TheNextCMO’s latest podcast is with Ken Rapp the founder and CEO of Blustream as our guest. Ken is a dynamic entrepreneur leader. His expertise includes launching products, building scalable business models, and creating culture that enables employees to thrive. In this podcast we discuss the importance of post-sale engagement and the repercussions of not communicating with your customers, who in an organization should own this process, and how much time a company should spend on acquiring new customers vs. maintaining and expanding the existing ones.
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Ken Rapp: [00:00:00] Welcome to the official
Kelsey Krapf: [00:00:01] podcast of the next CMO. Hosted by Plannuh. Makers of the first AI driven marketing leadership platform for quickly and easily creating winning marketing plans, maximizing budget impact and improving ROI. The next CMO is a thought leadership podcast for those that are CMOs or want to become one.
My name is Kelsey Krapf and I'm the senior marketing manager
Peter Mahoney: [00:00:24] and I'm Peter Mahoney. I'm the founder and CEO of Plannuh and welcome to the next CMO podcast.
Kelsey Krapf: [00:00:30] For this week, we have Ken Rapp, the founder and CEO of Blustream. As our guest, Ken is a dynamic entrepreneur leader and his expertise includes launching products, building scalable business models and creating culture that enables employees to thrive. Thanks for coming on,
Ken Rapp: [00:00:57] Ken.
Peter Mahoney: [00:00:58] Tell us a little bit about your background. What brought you here and tell us a little bit about Bluestream
Ken Rapp: [00:01:04] So I play some acoustic guitar and and they were the founder who I be, I'm a co-founder with Bob and there's a couple of other guys. They were working on the problem that an acoustic guitar cracked right about now as the wind is the weather in new England here, it gets drier and colder.
And why didn't that guitar tell the owner that it was in distress, like other things in our lives that your car tells you it needs an oil change or, your heating system changes. So it was a really intriguing situation. And I actually think we're onto that from that early Amber of the flame that we'll talk about here today.
That the next unmet need is that after a sale, when a product goes home with its owner, it's left to the owner to know what to do and when and how, and that's really what Blustream is all about. And I'm excited to talk about that with you guys today.
Peter Mahoney: [00:02:01] That's great. And certainly the area of it's, a lot of people are in the mode of selling a product and then forgetting it and going on from there.
And I think because of the evolution in the acceleration of SaaS based business models, as an example, I think more and more people are are aware of the importance of having a strong, ongoing engagement with your customer to understand what they're doing to help them to support them, but not everyone is obviously.
And and I think a lot of people are still behind the time the times when it comes to that. So set up the problem for us and help me understand. Do you have any good examples of what happens when companies really mess this up? If they have a product and have no way of communicating back to the customer, what, what happens.
Ken Rapp: [00:02:48] So it's really a great question. As we think about the landscape there's three examples that I think are marvelous on what has been solved that leaves the unmet need available to be solved. One is, if we're looking to add more suspects and the great unwashed into our sales funnel, there's some dynamite marketing automation systems that allow us to do that.
And then when we have those suspects in the top of the funnel, there's some dynamite and we've used them. All of us have used them systems that will take your customer through the buyer's journey, through the funnel. And then when they come up the bottom of the funnel, we all say, wohoo, we got our order.
We got a sale. Especially, as we're closing out a year but then those customers go into the wild with the products, they bought. And what is, again, a fantastic area that's automated and set of systems would be. The customer has a problem and they call in and there are great systems that manage problems if there's a problem with the product.
So you'd never drop a problem again. And like I said, I'm old enough to remember having a talk to our receptionist so that he could tell us here's the tick, here's the piece of paper and the phone number you need to call. Whereas today it's all automated and it's, those are great, but what really, there isn't a simple and affordable off the shelf platform, analogous to those platforms that would allow the product and owner relationship to be communicating back to the brand in a simple way. So the brand and the company that made the product can make the right recommendation right throughout what we call a product's life cycle after sale life cycle of the product.
So I think it's an unmet need. So I can't tell you one bad example. I just think it's a generic unmet need.
Peter Mahoney: [00:04:39] Yeah. I can definitely get that. And and I think we all have, as consumers have experienced. Have experienced a let down after you purchased a product. And and maybe it didn't behave the way that it should.
You're a little bit surprised about the the customer experience, but there's probably an opportunity there too. I suspect. So one is obviously if there's a problem you want to discover that problem. But the other side of that of course, is the opportunity to to understand how customers are using products more effectively, and then find their own unmet needs.
