How Philips develops an online shoppingstrategy with SAS Social Media Analytics

Bussum, 5 October 2011SAS Forum Nederland 2011

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A well-respected, blue-chipcompany for 120 years

Founded in 1891Headquartered in Amsterdam, the Netherlands

Sales over EUR 25.4 billion in 2010 (USD 33.8 billion)33% of sales generated in emerging markets

Globally recognized brand (world top 50)Our brand value doubled to $8.7bln since 2004

119,000 employeesSales and service outlets in over 100 countries

€1.6 billion investment in R&D, 6% of sales50,000 patent rights – 36,000 registered trademarks –63,000 design rights

Source: Koninklijke Philips Electronics N.V., 2010

“…a global company of leading businesses creating value with meaningful innovations that improve people’s health and well-being.”

Leveraging critical global trends

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Let’s show some hands!Some questions about Social Media?

• Does your company use Social Media?

• Is your company in dialogue with consumers through Social Media?

• Does your company use Social Media for strategy development?

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Consumers are moving outside the purchasing funnel: Changing the way they research and buy your products. Change in approach is a necessity.

The consumer decision journey

The consumer considers an initial

set of brands, based on brand perceptions

and exposure to recent touch points.

11Consumers add or subtract brands as they evaluate what

they want.

22Ultimately, the

consumer selects a brand at the moment

of purchase.

33After purchasing a product or service,

the consumer builds expectations based

on experience to inform the next

decision journey

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Source: McKinsey, The consumer decision journey, June 2009

Clear roles to reinforce the brands with every consumer interaction

TVad

Radioad

Printad

Papermail

Email Website

KioskStore IVR Callcenter

Product

Communicate imageby

Marketing

Deliver valueby

Consumer Care

Social Media ChannelsSocial Media Channels

Making promises

Keeping promises

Source: Forrester

Using Social Media channels to engagewith consumers in conversations

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WHAT?HOW?

Real time

Screen specific “hot” topics

Not real time

Look back and screen comments on particular

topics

LISTEN

Participate

Generate a topic and discuss it with consumers e.g.

Streamium cafe

Inform & learn

Learn and understand consumers’ opinions e.g.

Philips community

TALK

Reach out

Update social channels, e.g. external weblogs to inform or engage consumers with

up-to-date information

Receive

Respond relevant information to comments or questions

posted on social channels, e.g. Facebook, Twitter

SUPPORT

First Listen, then engage on Talking with and Supporting of our consumers

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Through social listening heavy negative detractioncan be converted into positive sentiment

OHC ‐ US & UK>600 relevant social comments 

and consumer feedback comments 

from >1500 websites/domainsand from >6000 call logs/NPS free texts converted into 25 new 

categorized FAQs

NPS Oral Health Care (3 months rolling)

0%

Content updates

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Very high internet penetration in the Netherlands (2010)

85% of population active online70% of online users shopped onlineAverage spend €386 per person

Very high internet penetration in the Netherlands (2010)

85% of population active online70% of online users shopped onlineAverage spend €386 per person

But through social listening more can be done:In 2015, 80% of Dutch consumers will buy online

source: European Online Retail Forecast, 2010 To 2015, Andrea Carini, Forrester

Online retail market will grow to over €6 billion in 2015

Major categories:• Consumer Electronics• Clothing• Event Tickets

Online retail market will grow to over €6 billion in 2015

Major categories:• Consumer Electronics• Clothing• Event Tickets

How now to benefit and keep up with this online growth?

A growing online shopping audience that increasingly shares experiences and expectations

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• Additional analytics performed to validate data• Tight deadlines delivering preliminary results• Continuous learning strategy

Define concepts

and queriesCrawl data

Natural Language

Processing

Rules definition

Sentiment Analysis

Execution

SAS Social Media

Analytics Portal

Rules Validation

• Service • Reliability• Ease of use • Comparing• Design

• 12.000+ docs• 1.300+ sites• 24 months• Incl Twitter• 2 months

Social media analytics give additional consumer research insights for strategy development

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This time not a typical ‘branded’ approach, but a thematic one: ‘Online Shopping’

An example to demonstrate what’s on their minds and hearts during their online shopping experience

• Where are they talking?

• What are they saying?

• Which topics keep them busy?

• How relevant are they?

• What is the sentiment that they express?

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Service ReliabilityEase of use Comparing Design

Reliability is crucial, however consistency in performance is king• Compared to online clothing retailers, reliability is even

more important for consumer electronic webshops– In particular, wrong stock information is a big dissatisfier– When perceived as reliable, ease of use is rated less important

• Ease of use and service are more receptive to sentiments

• Overall sentiment is heavily impacted by a negative experience only a consistent positive performance leads to a positive rated shopping experience

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Insights in emerging initiatives and upcoming trends that may enhance the shopping experience

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Consumer Care, March 24, 2011

Our answers to the questions

• Does your company use Social Media?

• Is your company in dialogue with consumers via Social Media?

• Does your company use Social Media for strategy development?

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Thanks for your attention17