The recent Web 2.0 Expo [1] in San Francisco was an upbeat affair showcasing a lot of interesting technology. The initial consumer-focused hype is receding as the next phase of "social business" adoption gathers momentum.
In this article, I'd like to share my thoughts about the state of Web 2.0, where it's going, and what it means to a customer-centric business.
Web 2.0 is growing up
Two years ago, when I wrote about the 2007 expo in Web 2.0 Powers Up People [2], most of the buzz was around social networking and user-created content—which as we all know has forever changed the balance of power between consumers and the companies attempting to "manage" them. In this year's event, enterprise use of social computing played a much more prominent role.
In his keynote message, Tim O'Reilly (founder and CEO of O'Reilly Media), who coined [3] the term "Web 2.0" some five years ago, said the term was not meant to be a version number. In other words, don't look for "Web 3.0"—not from him, anyway.
Web 2.0 was meant to be a reflection of the successes that came after the dot-com bust. Namely, using the web as a platform and harnessing the collective intelligence of users, who create much of the content on their own.
Looking ahead, O'Reilly said his vision is for a "smarter" web that makes sense of the enormous amount of data now indexed by search engines. As for what to call this next phase, he said that he and John Battelle of Federated Media developed the term "Web 2.0 + World = Web Squared."
Maybe some math geeks will love this, but personally, I don't think "Web Squared" will take off. Do you pick up your "telephone 3.0" to make a call or live in a "car squared" just because the technology is upgraded? Maybe we'll just go back to calling it the Web. Or, "cloud computing" could become a more dominant term.
Nevertheless, kudos to O'Reilly for using "Web 2.0" to galvanize the industry. Mission accomplished!
MISO soup
How can you tell when something has really gained momentum? When the MISO software vendors started paying attention and investing serious money. MISO stands for those four titans of the technology industry: Microsoft, IBM, SAP and Oracle.
Microsoft [4] had a big presence at the show and Stephen Elop, President of Microsoft Business Division (which handles Office, SharePoint, and Dynamics CRM) was in fine form as he pushed the company's "software plus services" message in a Q&A with O'Reilly. Elop alluded to a future convergence of CRM and SharePoint, which makes sense to me if their CRM solution is going to step bravely into a more collaborative world.
Two years ago, Big Blue had a smallish booth pitching Lotus Connections as a solution for internal collaboration [5]. But that has definitely changed, with the addition of more social technologies, improved navigation and integration to CRM solutions. Lotus Connections 2.0, due out in June, will offer a social network analysis/visualization tool called Atlas [6]. This has really interesting possibilities for companies to figure out who is really contributing to an organization. Also note that IBM is investing heavily ($100M according to a booth rep) in a social computing think tank [7].
Side note: Social network analysis could usher in a new era of "employee value management." In the future, your value as an employee could be determined by the number, type and strength of connections that you have internally and externally.
SAP and Oracle weren't part of this event, but don't underestimate the long-term social intentions of either company. In the short-term, expect to see more Web 2.0 features added to existing products, like Oracle is doing with its Social CRM [8] offerings. But you'll know they're really serious about the collaborative web when they buy one of the innovators. More on them, below.
For the MISO vendors, I give IBM the edge in selling a more complete/robust application suite and Oracle the nod for putting "social" into marketing play for the internally-focused "CRM 2.0" world at least. Microsoft can build off its SharePoint product, but I think progress will be slow, much like the five years it took create a credible CRM solution [9]. And SAP? Well, ironically, this is the company that heavily used "collaboration" in its marketing a few years ago. But, rumors are circulating about the uncertain future of SAP's social media strategy [10].
Pioneering spirit
While the MISO vendors help validate a trend, it's the smaller vendors that really drive innovation. And I don't mean just start-ups here. Many of the vendors of "social business" solutions have been in business for five to 10 years or more, have dozens to hundreds of customers and book tens of millions of dollars per year. Twitter could use some of that largess right now.
SaaS pioneer Salesforce.com [11] now has thousands of customers and books $1B/year in revenue, mostly from its sales automation solution. However, in the past year Salesforce.com has been pushing its cloud platform (Force.com) and Web 2.0 features are rapidly being introduced. Unlike Oracle, which so far seems mainly concerned with internal sales collaboration, Salesforce.com also connects to the outside world of Facebook and Twitter, and integrates nicely with community solutions from Lithium and others.