What are the things that they trying to do that you might learn from their usage and their behavior to figure out? Maybe there's something else that they can buy for me to get more out of it. Is that sort of, part of the way people should be thinking about this, Ken?
Ken Rapp: [00:05:29] Yes. So we define. The after sale product life cycle into four stages first stage is unboxing.
You get your product and you get it home and you unbox it and you look at it and it hopefully is what you expected. And there's some do's and don'ts. And then the next stage though quickly becomes what we call onboarding. So this is where your skill as an owner is typically going up. And the, there may be a break in period for the product itself.
And that could be one hour of onboarding, or it could be one month of onboarding depending on the product or even a season of onboarding. And then you move to third stage, which we call just usage. It's usage and enjoyment and that's when the product is being used. And yeah. Typically there's things to learn and this things to increase the owner's expertise and even do some things that are interesting, that you might not have known about with the product.
And then finally the fourth stage would be maintenance and care. And that's, as I think about some examples that can be a one page document on care, or that could be a 200 page owner's manual, like I have in my car, which I opened the first day when I got it. But I certainly haven't gone back to it to know what I should be doing throughout the life of me owning that car.
So when we look at the world through the lens of after sale product engagement and after sale product life cycle, what we do is think about customer experience, touch points that could be extracted from those four stages of ownership of a product. And having a platform that makes it very simple to marry a triggered event to an action.
And we can use any kind of event from a, an inquiry to a consumer about how it's going, taking pictures. Could be sensors, could be the weather could be time-based and letting our brand partners set up triggers and actions that then get saved and run in a cloud to make personalized recommendations around education.
Alerts and purchase recommendations. So you mentioned just recommendations. Absolutely. There are appropriate times when a consumable might be appropriate or oil for your chain. If you've written your bicycle 20 hours and a platform like this would know at 15 hours it's being ridden once a week for an hour so we've got five more weeks to go. And so we're not gonna actually hit them with a coupon, hit our owner with a coupon. A campaign we're going to wait until we're, two hours worth of bike riding away from when the oil would be appropriate and offer educational link. Would you like to see how you would properly take care of that chain?
And then one week ahead, which is the next hourly session, would you like a one-click purchase right back to the bicycle manufacturer or that brand to get the right oil for that bicycle? So it, what we've done is we've said this. This area, this unmet need where a consumer or an owner buys, something, takes it home, and then they unbox it.
They onboard and learn about it. They then start using it and there's some maintenance and care. We work with our customers to say, what are the touch points there that we could create awesome engagement and customer experiences. And we all know that the end result of better customer experiences is not only C-SAT and Customer joy, but it's revenue.
It there's revenue. There's profit does an economic impact on the business.
Kelsey Krapf: [00:09:10] How much effort should you spend as a company, acquiring customers first maintaining and expanding the existing ones. I think people have a difficult time, finding that balance. We have teams dedicated to it, but how much time should you allocate?
Ken Rapp: [00:09:27] . So to go get new customers is five to 10 times more expensive than retaining the customers you have.
And so I don't know how to put that into time specifically, but when I think about that problem, that you're asking about. It's a great question because the actual reselling and remarketing to the same customer is general practice today because we're not, we don't have our partners are, our companies don't have a connection to their customer.
So all they can do is execute on programs that are reselling and remarketing amongst all of the other non-customers, which is much more expensive than if you had a customer connected and bringing value that you could ultimately give the right recommendation at the right time and get very high conversion rates where we see over 40% conversion rates on our recommendations, which is a little bit outrageous, but it's really not. Because when my car tells me to change the oil, 100% of the time I changed the oil. But when I get a coupon in the mail from my favorite car service provider, that says you can have a 10% off changing the oil, I believe I, that's again they're marketing to me as if I'm just a general person.
Rather than when the car tells me to change oil. Now what the car doesn't do today is it doesn't then schedule the appointment, connect me to my service provider, have my credit cards so I don't have to wait in line when I get there. And and manage me through the remediation or the solution to the problem.
What it does is it's focused on alerts rather than the education and purchase recommendations and remediation, which we think is great. Cause the alerts does a lot for an owner like me, but the I actually have a great example.
So the thing that's I'll share with you guys and your. Your listeners that I became a grandfather a year ago first time. And that's an awesome thing. So I highly recommend it to people. But what was cool is my daughter-in-law. When she first got pregnant, she said, Hey, you should download the BabyCenter app and just plug in.
