Applying Ecommerce To Local Government

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[This is a rough, unedited crib of the actual talk given at the ALGIM 2010 Web Symposium. Also I went over my allocated time so I’ve elaborated on a few areas. If you have feedback on these notes, please write to me: mathew.sanders@gmail.com or twitter @mathewsanders.] Introduction Since the start of this year I’ve been working with the Local Government Services team at Datacom, which is a group of about 20 developers, analysts, and project managers who are dedicated to creating software solutions for local government. But my background and experience is working in ecommerce projects for companies like Air New Zealand, House of Travel, AMI Insurance, The National Bank, Telecom, and New Zealand Lotteries helping to improve their online customer experience. What I want to share with everyone today are some ideas, tools, and thinking that are established in ecommerce, and hopefully get you thinking about how they can be applied to your own projects in local government. Why move from offline to online Often we’re so focused on simply completing online projects that we forget to step back and look at the benefits of why we’re doing these projects in the first place. I believe it’s important, and healthy to step back and reflect on why we’re doing what we’re doing. In ecommerce, I think of there being three main benefits to moving from offline channels to online channels: To reach more people To operate with more efficiency To create new business models and opportunities To reach more people Here’s a Google map showing all the retail locations for Flight Centres in New Zealand. As you can see they have clusters of stores n the main centres of Auckland, Wellington, and Christchurch, and a range of stores scattered in other locations throughout New Zealand. They have a great network, but at the same time if you live outside one of the towns that has a store it’s very difficult to do business with them. And even if you live close to one of their stores you also have to visit them within their opening hours, which might be difficult depending on your work situation. With online channels of course you remove these barriers of time and location, and have the ability to reach anyone who has an internet connection, 24 hours a day. To increase efficiency When you interact with people through offline channels (such as phoning a contact centre or interacting in person in a store) the total cost to interact with people is directly related to the number of people you interact with. For instance, it costs about double the amount to interact with two people as it costs to interact with one, and about triple the amount to interact with three people as it does to interact with one. But online channels can follow a different pattern. The total cost does increase with the number of people that you interact with (because bandwidth and server costs will increase as you reach more people) but it doesn’t follow a linear relationship, instead it doesn’t cost much more to interact with 10,000 people as it costs to interact with 1,000 people. Something exciting happens when you think about costs as cost per interaction instead of total costs. With offline channels, you essentially get a flat rate. It costs about the same to interact with your 50th person as it does you 500th. But with online channels, the cost per interaction decreases with the more people that you interact with, eventually to the point where the cost per interaction trends towards zero. Two perspectives are important here. Economically and psychologically it becomes a lot easier to interact with people. In ecommerce this can allow for businesses to pass on cost savings to customers, or even offer free services. In local government this can allow an organisation to operate with lower cost per interaction. When you’re operating in an offline channel, customer interactions may either be consciously or subconsci

Transcript of Applying Ecommerce To Local Government

Applying Applying ecommerce ecommerce

to to local governmentlocal government

1 2 3

Why move from Why move from offlineoffline to to onlineonline??

Reach Operate Create new

Benefits

Reach

more people

Operate

with more efficiency

Create new models of

opportunity

Reach more people

$$$

Tota

l co

stIncrease efficiency

$

Tota

l co

st

$$$

offline

Co

st /

inte

ract

ion

Increase efficiency

$ online

Co

st /

inte

ract

ion

Increase efficiency

I want to go to Melbourne

Freedom of choice

I want to get a valuation of my property

Freedom of choice

Self

PricePricePricePrice

Ecommerce tradeoffs

Self

service

Ease of useConvenience

Convenience

Local govt tradeoffs

Self

service

Ease of use

service

Don’tDon’t force force

people onlinepeople online

Channel Strategy

But make online But make online

attractive attractive and and easyeasy

Channel Strategy

co-service model

Channel Strategy

New models

New models

Who moves first?

What to build?

Founded in 1998

Liquidated in 2000

$300m investment capital

Pets.com

How it works

Where can I get building consent information?

How it works

The way we think is The way we think is

radically differentradically differentthan the people we than the people we than the people we than the people we

design fordesign for

Inside out(our natural view)(our natural view)(our natural view)(our natural view)

language

Outside in(everyone (everyone (everyone (everyone else’s view)else’s view)else’s view)else’s view)

language

culture

experience

knowledge

research

design delivery

Ask (and listen)

Observe

Explore/Refine

100100100100arrive

35353535 continue online

65656565

}Why?!give up?phone?

exit and…

Measure

}Why?!phone?visit?

people spend more time on more time on other websites than on yours

RequestRequest product product oror serviceservice

Exchange of Exchange of moneymoney

Interactions

Provide Provide information information

Encourage Encourage Participation Participation

RequestRequest product product oror serviceservice

Context

Local governmentLocal governmentresolve or report a resolve or report a problem, apply for problem, apply for consent, request consent, request

Ecommerce Ecommerce Order books, music, Order books, music,

or clothes. or clothes.

Book travel or ticketsBook travel or tickets consent, request consent, request valuation…valuation…

Book travel or ticketsBook travel or tickets

�� Time on siteTime on site

�� Up sell/Cross SellUp sell/Cross Sell

� Time on site

� Pain

FunFun AnnoyingAnnoying

Exchange ofExchange of moneymoney

Context

Local governmentLocal governmentPay rates, fines, or Pay rates, fines, or

registrationregistration

Ecommerce Ecommerce Pay for stuff in Pay for stuff in

shopping cartshopping cart

� Effort to complete

� Change of mind

� Effort to complete

� Pain

Fulfil a Fulfil a desiredesire

Fulfil an Fulfil an obligationobligation

Provide Provide information information

Context

Local governmentLocal governmentParks, museums, Parks, museums,

vacancies vacancies

Ecommerce Ecommerce News, “news”, gamesNews, “news”, games

�� Time on siteTime on site

�� Repeat visitsRepeat visits

�� Ad revenue Ad revenue

�� Ease to findEase to find

� Time on site

� Pain

Entertain or Entertain or distractdistract

Answer a Answer a question question

EncourageEncourage participationparticipation

Context

Local governmentLocal governmentVote, discuss Vote, discuss

Ecommerce Ecommerce Create contentCreate content

Organise content Organise content

�� Participation Participation

�� ValueValue

Trivial Trivial ComplexComplex

�� Participation Participation

�� Democracy Democracy

Context

1979SONY Walkman

1984SONY Discman

Models change

1992SONY MD Walkman

1999SONY Network Walkman

2001APPLE iPod

Models change

201010 billion songs sold through iTunes Store

Environment changes

Mediums change

Mediums change

Expectations change

1990 2010

Benchmark Benchmark where you are todaywhere you are today

Define a vision Define a vision & how success & how success

would be measured would be measured

Roadmap

would be measured would be measured

Create a roadmap Create a roadmap that shows how that shows how

to deliver the vision in achievable to deliver the vision in achievable

phases phases

Thank youThank you! !

Questions?Questions?