systems which is one way we can help with independent review and analysis of the options and combinations.

Increasingly it is the interface and interplay between front of house systems like CRM, websites, email marketing, RSS and blogging platforms where we see huge potential for a holistic best practice customer relationship focus.

Knowing a wide range of software products very well will help us ask the right questions on your behalf, if you would like help with product selection or ongoing project implementation. There are also some newer products becoming available that we can also introduce should the opportunity be suitable.

Services as a Product or SAAS*
It seems everywhere you look now there is a new “*software as a service” product. Essentially these are services developed as self service style products with pricing and self drive options for the savvy and lots of new complexity for the software consumer.

Ultimately for smaller and medium sized businesses SAAS offers the potential to outsource some IT needs and avoid most of the back room technical issues.

For CRM or marketing activities there maybe strategic implications. In the early days many of us were nervous about customer records being held at a remote data centre but ironically they are often more secure there that in the “back room” at most businesses.

What has now happened with SAAS is that there now more choices of service based products but the actual project complexities don’t go away. There is a still a great need for configuration, customisation and alignment of business processes and software frameworks.

The temptation by vendors has been to downplay the technical side and oversell the pricing model of x services for y$ per user per month or some variation of that formula.

The flipside is that many SAAS vendors are still working on their business models and the reality is that extra expert services still need to be budgeted for if you are to have a successful project.

Some vendors have also confused online distribution for online marketing and sales. For example just because you offer an online application or service doesn’t mean you don’t have to invest and pay sales and marketing staff.

Somewhere in the pricing equation there has to be a budget to pay for the real and hidden costs of not doing the job properly. This also applies even and especially if you decide to use open source software.

At DialogCRM we specialise in practical ways to best use and fully utilise those products and/or services that help with developing the best customer facing results.

We can work alongside your current team or partners to provide independent product review and analysis and or implementation services as well if there is a need to fill the product / skills gap.

For many business projects selection of a product or supplier is seen as the end when it is really only the beginning. Every system lives or dies on how well your staff and culture articulate and maintain sustainable relationship strategies and desciplines.

We also have the capability and methodologies to discover and enhance the thinking that best serves your business and turn those ideas into action. To read more about crm strategy…

A few weeks back Microsoft paid a large sum for a very small slice of Facebook. There has been a lot of commentary but this post makes the most sense and includes some very good underlying reasons for that deal.

For some earlier discussion see Microsoft & Facebook on Rods blog. And over here on the valuation implications More on the MS/Facebook deal which quoted Nicholas Carr.

My comment at the time was: (It seems like the deal is much more about the advertising rights than anything else. This paragraph below is a direct quote from one of the news.com reports.)

“In a conference call on Wednesday afternoon with press and analysts, Van Natta and Kevin Johnson, Microsoft’s president of platform and services, emphasized that this deal is all about the existing advertising partnership between the two companies, which has been going on for over a year now. Facebook founder Mark Zuckerberg, it should be noted, was not present on the call.”

However Marc Lehmann* has absolutely nailed it in his excellent post on the topic -Facetime with Facebook Bought Cheap. You should read his whole post - it is so good I wish that I wrote it.

(Marc is Founder of Saasu.com - and previously a Debt/Equity Trader at Deutsche Bank.)

Marc notes about 10 of benefits this deal achieves for Microsoft.

• Buys probably the equivalent of 10’s or possibly close to 100 million dollars worth of PR. Online, paper and TV. Screen real estate for 3 months as people speculate. So their Facebook spend isn’t 260mio already it’s a lot less.
• Wash Facebook brand onto Microsoft’s brand.
• Makes it easier for Microsoft to buy a blocking stake later. They already have a start now.

These are just the first 4 -read the rest of his list. And even better -this paragraph near the end.

And the best M&A trick of all is…
Microsoft pays up for the first chunk, then the seller/victim re-benchmarks price in their mind and any suitors that come along look cheap and nasty.

As a result new suitors say no to Facebooks attempts to get some price tension. The new suitors don’t even try. Then all of a sudden Facebook is left with their initial investor who has only bought a small percentage.

Time passes, more time passes and Facebooks business model of low cash and high cost is starting to show particularly as the US economic slowdown hits. What do you know Microsoft does not want to pay the same price any more.

There is a much bigger story on the Microsoft / FaceBook deal as Marc highlights extremely well.

Blog Note: If you spotted that my post frequency has been down lately - here is what happened. WordPress completed not 1 but 2 version upgrades (now at 2.3.1) recently and I thought my upgrade processes were at fault. Consequently have rebuilt the entire blog not once but 3 times!