My grandson's due date and I did that. And when I like I said, I'm old enough to know when my wife and I had our two boys, we had a book called what to expect when you're expecting. And that was our Bible, as we went through the pregnancy and after the pregnancy, this app gave me every few days an alert about the product, which is the baby and the owner, which was the mom, what to do about the baby's growing fingernails. And so you probably should eat some more spinach. I like to watch a video on exercising the right way to help your baby, et cetera, et cetera. Fantastic. Then further as she got further into the pregnancy, it even told us with one touch purchasing click here if you want to get some formula, because you're now seven months into the. Into the pregnancy and your baby is coming up on, you're going to need some things in the house before the baby's born. It had click back to talk directly to their advisers about anything questions about the pregnancy.
So it did alerts education and purchase remediation, quote, unquote recommendations. I just think that's a fantastic model. The problem is. It's expensive to do that. If you're a product company that makes a product and you don't have a software team. And so it's expensive. It's actually complex because as our mobile devices or laptops or email and texts came along, as the technology platforms evolve. You'd need to keep maintaining and supporting whatever you developed. And so that's it's not just developed the product is developed, but it's maintain it and support it. Whereas if you're using a sales management platform out there, they do all those updates for you and you just use the platform.
And that was really what struck us as the unmet need. We could be very helpful to lots of companies. That make products, but don't have that connection, ongoing relationship with their customers. And that don't make sense.
Peter Mahoney: [00:13:35] It's interesting because you can imagine that. I think a lot of people intellectually get the fact that they need to engage with their customers after they purchase it, but don't know how to make it a reality.
And what you guys have done is actually put the tools in place and I assume can provide them with the advice and counsel, at least at some level to say these are the kinds of things you should do to nudge them in the right direction. Now it's interesting because the example you brought up around a, going through a pregnancy is something that brings up some important factors that you need to think about when you're engaging with consumers and using consumer data is the balance between alerting and utility and usefulness and data privacy.
So how should people think. About that relationship with their customers data.
Ken Rapp: [00:14:23] Yeah, that's a, that's so important. So philosophically we just believe give all the control to the consumer. They should be able to stop anything. They want to stop and opt out. And in fact, our execution is that the data, all the data is owned by the consumer.
Period. End of story. They own the data, the company, but he brand who's going to be getting the data directly and then that's the round trip. It goes product to brand or company, and then recommendation out to the consumer and then feed back to the brand. So it's product brand, consumer back to the brand.
They're what's called the controller of the data. So they're the ones who can decide what properties are, the right properties, what are the right recommendations? And what's really cool is most companies have a lot of content and knowledge already. It might even be on their website sitting there. It could be like a friend of mine got to keep it the other day that he bought for a family member for Christmas. And I can't say his name cause I'm the family member not might know that they're going to get a keyboard, a little keyboard. And it came with a whole plethora of knowledge and educational materials and information.
He's not ready for it. And so what's awesome is the data is controlled by the brand so they can put the right information at the right time. And then blue stream's job is the third leg of the stool and we are we're the processors of the data. So our job is to process that data create personalized experiences from how the consumers react to the recommendations, give that data back to our brand partners so that they know who's using the products when they're using them, why they use them, how they use them, what they don't like, what they do and then, really that feeds into the whole product strategy side of the equation. But data security data control is so important that, and just add it's at its fundamentals.
The consumer or owner of the product owns the data.
Peter Mahoney: [00:16:33] . That's a great philosophy. And in certainly it's something that's being mandated in some parts of the world right now. That it is so it's good that you guys are on the right side of that, especially as the gDPR legislation evolves and hardens, and we're starting to see more like in California people starting to push more consumer friendly data protection.
So clearly in rightfully it's going that direction. So it's good that you guys are philosophically aligned with that. So the other thing that, of course this does, especially if you are so if you are a brand making a product. In, in many cases, in fact, some of the cases you brought up from your car to some baby thing, to something else you're often selling your products through a distribution channel in, in, in doing that historically brands have really lost a connection in lost visibility into what's going on with the consumer.
So this presents them all of a sudden with a plethora of data that they can th that they can use, responsibly of course, to understand what the consumer is w what their experiences that the big question is, do people know what to do with it? Do people even know? So if you say if a customer who a brand who's making a product says, I want to create a better post post-purchase engagement process.
In general, do people know how to do that? They just don't have the tools or do they actually need to understand the kinds of independent of the tools, the kind of approaches they should take to create an engage with their consumers better. And the parallel I'll make is around things like website personalization.
