This is the keynote address from the July 17th, 2013 Becoming a Customer Company event. This was a co-sponsored event by Magnet 360, salesforce.com, and Marketo. This presentation includes slides as presented by Peter Coffee, Andy MacMillan, Scott Litman, and Jeremiah Owyang.

2. @PeterCoffee

3. • Old Customers:
• Prospects get content from Marketing
• Buyers negotiate terms with Sales
• Customers raise issues with Support
• Connected Customers:
• Prospects seek insights from customers
• Buyers collaborate on competitor research
• Customers tell the world when they’re not happy
• Companies need new organizations & processes
• Power to address issues pushed to edge of organization
• Collaborative response available on demand
Customers Today are Connected

4. Designing in services is now becoming commonplace,
making cloud integration expertise critical for
manufacturers.
•From simplistic services integration on iPhones to the full
implementation of voice-activated controls including emergency
assistance in the latest luxury cars, adding in services integrated to
the cloud is redefining the competitive landscape of industries
today.
•Revising a product or launching a new product generation with
embedded services can mitigate price wars, which is why many
manufacturers are pursing this strategy today.
TECH 5/06/2013
Products Today are Connected

5. • Connecting Machines
• ‘OnStar’ network daily handles 150k human requests…
…and 130k machine-originated requests
• Some are critical, e.g. air-bag deployments
• Others may be infotainment, e.g. mileage ‘leader board’
• Connecting Processes
• General Electric wind-farm management: 123 turbines
• Field-wide speed optimization, anti-icing behaviors
• 3% output increase → US$1.2M/year added revenue
• Connecting People
• Asics delivers RFID-triggered messages to marathoners
‘Cloud’ is a Medium of Connection

6. In This World of Connection…
• Everyone who works for you is your brand
• Service reps face customers more than salespeople
• Customers want to engage in product development:
Yes, your engineers may need to be customer-facing
• Merely “satisfied” customers aren’t enough
• We used to delight a prospect…
…and convert to a satisfied customer
• Now, brands with merely satisfied customers are invisible
• Delighted customers are your only credible marketers
• Service interactions are opportunities to re-enchant
• Collaboration is crucial to continuous delight
• Connected products give manufacturers knowledge of customer behavior
• Any team member may need immediate access to subject matter experts
• Mentoring, coaching & recognition need to be continuous and non-hierarchical

7. Connected Companies Win in the Cloud
• Customers: records become communities
• Employees: appraisals transform to collaborations
• Partners: supply chain grows into value network
• Financials: transactions evolve to scenarios
• Fighter pilot’s “OODA Loop”
“Observe, Orient,
Decide, Act”

8. @apmacmillan

9. /apmacmillan
@apmacmillan
in/apmacmillan
Andy MacMillan
Senior Vice President
Connect With Your Customers In A Whole New Way

10. Safe Harbor
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management for future operations, statements of belief, any statements concerning new, planned, or upgraded services or
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not intend to update these forward-looking statements.

11. The Customer Revolution

12. Today’s Platform Connects an “Internet of Things”
Terminal Client
Devices
Products
LTE
SNA
Mainframe
LAN/WAN
Server
Cloud
1,000,000,000s1,000,000s1,000s

13. The Customer Revolution
1960s
Mainframe
Computing
1970s
Mini
Computing
1980s
Client
Server
Computing
x 10x 100x 1,000x 10,000x 100,000x
2010s
Social
Revolution
1990s
Cloud
Computing
2000s
Mobile
Computing

14. Social
New ways
to connect
Trust
New ways to
build relationships
Mobile
New ways to
reach customers
Big Data
New ways to
discover insight
Community
New ways to
collaborate
Apps
New ways to
build apps
Cloud Computing
New ways to connect everything
New Ways To Connect With Customers

15. Social Revolution
Customer Companies Engage on Social Channels
Share Feeds, Profiles, Groups, and Files
4.5 Billion Aggregate Social Users

16. Touch Revolution
Touch & Local Aware Apps
Reach Customers Anywhere
1.7 Billion Touch Devices Shipped in 2012

17. Big Data Revolution
Collect Customer, Product and Usage Data
Gain Customer Insight
450 Billion Business Transactions / Day by 2020 (IDC)

18. Community Revolution
For Customers, Employees, and Partners
Private & Public Communities
Single Sign-on with Secure, Portable Identity

19. Ecosystem Revolution
Every Company is Building Mobile Apps
Customer Companies Use Apps to Interact with Customers
Requires a Customer Platform

20. Cloud Revolution
$111 Billion Industry in 2012
18% YOY Growth
Salesforce.com: #1 Enterprise Cloud Vendor

21. Cloud Revolution
Earn Customer Trust
Build Relationships on Equal Terms
Respect Privacy, Identity & Money

22. Companies are Disconnected from their Customers
Your Customers, Employees, and
Partners are Connected…
Is Your Company Connected?

