Case Study: Bonobos Uses Social Media to Grow Revenue 65 Percent
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1 Case Study: Bonobos Uses Social Media to Grow Revenue 65 Percent Jennifer S. Beck Distinguished Analyst and Gartner Fellow Jenny Sussin Principal Research Analyst
2 Lead Author Jennifer S. Beck, Distinguished Analyst and Gartner Fellow, Jennifer Beck serves digital marketing leaders, specializing in multichannel marketing across digital and offline channels. She offers advice to CMOs and CEOs on how to competitively position their companies, create and manage their brands, enter the digital arena, and maximize marketing and sales investments. Top 5 Issues That I Help Clients Address: How can marketers manage their brand through multiple digital channels? How can marketers develop and manage paid, earned and owned channels? How can marketers build programs and select technologies that maximize their investments across both digital and traditional marketing channels? What are the most critical considerations for designing and executing successful multichannel marketing campaigns? What models, tools and skills are essential to effectively manage and measure a multichannel marketing program? Additional Analysts Richard Fouts Michael McGuire Andrew Frank Laura McLellan Bill Gassman Director Adam Sarner Director Yvonne Genovese Managing Jake Sorofman Research Director Julie Hopkins Director Allen Weiner
3 Case Study: Bonobos Uses Social Media to Grow Revenue 65 Percent Published: 22 August 2012 Analyst(s): Jenny Sussin, Jennifer S. Beck G Bonobos, a clothing retailer, used social media to grow its revenue 65%. It used a practical system to manage customer service while supporting marketing campaigns. Bonobos' best practices can help your multichannel marketing efforts. Analysis Digital marketers can't avoid it. Almost everyone will have to have a social media strategy in their digital marketing tool box. Say you engage customers through Facebook or Twitter, or some other social site. Are you prepared to handle the issues that customers communicate through those channels? If you're not, your customers will grow frustrated at your lack of response, and they will turn social media into a megaphone to tell the world about it. An up-and-coming retailer avoided these problems by implementing a social customer service solution before it launched a social media effort. Implement the best practices that this retailer used to succeed with social media. Challenge technical involvement it hasn't needed a single hour of development or technical work since then. Bonobos was then able to escalate customer service and marketing inquiries based on rules so that they were handled quickly. The operations and experience team, referred to as "ninjas," had an easier time with case management because they could click a button and add a rule that says, "Any tweets with derogatory words get escalated." All ninjas work from the same queue as Twitter, Facebook and inquiries, but when they log in, the inquiry dashboard displays the inquiries that best fit their expertise. They can also forward requests for assistance to other employees for additional support. The tool is easy enough to use that employees outside customer service and support ("white belt ninjas") can work three to four hours a month to assist with service and support. White belt ninjas are rewarded with an invitation to a monthly happy hour after work and professional credibility among peers. The Desk.com solution allowed Bonobos to ramp up its marketing outreach beginning in 1Q11 with: Short-term promotions advertised via Twitter Contests Crowdsourcing new names for new products Bonobos uses the free version of HootSuite for campaign management. It allows: Shared corporate account access Scheduled tweeting and posts to Facebook Simple URL click analytics Table 1 compares the way Bonobos handled customer service with its three set of tools. Bonobos, a fast-growing men's clothier from New York City, sells directly to style-conscious consumers via its website. Bonobos has 50 employees. The company wanted to use Twitter and Facebook to run contests, promotions, questions of the day, and so forth, but it recognized that it first needed to improve its capacity for social customer support. It couldn't afford to hire extra staff to handle the extra inquiry and comment load, Bonobos first chose a peer-recommended best-inclass solution and implemented it in a few weeks but discovered it couldn't upgrade the solution or even make minor tweaks, because of the cost. Many of the CRM processes were still manual, and Bonobos' customer service and support agents had trouble handling case management with the application. Bonobos needed a different technology, with a customer service dashboard that could integrate with social channels and allow for shared workloads. Bonobos needed to find a new, more amenable, collaborative solution to take care of its clients on social channels to begin its social marketing initiatives Approach The minimal time to value convinced Bonobos to buy it. The company identified a new solution in Desk.com, which one employee was able to configure and customize in one night without any Page 2 of 6 Gartner, Inc. G
