Customer Service Company and Product Update - 3Q2009
A Good 3Q2009 for Knowledge Management-Based Customer Service
By Mitchell I. Kramer, Sr. VP and Sr. Consultant, Patricia Seybold Group, December 10, 2009

NETTING IT OUT

3Q2009 was a good quarter for KM-based customer service.

Customer growth improved and good financial performance resulted for six of our ten suppliers. The other four suppliers were flat or down just a bit.

Product activity was very high in 3Q2009. There were new products or major new versions from Attensity Group, Consona CRM, eGain, InQuira, IntelliResponse, RightNow, and Salesforce.com. The hot product trends are integration of social media as both a customer interaction channel and a knowledge source and support for assisted-service.

From a company perspective, there were two major M&A items. RightNow acquired social networking provider HiveLive. KANA went private.

Four of our ten suppliers earned Customer Service Stars for 2Q2009: Consona CRM, IntelliResponse, RightNow, and Salesforce.com. All of them demonstrated strong customer growth and strong financial performance. All of them introduced innovative new products and new product versions.

KM-based customer service is positioned for a very good 4Q2009 and a strong 2010.

KM-Based Customer Service

3Q2009 was a good quarter for KM-based customer service. After a run of seven excellent quarters, growth in KM-based customer service slowed in1Q2009. Business rebounded in 2Q2009 and increased in 3Q2009 with improved customer growth and resulting good financial performance. In 3Q2009, there were many significant product announcements and two significant M&A events. Social media and contact center assisted-service are the important trends.

Customer Growth for Six of Ten Customer Services Suppliers

Customer growth and financial performance were up in 3Q2009 for six of the ten suppliers that we cover: Astute Solutions, Consona, IntelliResponse, nGenera CIM, RightNow, and Salesforce.com. For the other four, Attensity Group, eGain, InQuira, and KANA, customer growth and financial performance slipped only a bit. There were no major slips among the four, and all four had good customer growth quarters in 3Q2009.

Remember that both InQuira and KANA currently offer only on-premise deployments. Also, while both Attensity Group and eGain do offer hosted deployment, most of their customers have deployed on-premise. Inconsistent customer growth has been a characteristic of KM-based customer service suppliers who offer on-premise deployments as deals that slip out of quarters have significant impact on growth and performance. Given the improving economy and seasonally strong fourth quarters in software, we expect improved customer growth and financial performance for all four in 4Q2009.

iUSask iPhone Applications

© 2009 IntelliResponse, Inc.

Illustration. This illustration shows three screens of the iPhone application from IntelliResponse.

Social Networking

A key trend in KM-based customer service to include social networking as both a customer interaction channel and as a source of knowledge continues in 3Q2009 and into 4Q2009 with several new products and new product features that support social media.

• Attensity Cloud lets organizations monitor, analyze, and respond to customer conversations within social media and internally.

• eGain Social harvests the knowledge of experts on social networks and in communities. It also monitors social networks and communities and can create cases from their content.

• IntelliResponse for Facebook lets organizations deploy IntelliResponse on their Facebook Fanpages, enabling Facebook visitors to ask questions, receive the “one right answer” as well as related and suggested questions, top 10 questions, answer ratings, and session summaries.

• RightNow enhanced its Cloud Monitor to identify social influencers—individuals who tweet frequently and who have a broad base of followers—automatically. Also, Cloud Links Analytics lets you track and analyze click-throughs and unique views of Cloud Links, which are links to social network sites that are included in surveys and outbound emails.

• RightNow Social Experience provides social media and community capabilities and facilities for monitoring and analyzing the social Web. It’s a new feature in RightNow November ’09 that’s built on technology that RightNow acquired in its acquisition of HiveLive.

• Salesforce.com Service Cloud provides both case management and knowledge management capabilities. Two of its components, Salesforce for Twitter and Salesforce Answers, support social media. Salesforce for Twitter uses Twitter as a communications channel. Salesforce Answers Facebook as a communication channel and a knowledge source.