23. How do you become a
customer company?

24. Become A Customer Company:
Connect With Your Customers in a Whole New Way
Connected
Products
Connected
Employees
Connected
Partners
Connected
Customers

25. Five Questions To Become a Customer Company:
1. How do you market to customers when they are everywhere?
2. How do you sell as a team with your customers?
3. How do you service customers when they are everywhere?
4. How do you build a customer platform?
5. How do you transform the way you work?
Connected
Products
Connected
Partners
Connected
Employees
Connected
Customers

27. @ScottMagnet

28. OUR MANTRA

29. DEEP EXPERTISE

30. ENGAGEMENT STRATEGY

31. SALESFORCE EXPERTISE

32. ITERATIVE DELIVERY

33. CLIENT TRUST EARNED EVERY DAY

34. WHO WE ARE
/// CLIENT TRUST EARNED EVERYDAY
/// CONSTANT EVOLUTION
/// RESPONDING WITH URGENCY
/// COLLABORATION
/// SHARED OWNERSHIP
/// ROCKIN
MINNEAPOLIS | NY
85+ EMPLOYEES

35. “THE ONLY SUSTAINABLE COMPETITIVE ADVANTAGE IS
KNOWLEDGE OF AND ENGAGEMENT WITH CUSTOMERS.”
-Josh Bernoff, Forrester Analyst
Competitive Strategy in the Age of the Customer

36. ENGAGEMENT QUADRANTS

37. ENGAGEMENT QUADRANTS

38. ENGAGEMENT QUADRANTS

39. @jowyang

42. Eras of the Internet

43. What role do corporations play
if people don’t need them?

44. The Collaborative Economy
An economic model where ownership and access are shared
between people, startups, and corporations.

45. The only way, is to let go
to gain more.

46. Is this a business
disruption?

47. Sharing Is Not New

48. Lyft enables crowd to be
transportation –avoiding taxis

49. AirBnb Enables Crowd to be a Hotel

50. LendingClub enables crowd to be a
bank

51. oDesk enables crowd to be a
workforce

52. Feastly enables your neighbors
kitchens to be a restaurant

53. Liquidspace enables companies to
rent from each other

54. Yerdle leverages Facebook connect to
build a trusted network to share products

55. StokeBox enables collections to be
shared for $5.

56. A properly shared car is
$270,000
Lost
Revenue
Of auto sales
(1 shared car = 9 cars
at average of $30k
each.)
56

57. Is this a passing fad?

59. Societal Factors
75% said they predicted
sharing of physical
objects and spaces will
increase in next 5 years
–Shareable Magazine Study

60. Population
Economic Factors
1975:
4 Billion
2050:
9 Billion

61. Technology Factors
• 87 phones per 100
people on planet
• Three quarters of
startups use social
tech like Facebook

62. A movement that’s only increasing
Out of 200 collaborative
economy startups, total
funding was over $2 billion
Of those funded, the
average was $29 million
(May 2013, Lyft raised $60m)

63. The sharing revolution is an
unstoppable movement

64. Collaborated with the Revolutionaries
64

65. What can you do?

66. Collaborative
Economy:
Value Chain

67. Collaborative
Economy:
Value Chain

68. 1. Company as a Service

69. Toyota as a Service

70. Razors as a service

71. Beauty as a service

72. Luxury Handbags as a Service

73. Mobility as a Service

74. Company as a Service Insights
• Companies must offer goods products
available on-demand.
• Rather than sell a product once –sell it
100 times
• To do this, focus on rental, subscriptions,
and memberships

75. Collaborative
Economy:
Value Chain

76. 2. Motivate a Market

77. ScotteVest enables second market

78. UK retailer M&S fosters Swhoping

79. Patagonia enabling second market
and altruism

80. Motivate a Marketplace Insights
• Companies must enable customers to
resell, swap, gift –not hamper it.
• Foster a new experience: peer to peer
relationships.
• Extract value from these new
relationships, value added services, or
take a cut from transactions.

