Revenue, Loyalty and the Transformation of Support Services · Revenue, Loyalty and the Transformation of Support Services. Jim O'Neill, Research Analyst, Parks Associates. Josh Goldlust,

Revenue Loyalty and the Transformation of Support Services

Jim ONeill Research Analyst Parks Associates

Josh Goldlust Vice President Product Management PlumChoice Inc

Presenters

Presented by

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Recording DetailsSubject Parks Webcast - Revenue Loyalty and the Transformation of Support Services sponsored by PlumChoiceRecording URL httpswwwlivemeetingcomccparksassociatesviewRecording ID ZJKH36 Attendee Key 8`4zW2

Transformation of Support Services

An Influx of Devices in the Home

Presented by

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Consumers Add Complexity to Their Lives

4

23

11

5

20

8

4

16

24

24

11

Computer

Broadband modem

Home network

Printer

External hard drive

Streaming media player (Apple TV Roku etc)

Tablet

Flat-panel TV

Smartphone

Game console

A Wave of New Devices is Flooding US HouseholdsOver the past 12 months did your household start using a new

Source Parks Associates Consumer Researchcopy 2012 Parks Associates

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Ubiquitous Broadband in the US Creates Opportunity

bull More than 82 million households in the US currently have broadbandraquo Of those broadband HHhellip

ndash 36 of users use anti-virus software

ndash 15 say they use a cloud-based back-up service

ndash 8 have purchased extra warranties or replacement insurance for household electronics

raquo And theyrsquore looking to their service providers for helpndash One-third say theyrsquore interested in virus protection from their SP

ndash 31 Would be interested in a datafile backup from their provider

ndash 24 say theyrsquore interested in purchasing extra warranties and replacement insurance from SPs

5

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The Trials of Do-It-Yourself Installation

6

72

18

5 4

MyselfFriendFamily memberA technician that came to my homeA technician in a retail store or other location outside my home

Source Parks Associatescopy 2012 Parks Associates

Consumers Often do their own InstallWho set up the devices

12

29

11

33

15

It was broken or defective

Difficulty connecting it to the Internet

It did not work as advertised

Difficulty learning how to use it

Did not have all the required cables

0 10 20 30

Houston We Have a ProblemWhat problem did you have when setting

up the device

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Therersquos a Demand for Tech Support

7

66

10

8

6

11

0 10 20 30 40 50 60 70

Set up the device myself

Have a technician visit my home to set up the device

Contact a technician and work with them to set up the device

Allow a technician to set up the device by remotely accessing it through the Internet

Have a technician in the retail store set up the device at the time I purchase it

Turning to Tech Support for Help and HowIf 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)

How would you prefer to contact technical support

Phone 46 Face to face 26 E-mail 10 ChatIM 7

Source Parks Associatescopy 2012 Parks Associates

wwwplumchoicecom wwwparks associatescom

Therersquos a Need and Desire for Premium Tech Support

bull Opportunity in premium tech supportraquo Nearly 20 of consumers who bought computers in the past 12 months said tech

support and warranties influenced where they bought their computersndash 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

raquo 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

raquo 14 said they bought technical support for help in learning how to use their computer

8

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Poll Question 1

When considering customer paid support programs which would be your primary driver

raquo 1) Incremental revenue generation

raquo 2) Increasing customer loyalty

raquo 3) Product differentiation

raquo 4) Cost avoidance

raquo 5) I do not currently offer a customer paid support program

wwwplumchoicecom wwwparks associatescom

Josh Goldlust VP Product Management

bull More than 15 years of product management and custom product developmentraquo ATampT- Director of Product Development

raquo Neslab Instruments - developed custom OEM equipment for semiconductor fabrication equipment manufacturers

bull Manages the comprehensive PlumChoice product and services portfolio with the market in mind raquo Outsourced technology services for premium tech support or fully

managed IT services

raquo Software-as-a-service (SaaS) and software for delivering and automating support services

10

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Empowering customer relationships with technology

11

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Partnering with PlumChoice

12

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Use Case 1 Customer Loyalty

bull Company Regional Appliance and Electronics Retailer

bull Challenge Known for excellence in customer serviceraquo Tech support was only available in-store on a transactional basis

raquo Limited support capabilities which may result in loyal customers going elsewhere for service

bull Solutionraquo Solutions echo a common focus on customer satisfaction and loyalty

raquo Remote white-label premium technology services solution that expanded the support relationship Fix Install Teach

bull Benefitraquo Retailer now has the opportunity to build stronger and longer relationships with their customers

raquo Leapfrogged the competitorsrsquo support offerings towards building longer term loyal relationships

raquo Sales of tech support contracts and computers have increased increasing lifetime value of a customer

13

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Poll Question 1 ANSWER

When considering customer paid support programs which would be your primary driver

raquo 1) Incremental revenue generation

raquo 2) Increasing customer loyalty

raquo 3) product differentiation

raquo 4) Cost avoidance

raquo 5) I do not currently offer a customer paid support program

Increase customer engagement and valueC

UST

OM

ER E

XPER

IEN

CE

VALU

E

0TIME

3 Mo 12 Mo 24 Mo

TECHNOLOGY CARE

6 Mo 20 Mo

DEVICE

WARRANTY

POINT SERVICES CARE POINT

BREAK POINT

PoS

TOUCHPOINTSERVICE PROVIDER

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Poll Question 2

Based on what you know today how long do you expect it to take to launch a Premium Technical Support program

raquo 1) Within one month

raquo 2) Within three months

raquo 3) Up to one year

raquo 4) More than one year

16

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Use Case 2 Product Differentiation

bull Company Large Hardware Manufacturer

bull Challengeraquo Suffering from a commoditized product Lack of product differentiation

raquo Low product margins

bull Solutionraquo Launched a fully outsourced support solution in 90 days

bull Benefitraquo Offering premium technical support became the product differentiation

raquo Partner was able to delight their customers with an entire experience rather than just a product purchase

17

ldquoGood hardware is relatively easy to find Good product support is not The people were remarkable I mulled over what Irsquod do if it was a hardware problem and I needed a new machine I decided Irsquod try

another (hardware manufacturer name) machinerdquo

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Use Case 3 Revenue Generation

bull Company National Telco SMB Focused

bull Challengeraquo High churn rate on core product offerings

raquo Desired new recurring revenue offering to off-set core product declines

bull Solutionraquo Established and monetized support offering above and beyond existing offering and

capabilities

raquo Bundled support offering with core product

bull Benefitraquo $270 Million in revenue over 4 years

raquo New revenue sources from multiple sales channels

raquo Bundling multiple products keeps customers coming back

18

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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

raquo 1) Within one month

raquo 2) Within three months

raquo 3) Up to one year

raquo 4) More than one year

19

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In summary

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How to get started with a PTS offering

bull There are several primary drivers revenue loyalty differentiationraquo Support can be infused into all customer touch points

bull Program considerationsraquo Price points - what is a customer willing to pay and under what circumstances

raquo Packaging - bundles point of need proactive

raquo Delivery - through outsourced program or broader enablement of existing resources

bull Partner with the right providerraquo Experience and expertise

raquo Value focus

raquo Reputation for innovation

raquo Knowledge and use of technology

21

Thank You 15950 N Dallas Parkway Suite 575DallasTexas 75248

Office 9724901113Fax 9724901133

jimoneillparksassociatescom

Jim ONeill Research Analyst

Josh Goldlust VP Product Management

Office 8668113321

jgoldlustplumchoicecom