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Revisiting the value of Web self-service

Many organizations need to revisit the value and purpose of providing Web self-service as part of their CRM strategy.

I recently refinanced my home mortgage and came face to face with the state of online customer service and multi-channel CRM. In my experience, it still has a long way to go. Sure, my bank, which claims to have the -- largest online-banking customer base in the world-- had a nice enough Web site, and I could check all of my account activities and balances, but when I had a specific question about 25-year loans, I was out of luck. No way to ask the question online or even easily search for the answer. And even though I could start the application process online, I had to provide the same information again when I (finally) got someone live on the phone.

I suspect that my experience is hardly the exception. But why have so many companies dropped the ball when it comes to the online experience and providing practical, effective Web self-service capabilities to their customers? It's especially puzzling given the amount of time and money these same firms have spent automating their other channels and driving customers to the Web. Of course, while I was waiting in phone limbo to reach someone live at my bank, the recorded greeting kept telling me togo to their Web site for better service!

It's clear that many organizations need to revisit the value and purpose of providing Web self-service as part of their CRM strategy. The reasons are simple and time-proven: you have to be where your customers are, you can't ignore a cheaper way of doing business, and you have to anticipate what's next. Customers continue to embrace the Web, and certain demographic groups such as teens even spend more time online each day than they do watching television. About two-thirds of car buyers do research online before they buy a new car, with similarly compelling ratios for computers, electronics, homes, etc. On the support side, the Web has become an equally important channel for remote troubleshooting, user groups, downloading software upgrades, and more.

At the same time, the economics of serving customers online (for pennies) versus in person (hundreds of dollars), on the phone (tens of dollars), or even via email (a few dollars) would seem to be enough of an argument for companies to make Web self-service a top priority. Not to mention that if your customers can't find what they want, or get frustrated online, they are going to call/visit you anyway!

Fortunately, some companies get this. In fact there are a number of sites and vendors that have figured out how to address the key challenges of Web self-service (making the front end usable/friendly, but not goofy -- remember Microsoft Bob, simplifying technology choices, integrating to both structured and unstructured content, and providing a way to tune and "learn" over time what customers really want) while not breaking the budget.

One example is the Yahoo! finance site powered by iPhrase Technologies' excellent natural language technology. It's a simple interface, but seems to give you just what you are looking for, without a lot of false starts. Online commerce poster child/punching bag is another. An early adopter of sophisticated personalization techniques, Amazon has invested a lot in its front end -- and it continues to show. Some feel that the company will sink or swim based on its backend logistics. I say Amazon will succeed because it was one of the first to really invest in multi-channel CRM, and has always understood the purpose of Web self-service: keep customers happy and keep them coming back.

On the vendor side, the self-service segment of the CRM market remains a study in contrasts -- fragmented, yet established. It is technology-intensive, yet arguably most effective when the technology is hidden from the user. It's a space that intuitively the big players such as Siebel and PeopleSoft should own, but don't, and remains dominated by a handful of independent players and upstarts. It is also a space that has the potential to become the "next big thing," and even create the next Siebel or PeopleSoft. So who are the key players?

Companies like eGain, Firepond, HNC, Kana and Primus provide well-established Web self-service capabilities as part of larger product suites, and have their roots in the artificial intelligence (AI) field. Natural language search vendors Ask Jeeves and iPhrase have started to target the self-service segment as well. Other vendors from knowledge management (Autonomy) and e-commerce (Blue Martini) are also in the game. At the same time, Courion (identity management), ePeople (collaborative tech support), Motive (intelligent service), Native Minds (automated online assistants), (e-service) and others have had recent success offering specialized self-service solutions.

Who will win? In a study my firm is currently conducting on the state of the Web self-service market, we are surveying and analyzing more than 50 vendors in this space, many of whom have relationships with one or more of the big-name CRM providers. As the market grows and consolidates, these partnerships will certainly be an important factor in determining who will succeed. Other success factors include how well vendors package their products (its easier to sell solutions than tools), create consumer pull, and price their products relative to other CRM applications and solutions.

Regardless of the approach, with the potential for businesses to finally leverage the power of the online channel -- and the tremendous upside for the vendors that help make this possible -- Web self-service deserves a larger share of the CRM spotlight.

Over the past 15 years, Allen Bonde has been a McKinsey consultant, director at Extraprise and the Yankee Group, and AI researcher. He currently runs a management consulting firm focused on the CRM and other emerging technology markets ( Allen can be contacted at or 781-237-1533.

Join Allen Bonde, Chris Selland and 3Com's director of Web systems and strategy, Steve Olsen, as they discuss the real value of customer self-service. Learn how self-service helped 3Com, the future of customer self-service, implementation tricks and how self-service will affect you. Don't miss this roundtable discussion May 8th at 1:00 PM EDT.

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