• Salesforce Chatter is an application that enables realtime communication and collaboration among the employees, the Salesforce.com applications, and the Salesforce.com data within an enterprise. Its communication is based on an infrastructure built on the Force.com cloud computing platform. The Chatter network can also include communication from Twitter and Facebook and from third-party and custom applications built on Force.com.

Social media can be a boon to customer service, helping organizations and their customers understand how customers are using products and services and about how they’re solving or working around problems with those products and services. It can help customers help other customers install and use products and service.

Assisted-Service and Contact Center Integration

Support for assisted-service is another hot area in KM-based customer service. Agents need to find answers and solutions on behalf of the customers who call contact centers. KM-based suppliers have recognized requirements for adding knowledge management capabilities to contact center software for improving agents’ capabilities to find answers and solutions and for helping SMBs deliver assisted-service.

• InQuira iConnect integrates InQuira’s KM capabilities with contact center software. iConnect Siebel Contact Center is available. iConnect for Genesys will be coming soon.

• RightNow Dynamic Agent Desktop, the assisted-service UI for RightNow Service provides graphical workflow capabilities, integration of external applications and processes, agent scripting, guided assistance, and contextual workspaces.

• RightNow announced a fully tested integration between the RightNow On Demand Agent Desktop and Genesys Customer Interaction Management suite using OpenMethods integration software.

• Salesforce.com and Cisco jointly announced Customer Interaction Cloud. Customer Interaction Cloud is a combined Software-as-a-Service (SaaS) and telephony “solution” that enables customer service organizations to host their contact centers in a combination of the Salesforce.com cloud and on a hosted multi-tenant Cisco switch. That is, an organization’s case management and knowledge management customer service applications, its call routing, call queuing, agent management, and CTI telephony applications, and the integrations between them are deployed off-site in hosted environments.

KANA Goes Private

In 4Q2009 before this report was ready for publishing, on October 27, KANA announced an agreement to sell its assets and liabilities to Accel-KKR, for a cash purchase price of approximately $48.9 million. Once the transaction is completed, KANA’s software and services business will operate as a privately held company under the KANA brand. The change doesn’t affect our coverage, but it will affect the level of public information that we’ll be able to obtain about KANA.

RightNow Acquires HiveLive

RightNow has addressed social networking requirements with an acquisition. On September 8, RightNow announced that it would acquire HiveLive, Inc., a social platform provider. The acquisition closed on September 16. Technology from HiveLive has become the RightNow Social Experience component of RightNow CX, the firm’s application suite.

Four Customer Service Stars for 3Q2009

Balancing customer growth, financial performance, and products, Consona CRM, IntelliResponse, RightNow, and Salesforce.com earned Customer Service Stars for 3Q2009. All of them demonstrated strong customer growth and strong financial performance. All of them introduced innovative new products and/or new product versions with significant improvements. Props to all four.

Companies and Products

Here are the KM-based customer service suppliers that we cover:

• Astute Solutions RealDialog

• Attensity Group E-Service

• Consona Corporation Consona CRM Knowledge Management

• eGain Service

• InQuira 8

• IntelliResponse

• KANA Service Solutions

• nGenera Customer Interaction Management Suite

• RightNow CX

• Salesforce.com Service Cloud

This Report

With this report, we continue our fifth year of quarterly updates on the products and companies in customer service. These updates focus on factors that are important in the evaluation, comparison, and selection of customer service products. More specifically, we examine these factors in our quarterly updates:

• Customer acquisition and customers growth

• Product activity

• Company activity including hiring

• Company financial performance

In our evaluations of quarterly performance, we want to see continuing customer growth, ongoing improvements in products, steady company viability, and good financial performance. We don’t want to change our evaluations based on a quarter’s news, but we do want to raise a red flag when that news deviates from a positive, multi-quarter trend, or to wave a green flag when that news is particularly good. When significant product and company events occur, we identify and highlight those that could have an impact on customer service products and technologies, suppliers, and the market landscape.

Note that these quarterly reports accommodate the fiscal years of suppliers that don’t run on the calendar year—IntelliResponse and Salesforce.com both have fiscal quarters that end a month later than calendar quarters. We wait for them every quarter.

Now, let’s take a look at 3Q2009 performance for each of our ten suppliers.

This report continues...