Is Customer Support a Revenue Winner for Search Vendors?
February 26, 2011
In a word, “Maybe.” Basic search is now widely available at low or
InQuira has been a player in customer support for a number of years. The big dogs in customer support are outfits like RightNow, Pega, and a back pack full of off shore outfits. In the last couple of weeks, we have snagged news releases that suggest search vendors are in the customer support business.
Two firms have generated somewhat similar news releases. Coveo, based in Canada, was covered in Search CRM in a story titled “2011 Customer Service Trends: The Mobile Revolution.” The passage that caught our attention was:
The most sophisticated level of mobile enablement includes native applications, such as iPhone applications available from Apple’s App Store, which have been tested and approved by the device manufacturer. Not only do these applications offer the highest level of usability, they allow integration with other device applications. For example, Coveo’s mobile interface for the company’s Customer Information Access Solutions allows you to take action on items in a list of search returns, such as reply to an email or add a comment to a Salesforce.com incident. Like any hot technology trend, when investing in mobile enablement it is important to prioritize projects based on potential return on investment, not “cool” factor.
Okay, mobile for customer support.
Then we saw a few days later “Vivisimo Releases New Customer Experience Optimization Solution” in Destination CRM. Originally a vendor of on-the-fly clustering, Vivisimo has become a full service content processing firm specializing in “information optimization.” The passage that caught our attention was:
Vivisimo has begun to address the needs of these customer-facing professionals with the development of its Customer Experience Optimization (CXO) solution, which gives customer service representatives and account managers quick access to all the information about a customer, no matter where that information is housed and managed—inside or outside a company’s systems, and regardless of the source or type. The company’s products are a hybrid of enterprise search, text-based search, and business intelligence solutions. CXO also targets the $1.4 trillion problem of lost worker productivity fueled by employees losing time looking for information. “All content comes through a single search box,” Calderwood says, “which reduces the amount of time to find information.” CXO works with an enterprise search platform that indexes unstructured data, and a display mechanism that uses analytics to find the data. It sits on top of all the systems and applications a company can have—even hosted applications—and pulls data from them all. It can sync up with major systems from Remedy, Siebel, SAP, Oracle, Microsoft, Salesforce.com, and many others.
So, customer support and customer relationship management it is.
Promises are easy to make and sometimes difficult to keep. Source: http://dwellingintheword.wordpress.com/2009/12/29/172-numbers-30-and-31/
I have documented the changes that search and content processing companies have made in the last year. There have been significant executive changes at Lucid Imagination, MarkLogic, and Sinequa. Companies like Attensity and JackBe have shifted from a singular focus on serving a specific business sector to a broader commercial market. Brainware is pushing into document processing and medical information. Recommind has moved from eDiscovery into enterprise search. Palantir, the somewhat interesting visualization and analytics operation, is pushing into financial services, not just government intelligence sectors. There are numerous examples of search vendors looking for revenue love in various market sectors.
So what?
I see four factors influencing search and content processing vendors. I am putting the finishing touches on a “landscape report” in conjunction with Pandia.com about enterprise search. I dipped into the reference material for that study and noted these points:
- Repositioning is becoming a standard operating positioning for most search and content processing vendors. Even the giants like Google are trying to find ways to lash their indexing technology to words in hopes of increasing revenue. So wordsmithing is the order of the day. Do these firms have technology that will deliver on the repositioned capability? I am not sure, but I have ample evidence that plain old search is now a commodity. Search does not generate too much excitement among some organizations.
- The niches themselves that get attention—customer support, marketers interested in social content, and business intelligence—are in flux. The purpose of customer support is to reduce costs, not put me in touch with an expert who can answer my product question. The social content band wagon is speeding along, but it is unclear if “social media” is useful across a wide swath of business types. Consumer products, yes. Specialty metals, not so much.
- A “herd” mentality seems to be operating. Search vendors who once chased “one size fits all” buyers now look at niches. The problem is that some niches like eDiscovery and customer support have quite particular requirements. Consultative selling Endeca-style may be needed, but few search vendors has as many MBA types as Endeca and a handful of other firms. Engineers are not so good at MBA style tailoring, but with staff additions, the gap can be closed, just not overnight. Thus, the herd charges into a sector but there may not be enough grazing to feed everyone.
- Significant marketing forces are now at work. You have heard of Watson, I presume. When a company like IBM pushes into search and content processing with a consumer assault, other vendors have to differentiate themselves. Google and Microsoft are also marketing their corporate hearts into 150 beat per minute range. That type of noise forces smaller vendors to amp up their efforts. The result is the type of shape shifting that made the liquid metal terminator so fascinating. But that was a motion picture. Selling information retrieval is real life.
I am confident that the smaller vendors of search and content processing will be moving through a repositioning cycle. The problem for some firms is that their technology is, at the end of the day, roughly equivalent to Lucene/Solr. This means that unless higher value solutions can be delivered, an open source solution may be good enough. Simply saying that a search and retrieval system can deliver eDiscovery, customer support, business intelligence, medical fraud detection, or knowledge management may not be enough to generate needed revenue.
In fact, I think the hunt for revenue is driving the repositioning. Basic search has crumbled away as a money maker. But key word retrieval backed with some categorization is not what makes a customer support solution or one of the other “search positioning plays” work. Each of these niches has specific needs and incumbents who are going to fight back.
Enterprise search and its many variants remains a fascinating niche to monitor. There are changes afoot which are likely to make the known outfits sweat bullets in an effort to find a way to break through the revenue ceilings that seem to be imposed on many vendors of information retrieval technology. Even Google has a challenge, and it has lots of money and smart people. If Google can’t get off its one trick pony, what’s that imply for search vendors with fewer resources?
It is easy to say one has a solution. It is quite another to deliver that solution to an organization with a very real, very large, and very significant problem.
Stephen E Arnold, February 26, 2011
Comments
-
- Subscribe to Beyond Search
Feature archive
News archive
-