Ten years ago, Salesforce.com was just an idea. Now it's jockeying for a position in the upper echelon of the technology industry, although at "just" $1B per year it has a long way to go to challenge the MISO bunch. Still, I think the company is brilliantly positioned to capitalize on both cloud computing and the social momentum.
The name game: CSCW, anyone?
What should we call this class of enterprise software designed to enable collaboration? I had an interesting chat with Marc Smith, the Chief Social Scientist of Telligent [12], a provider of "social network software." Smith reminded me that many other other terms including "groupware" have have been used over the years, and that the lack of a common name won't stop progress.
Maybe not, but I believe that the industry is at a point where a standard term is necessary to "cross the chasm" into the mainstream. CRM didn't really take off until the market settled on "CRM" about 10 years ago. Quick, can you name one major enterprise software category without a three letter acronym?
"Computer supported cooperative work" (CSCW) was coined [13] about 25 years ago, to address "how collaborative activities and their coordination can be supported by means of computer systems." The systems themselves are called groupware. Or were.
"Social" is a more modern term, but is probably more commonly associated with non-business interactions on sites like Facebook, YouTube, etc. "Enterprise 2.0" may be more comfortable for those who think "social" means playtime—not something corporations are paying their employees to do.
Personally, I like the term "social business" to mean enabling internal and external collaboration, using social media technologies. That's why last year we developed Social Business [14] as one of CustomerThink's major editorial topics.
Off to the races
The winning term will emerge within the next year, maybe two. Meanwhile, Jive Software [15] is pushing "Social Business Software" and has built a strong position in this emerging space (see Now We're (Jive) Talking! Real Social Business Applications to Engage with Customers [16]).
But is Jive the "global leader in Social Business Software," as claimed in its marketing messages? Um, sure, since it appears to be the only company using that term. OneSite [17], which sells "social network software," also has an impressive customer list, supports over 4,000 communities including a huge one for American Idol (1.6 million members). OneSite can be installed on-premise, but is mostly deployed via SaaS.
For customer support applications, Lithium [18] would be on my short list. As I wrote in Building the Social Customer Service Experience [19], communities can help reduce support calls by helping customers help each other. Lithium offers pre-built connectors to RightNow and Salesforce.com to enable automated case creation and escalation. But Lithium, like Jive, has expanded into marketing/sales and innovation applications.
Another interesting vendor is SocialText [20], a big name in internal collaboration. The company started with wikis in 2002 and since then has added the usual assortment of social media functions like blogs, profiles, etc. Even Twitter integration. But, oddly, nothing yet in social network analysis. SocialText seems to be hedging its bets with the clunky marketing term "Social networking with Enterprise 2.0 collaboration."
A more recent entrant is HiveLive [21], started in 2006 by two Stanford grads to offer an integrated solution for building customer communities. Each community is a collection of "hives"—which can include the usual things like blogs and forums or something more custom.
There is a natural crossover from CRM vendors, because social business solutions can add value to marketing, sales and customer service organizations. But another potential crossover is Web Content Management (WCM). Vignette [22], for examples, offers an array of social capabilities including "social search," integrated with its core WCM platform.
Increasingly, Enterprise Feedback Management (EFM) and text mining vendors are also mining social media content for insight. Overtone [23], a SaaS text-mining vendor formerly known as Island Data, now enables an enterprise to "listen" to social media channels in addition to other unstructured forms of customer feedback.
Get a job!
What's most exciting to me is the potential for social media technologies to enable Customer Collaboration Management (CCM), which is all about joining the conversation with customers. CCM is the third major wave of customer-centric thinking, following CRM—which is mostly about managing customer information and maximizing revenue, and CEM—which is about creating and delivering great experiences to drive loyalty.
My son Matthew is finishing up his sophomore year in high school. Before too long, he'll be off to college and then out in the workforce. Web 2.0 is in a similar state. The past few years have been fun, but the future will be about how to apply social computing to foster the win-win relationships that are part of any truly customer-centric business.