So everyone in the world knows that personalization on your website is a good thing. The problem is that many marketers don't really have the tools to create segmented and personalized messages. So they can able to all the technology in the world, but they don't know how to do it. So do the brand managers understand this kind of consumer engagement, these techniques that they need to think about as you design a post purchase experience with their customer.
Ken Rapp: [00:18:41] Yeah. So because it's a white space unmet need, we're very happy to work with brands and walk through the process that we've learned about in our evolution as a company and what other customers are doing.
And what's cool as customers. Our brand customers are very open to sharing. How do you improve customer experiences? That's the great, that's why I love being in, in, the work that we do, all of us, is we really care about customers. We do want them to have a great experience and we're learning together.
So I don't think we're we're near the point yet where. Everybody knows exactly what to do. You're right. Peter, we D we, we have to look that, and that the context that I described earlier is so important that we that's our fundamental framework work is the life cycle of the product.
And the good news is there's an awful lot of knowledge around care and maintenance of a product. That most brands have. They are the experts. They have the knowledge. So there's a lot of touch points right in there that, that are available to us. It's don't let the humidity get too dry and crack my guitar.
So how should we solve that problem? And then we work together on, do we monitor weather? Do we put sensors in guitars? Do we ask customers questions? Those are all reasonable solutions. But it's. On the unboxing on boarding and then the general usage of the product where we're going to learn a lot.
We're going to learn a lot over the next decade about how products are used in the wild, because we don't know. And I think that's going to be just a marvelous next step for all companies, all producers of products. You made another comment I'd like to go back to, and that is given the world today, the traditional distribution channels are very different than they were a year ago. And most people don't want to just go to a store and hang out. I'm not saying you don't love to shop, but they don't want to go to a store and hang out and try stuff. And so the wholly ecommerce revolution has been accelerated in our view, what we see as a result of of the pandemic and what's going on. And I had a conversation this morning with an investor who we were talking with about that's step one to have e-commerce, but it still doesn't get you the engagement. And so the, if you're going to, if you're going to invest in, in an e-commerce program, it's pretty good timing to be learning about and thinking about after sale customer engagement and a company like Bluestream, we're passionate about it. We're passionate. All of us really believe that there's a place to help the world with after sale engagement and, are happy to share our tools.
We have financial models that we'll share with companies that they can plug in their numbers and plug in churn rates today and look at models if you reduce churn and retain customers, you can put in your current revenues and say, what's the gross margin there. And if I add to to the connection points not only with the retail distributions, but if I add this channel, do I increase my gross profits and things? So we have some financials we can help them with as well as this customer experience process of learning from a customer who I, for one, don't read a lot when I'm sent an email with a lengthy, I have too many emails today, but I'll stop and watch, a 30 second video.
Anytime it's 30 seconds. I could do it while I'm doing other things. So learning about Ken is really important because then that's the way I want to be, have the content curated for me personally. And that, it's the kind of thing I think we're going to learn a lot about as we go forward into this after sale customer, product usage and engagement.
Peter Mahoney: [00:22:31] So I I'd assume that there are a couple of different, at least a couple of different segments of product producers. There, there are people who are deeply connected, where you have an IOT kind of strategy and you've got a smart device. That's got sensors and it's feeding things back in real time to the mothership, et cetera.
So your car these days is a giant bundle of sensors. That's connected into the, to the net as an example. But then there are companies that aren't. So there, there are companies that are making a simple physical product. And in that case, I assume you need a different strategy to engage the consumer. As an example, you're going to need an email, as you said, you're going to need some method, whether it's an app that's an accompaniment to the product or an email experience that that is part of the overall solution to the customer. And then I assume you need some kind of incentive for them. You need to communicate the value for them to provide that information and get updated at certain times. So if it's, you need to buy formula now, or you need to change your oil, or you need a new bike chain, you need some for some way you need to do that.
Is that something that core understanding? I assume that's something that is probably new for people. Figuring out how to create those post-sales engagement models and incentives so that people actually engage.
Ken Rapp: [00:23:58] Yeah. Great point. Is that there, we found three components that are pretty important that we've got, had to build skills and expertise on to partner with brand product manufacturers and leading brands. And if I work backwards, it's from the cloud. And what are the, we call them product journeys in the life cycle after the sale. So the unboxing onboarding using and caring or maintaining. You can set up that data that you want to trigger an action and store it away, and we call those journeys.