81. Collaborative
Economy:
Value Chain

82. 3: Provide a Platform

83. Collaboration

84. Fund
Design
Develop
Co

85. Co-Fund new products like Kickstarter

86. Co-Design products like Nike

87. Co-Develop like Quirkly

88. Co-Customize Like Etsy

89. Co-Production with 3D Printers

90. Co-Storage of Products with Lockitron

91. Co-Deliver with Deliv

92. The Crowd Built a Car: Design,
Funding, Production, Assembly,
Wikispeed project enabled the crowd to build a 100mpg car

93. Provide a Platform Insights
• Reduce your operating expenses and
risk as the crowd gets involved –and
generates new value
• The highest form of loyalty is co-
ownership, as they champion your brand
• As the crowd becomes the company,
could the evolution of a corporation just
retain an ecommerce system and a logo?

94. Collaborative
Economy:
Value Chain

95. What will challenge us as we
move forward?

96. Opposing Market Forces Abound
1. Governments, lobbyists,
and institutions oppose
2. Buyers and sellers lack
complete trust
3. Fragmented startups in
every category
4. Uncertainty about which
startups will stand the test
of time

97. What are your benefits
for letting go to the
collaborative economy?

98. More efficient, as the crowd helps
you
1
2 A long-term relationship with
your vested customers
3
New value created between
people, means new revenues
4 If you act now, you will have first
mover advantage

99. Collaborative
Economy:
Value Chain 20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20% 20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%

100. Collaborative Economy Final Take-Aways
• The crowd turns to each other to get goods
and services –bypassing corporations
• The sharing revolution is an unstoppable
movement
• Solution: embrace the Collaborative
Economy Value Chain:
1. Company as a Service
2. Motivate a Marketplace
3. Provide a Platform

102. Let go of your company to
gain the market.

103. What side of history
will you be on?

104. Download Report:
http://bit.ly/collabeco
Jeremiah Owyang
Partner and Industry Analyst
Altimeter Group
@jowyang
web-strategist.com
jeremiah@altimetergroup.com

105. Collaborative Economy Glossary
Collaborative Economy (Model): An
Economic model where ownership and access is
shared between people, startups, and corporations.
Two sided Marketplace (Category): An
online website where buyers and sellers of goods or
services are sharing inventory, need, and transacting.
Example: Ebay, Craigslist, AirBnb, 99 dresses.
Transactions (Verbs): There are many types of
verbs that can be used in facilitation including: Buy,
Sell, Swap, Lend, Gift, Co-own, co-fund , buy and more.
Maker Movement (Trend): An emerging
trend where customers can self-design, create,
produce, and distribute products and goods on their
own.
Company as a Service (Strategy): Rather
than sell goods in the traditional sense, offer products
or services to customers on- demand or through a
subscription model. Rent, Subscribe, or Gift.
Motivate a Marketplace (Strategy): A
community around a brand enabling customers and
partners to resell or co-purchase products, swap goods
related to the brand, or even enable lending or gifting
for no monetary exchange.
Provide a Platform (Strategy): Corporations
that enable an ecosystem customers to build products
and new services as partners — not just consumers.
Online Reputation (Feature): Any number
of online features that store historical and current
information about social profiles, individuals network
connections, credibility, or reviews of previous and
predictable behavior.
Social Sign On (Feature): A technology
feature that connects websites with profile systems
from social networks like Facebook, LinkedIn or
Twitter connect enabling existing reputation, social
contacts, and social graph information