After hours of testing on mirror sites and the live version finally concluded that at least one of my plugins was at fault. Today I found out which one that is - have now fixed the problem and there will be some catch-up posts including one on WP plugins and how you can maybe save some time if you have WordPress and run into similar issues.

Highrise Contact Manager will be one to watch out for because its a 37signals product.

37signals are proud of the fact that their products “do less than that of the competition”. They are most famous for Basecamp (Project management and collaboration) and Ruby on Rails which is an open source development framework.

The 37signals product philosophy is to “focus on executing the basics beautifully”.

To quote:

“Yesterday 37signals founder Jason Fried posted about the team’s upcoming contact management app called Highrise. The goal of the app is to help you manage contact information in a better way than relying on post-its or your current software-based customer relationship management (CRM) tool. Think of it like a Rolodex but with collaboration and more space to write things down. Many people can have access to the same records at once, and from the announcement, 37signals thinks they can do better than your current CRM. In many ways Highrise is a solution for a problem with Web communication technology: we have these great contact management tools with services like Gmail, Yahoo Mail, and Plaxo to bring them all together, but no way to share them, and add notes or related items. There are a few Web based CRMs out there, like Funclient and absoluteBUSY, but none that have the potential to tie into a suite of highly successful Web apps (see Basecamp and Writeboard). I can also see a big use for this for keeping track of friends or colleagues as they move all over the place, more so than relying on LinkedIn or social networks like MySpace and Facebook. Fried made no mention of pricing or a release date in the Highrise announcement, but noted that the 37signals team is “very happy with it.” We’ll post a hands on as soon as we get our mitts on it.”

From Original Signal (Webware)

And in a direct post from Fried on the product.

Highrise is a shared contact manager that helps you keep track of who you talk to, what was said, and what to do next. Like Basecamp helps you collaborate on projects, Highrise helps you collaborate on people. You can use it alone or with your co-workers. You can think of it as a company-wide, web-based, shared address book with a few twists.

For some clues on what the point of difference is Fried also comments later in the post:

Chris: Highrise won’t have pipeline reports or any numbers. It’s not a CRM tool in the traditional sense. It’s a lot closer to an address book than something like Salesforce.com.

Just as Basecamp doesn’t have traditional project management staples such as Gantt charts, Highrise doesn’t have traditional CRM tools like sales pipeline reports or charts.

Highrise is about people, communications, conversations, and tasks. It’s not about numbers.

Traditionally CRM has been very focussed around salesforce automation and more recently with marketing automation and services delivery systems. The usual defining split between a contact manager and CRM has been that CRM is more about process and workflow.

It is a very crowded application space although some niches are still available - like business on the mac. This product may suit those who are also looking at Daylite for example.  The product is separate from Basecamp and the other 37signals applications although potentially some linking between them would be desirable.

However - in my view any disconnected application “island” needs to be very, very good to justify the need for a new product.

I’m looking forward to fresh thinking in the area. Also wondering how this will compare to Daylite which seems to be a mid ground system that allows easy linking with mac. CRM is a collaboration strategy designed to be shared space. The “right” software always helps but is only part of the equation.

So far 37signals have shown they know how to deliver products which are simple, clean and easy to use which means that Highrise is one to watch…

What is important in the numbers is the overall upwards trend and growth curve.      Support from customers for “software as a service” is certainly there in a big way. The details come from a company press release dated August 16 and are for the period ended July 31, 2006. Some accounting gibberish has been edited out so this excerpt is not complete and is only to illustrate the big picture.

That is web based services (especially for CRM) are here to stay.

Revenue: Total revenue was $118 million, an increase of 64% on a year-over-year basis and an increase of 13% on a quarter-to-quarter basis. Subscription and support revenues were $106.7 million, an increase of 63% on a year-over-year basis and an increase of 13% on a quarter-toquarter basis. Professional services and other revenues were $11.5 million, an increase of 82% on a year-over-year basis and an increase of 13% on a quarter-to-quarter basis. 

Customers and Paying Subscribers: Net paying subscribers rose approximately 57,000 during Q2 to exit the quarter at approximately 501,000 total subscribers. This ending total represents an increase of 63% from Q2 of the prior year, and an increase of 13% from the prior quarter. Customers rose approximately 2,100 during the quarter and totaled approximately 24,800, an increase of 47% from Q2 of the prior year, and an increase of 9% from the prior quarter.
 
Full Year FY07: The company today is raising its revenue outlook for its fiscal year 2007, and now expects full year revenue of approximately $488 million to approximately $493