4 Table 1. Bonobos Customer Service and Support Evolution in Five Tasks Customer Service Task Assign Cases Set up a Follow- Up for a Case Pre-CRM Tools With Initial Tool With Desk.com Manager prints screenshots of service inbox and highlights subjects on copies of screenshots to assign tasks to employees. Employee creates an event in his or her individual employee calendar and enables alert. Shared inbox allowed for cases to be marked as complete, but did not indicate whether someone had responded, so multiple responses were being sent. Case reopens at a date set by employee and re-enters queue. Includes note about what to do with the case for next employee seeing it in queue. Shared queue, allowing employees to see open cases. Once a case is opened by an employee, other employees can see it and move on. Case reopens at a date set by employee and reenters queue. Includes note about what to do with the case for next employee seeing it in queue. Customer Service Task Source: Gartner (August 2012) Results Pre-CRM Tools With Initial Tool With Desk.com screen shots and passing them out to employees. agents and new rules can be created immediately. Bonobos went from having 10% of its staff involved in customer service and support to having almost 50% of its staff certified as white belt ninjas. Visibility into a shared queue and automation resulted in: Going from 50% of inquiries handled in under an hour to 75% handled in under an hour. Going from 75% of inquiries handled in under an hour to over 90%, based on tweaks done following Desk.com-administered survey results. Handle Twitterand Facebook- Based Inquiries Log in Twitter accounts or Bonobos on Facebook to look for mentions. Employees use best judgment in figuring out which are new and require responses, or manually pair incoming mentions with outgoing posts. Same as previous; Log in Twitter accounts or Bonobos on Facebook to look for mentions. Employees use best judgment in figuring out which are new and require responses, or manually pair incoming mentions with outgoing posts. Twitter and Facebook mentions flow into queue, as with . Everything handled in same workflow. The new solution enabled Bonobos to expand from handling inquiries and customer-service cases to marketing and operations. The retailer acquired new customers via social media, and current customers who had never given feedback to the company reached out through their channel of choice: In two months, Bonobos doubled fans and followers on Twitter and Facebook. Interactions via Twitter increased from 5% to 14% in six months. Interactions via Facebook increased from 5% to 11% in six months. Web traffic from social channels increased 215% from 1Q11 to 2Q11. Address Customer Issues With Merchandise, Site or Operations Teams Update the Administrative System Employees send to members of these teams directly or forward relevant s. No automated way to track stats on frequently mentioned pain points. There was no administrative system, other than printing the Same as previous; Employees send to members of these teams directly or forward relevant s. No automated way to track stats on frequently mentioned pain points. System needed provider's assistance to update, requiring consultation and development time. Each case has a check box asking if the case is a pain point. Employees can check the box, select which team it applies to and finish the case. Department teams still receive alerts about pain points, and can choose to view cases individually or log in to Desk.com to see pain point stats per department by week. Initial administrative setup was done by one Bonobos employee. New Revenue increased by 65% after the new solution adoption. The increase in active fans, followers and engagements via social media directly correlated to an increase in traffic on the Bonobos website. Thus, sales opportunities increased. Bonobos now faces these challenges: The order management system is not merged with the customer service and support record. With limited technical resources, Bonobos chose a manual work-around: an administrative rule in Desk.com enables employees to pull a link from a customer's sales cart into the Desk.com window. Bonobos wants to upgrade its shopping cart before integration so as not to duplicate work. Bonobos decided to archive but not integrate the data from its initial CRM tool so that it could be accessible. The retailer started fresh with Desk.com mainly due to limited technical resources. As business picks up, Bonobos will need additional resources all around. White belt ninjas have limited capacity because they are still meeting the requirements of their primary roles. Gartner, Inc. G Page 3 of 6 Page 4 of 6 Gartner, Inc. G