106. Credits: Research Interviews
Airbnb, Molly Turner, Public
Policy
Arbor Advisors, Dean Callas,
Investment Banker
Ariba, An SAP Company,
Joseph Fox, VP of Strategy
August Capital, David Hornik,
Investor
Bazaarvoice, Stephen Collins,
CEO
carpooling .com, Markus
Barnikel, CEO
Cisco, Carlos Dominguez, SVP,
Office of the COB and CEO
ConnectMe 360, Brian
Hayashi, Founder
Decide.com, Shauna Causey,
VP, Marketing
Enterprise Holdings, Ryan
Johnson,
WeCar AVPeToro, Yoni Assia,
CEO and Founder
eToro, Nadav Avidan, PR and
Communications Manager
eToro, Adi Yagil, Head of Social
Media
Gazelle, Israel Ganot, CEO
HomeExchange, Ed Kushins,
Founder
Jive Software, Christopher
Morace, Chief Strategy Officer
LiquidSpace, Mark Gilbreath,
CEO/Founder/Skipper
Lithium, Rob Tarkoff, President
and CEO
Lyft, Kristin Sverchek, General
Counsel
MuckerLab, William Hsu, Co-
Founder, Partner
Sasson Capital, Vivian Wang,
Venture Capitalist
oDesk, Gary Swart, CEO
oDesk, Shoshana Deutschkron,
Director, Communications
OuiShare, Antonin Léonard,
Co-Founder
Oversee.net, Gene Chuang,
CTO
PivotDesk, Alex Newman,
Director, Customer
Development
Sass.me and Oversee.net, Min
Chan, GM of Mobile
SCOTTEVEST, Scott Jordan,
CEO and Founder
Shareable Magazine, Neal
Gorenflo, Founder
Shasta Ventures, Rob
Coneybeer, Managing Director
Collaborative Lab, April Rinne,
Chief Strategy Officer
Collaborative Lab, Lauren
Anderson, Chief Knowledge
Officer
The Mesh, Lisa Gansky,
Author, The Mesh: Why the
Future of Business is Sharing
Zuora, Tien Tzuo, CEO
Zuora, Brian Bell, CMO
Deborah Schultz, Innovation
Strategist

107. The following people provided guidance, reviewed content, tested ideas, or most
importantly, challenged the thesis during the project:
David Armano, David Berkowitz, Richard Binhammer, Mel Blake, Erik Boles, Michael Brito,
Noelle Chun, Steve Farnsworth, Lyle Fong, Ian Greenleigh, Shel Holtz, Noah Karesh, Kevin
Kelley, Matt Krebsbach, Wendy Lea, Evelyn Lee, Geoff Livingston, Jacob Miller, Marcus
Nelson, Ben Parr, Jeff Richards, Andy Ruben, Jim Rudden, Ben Smith, Aaron Strout,
Carmen Taran, Rob Tarkoff, Ed Van Siclen, Mike Walsh, Sharon Weinbar, Adam Werbach,
Susan Williams, Vladimir Mirkovic, Anita Wong, and the entire Altimeter Group research
and consulting team.
We extend special appreciation to LeWeb founder Loic Le Meur who inspired Altimeter
Group to research this topic.
Credits: Research Input

108. Peter coffee

109. • If the cloud is only used to modernize IT, that’s all
that will happen – and it will not be enough
• Enormous improvement of connection enables
mobile as the norm; desk work as exception
• Mobile access enables in-the-moment inquiry and
action via networks of trusted advisors – some call
them ‘social’
• Machines, as well as people, are connected – and
even machines can be ‘social’ in key behaviors
• Decades of design have focused on documents
• Future of IT is in workflows. We call it “the feed.”
‘Cloud’ Must Mean More Than ‘Cheap IT’

110. “What You See Is What You Get”?
“What You See Is What You Need”
• What you’re doing
• Who else is doing it
• What’s already been done
• What you want to share
• What you want to show
• What you want to ask

111. Connected Computing Leaves the Desk Behind
• “Desktop metaphor” is 25
years old
• Xerox…
• Apple…
• Microsoft…
…but today,
1/3 of U.S.
adults own
at least one
tablet…
…and usually don’t use it at a desk

112. It’s Time to Make the Customer the Focus
• 1st
-generation computer: enter code with switches
• Think about memory and storage
• 1st
-gen operating system: “Load my program”
• 2nd
-generation computer: command-line window
• Think about programs and files
• 2nd
-generation OS: “EDIT MY_FILE”
• 3rd
-generation computer: desktop metaphor
• Think about ‘documents’ like spreadsheets
• 3rd
-generation OS: double-click an icon
• It’s time for the next generation
• A platform whose focus is…customers

113. @jowyang
@PeterCoffee
@apmacmillan
@ScottMagnet