5 Critical Success Factors Bonobos has an adaptive culture that is willing to try new things. Bonobos recognized that, in social CRM, providing customer service is a necessary foundation before marketing initiatives can succeed. The new solution's ease of use allowed for the expansion of customer service assignments to Bonobos employees outside the customer service and support team. What to Do Next Know your company's pain points before searching for technology providers. Just because an offering has won a series of accolades doesn't mean it is right for you. Plan social CRM strategies for customer service and marketing in tandem, and create a shared workspace. Since the social CRM market is immature, go with a niche solution that directly addresses a business need rather than try to integrate a complete CRM suite. Balance experimentation and rapid adoption with integration requirements for delivering broader support for multichannel customer service. Be prepared to change as social media changes. Ask your provider what future costs are associated with tweaking a solution so that you don't go bankrupt staying modern. Regional Headquarters Corporate Headquarters 56 Top Gallant Road Stamford, CT USA European Headquarters Tamesis The Glanty Egham Surrey, TW20 9AW UNITED KINGDOM Asia/Pacific Headquarters Gartner Australasia Pty. Ltd. Level 9, 141 Walker Street North Sydney New South Wales 2060 AUSTRALIA Japan Headquarters Gartner Japan Ltd. Atago Green Hills MORI Tower 5F Atago, Minato-ku Tokyo JAPAN Latin America Headquarters Gartner do Brazil Av. das Nações Unidas, andar World Trade Center São Paulo SP BRAZIL Recommended Reading Some documents may not be available as part of your current Gartner subscription. "Social CRM: How a $5,000 Investment in Social CRM Yielded $440,000 in Sales" "Hype Cycle for CRM Customer Service and Support, 2012" "Case Study: Social Initiative Dramatically Improves a Company's Customer Support and Profitability" 2012 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of Gartner, Inc. or its affiliates. This publication may not be reproduced or distributed in any form without Gartner s prior written permission. The information contained in this publication has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information and shall have no liability for errors, omissions or inadequacies in such information. This publication consists of the opinions of Gartner s research organization and should not be construed as statements of fact. The opinions expressed herein are subject to change without notice. Although Gartner research may include a discussion of related legal issues, Gartner does not provide legal advice or services and its research should not be construed or used as such. Gartner is a public company, and its shareholders may include firms and funds that have financial interests in entities covered in Gartner research. Gartner s Board of Directors may include senior managers of these firms or funds. Gartner research is produced independently by its research organization without input or influence from these firms, funds or their managers. For further information on the independence and integrity of Gartner research, see Guiding Principles on Independence and Objectivity on its website, ombudsman/omb_guide2.jsp. Gartner, Inc. G Page 5 of 6 Page 6 of 6 Gartner, Inc. G
6 Why Gartner? Gartner helps companies improve their business results through the use of technology. Our independent research and advice is trusted by business and technology leaders in 13,000 organizations around the world. Our experienced research analysts talk to marketers every day from those just entering the digital realm to the innovation trailblazers. These interactions capture real challenges, best practices and what is critical for success. Gartner provides marketers with the research, data, tools and expert advice to rapidly deploy, optimize and measure digital technologies and coordinate diverse marketing programs into a strategy that drives results. GARTNER HEADQUARTERS Corporate Headquarters 56 Top Gallant Road Stamford, CT USA Europe Headquarters Tamesis The Glanty Egham Surrey, TW20 9AW UNITED KINGDOM Asia/Pacific Headquarters Gartner Australasia Pty. Ltd. Level 9, 141 Walker Street North Sydney New South Wales 2060 AUSTRALIA Japan Headquarters Gartner Japan, Ltd. Atago Green Hills MORI Tower, 5F Atago, Minato-ku Tokyo , JAPAN Latin America Headquarters Gartner do Brasil Av. Das Nações Unidas , 25º andar World Trade Center, Brooklin Novo São Paulo BRAZIL
7 2013 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of Gartner, Inc. or its affiliates. For more information, info@gartner.com or visit gartner.com. Produced by Marketing Communications cogfmlgfdmprov042313
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