So you'd build your product journey, templates and store those away. And then they run up in our cloud. The next layer getting closer to the consumer is mobile apps. And not everybody has that skill or has that expertise. And so we've had the ability and built our competence on providing white, labeled mobile apps for our brand partners.
They're able to use their colors, their logos, and their properties for their products, and then getting closer to the product itself. In some cases it's simply for example In the pet industry is this is a better food that we want to provide to our customer. And it may be simply answering questions about how's the puppy looking today.
How's the coat. Look after a week of eating the food, would you step on the scale and hold your Papa or get your dog on the scale and just enter in the weight, or it can be, is as important to have source data as real sensors that are part of, like you said, the car or to read the motion on a puppy and then have that transmitted up to the cloud so that you can use that as source data to trigger an action.
And so Blustream has built the expertise on all three of those layers in the cloud to enable journeys, to be run. With mobile apps that are available either if a customer has a mobile app, we can provide them with the links up to the journeys and to the source data. And then down at source data, the IOT, you mentioned IOT it's interesting in IOT, there's 30 billion IOT sensors in the world today.
And a fraction of those are being used beyond alerts there. So their fundamental purpose was to alert you to something going on with that product or with that environment. But then the data is it used in context to then make a recommendation back to help a customer or owner do something with that data.
And I think that's part of the evolution of IOT is now that we've cracked that one IOT devices are pretty, pretty commercially off the shelf. You can buy sensors pretty inexpensively these days, rather than trying to make money on sensors in a product. Our approach is let's build the business by using sensors.
If that's what you need to power product journeys, and then together we'll work with you to grow your revenue and your customer engagement and experience.
Kelsey Krapf: [00:26:56] Ken I'd love for you to give us an example of, someone that does a company that does a great job, managing this post-sale customer experience.
Ken Rapp: [00:27:08] Yeah, that's a great question. Let me give you an example of us I'll stay with the music industry on a great respect for that first problem that we solved. The folks who make cases for acoustical instruments they are looking at it through the lens of, you get home with your instrument, you on box it.
And it's, the environment is very important. And so when you wan box it, they can ask some, checkpoints there and have some education available. And then as you start to use the product, knowing every time the case opens and closes. So in that case, we did some IOT work. And the team has it knows if the case is opened or closed.
So you likely are playing, is playing the instrument, whatever it is in there. And it also has temperature and humidity available as source data. And it's a great example of a monitoring of the environment combined with education and usage. And for example, I happen to be a guitarist and I I'm I'm a born again after my kids grew up, like back in a rock band and we're not out playing now, but we love playing and I changed my strings quite a bit.
And so knowing how often I'm playing, connecting that into, five hours of crazy Ken playing real hard with lots of sweat on his hands, to the strings, he ought to replace the strings. That's a touchpoint that we can walk through. I don't know if that answered your question, but that's an example using a musical instrument.
And as an example, without the IOT, I talked about food and asking questions of a consumer and then, I just happened to love my grandson. So I'll stick with my BabyCenter is such a great way to to see what we're talking I'm talking about here in terms of a very comprehensive solution.
Peter Mahoney: [00:28:52] That's great. And I think there are probably fewer great examples than opportunities to improve out there today, which speaks to the unmet need part of what you guys are trying to solve, because I think some of these capabilities are just starting to become available for people. Obviously the acceleration of digital purchases and connectedness of consumers is something that is leaning into this opportunity.
So it makes a ton of sense. So one question, Ken, is who inside an organization do you think should own the post-purchase experience?
Ken Rapp: [00:29:28] In my circles, What we talk about. And when I'm talking with other marketing and salespeople that the CMO really has moved from and it's always been here, but has a focus has moved to revenue in addition to maybe the assuring the outreach and driving new business and getting prospects into the sales funnel.
So I think CMO, this is a perfect audience for who we like starting with, because a chief marketing officer really understands that it's now so important that it's, that the outreach and omni-channel investments and digitization is all going to drive revenue for the company. And and it's got to do it and make customers super happy, and have a great experience.
So that's really who I think, really starts championing this type of effort.
Peter Mahoney: [00:30:19] It's interesting. And of course not shocking that you're on the next CMO podcast talking about this, but most CMOs, one of the biggest struggles is finding opportunities for growth. And interestingly, it sounds like it's right under their noses.
And if there's an opportunity to find a way to engage those consumers to become more successful and not churn if it's a recurring model or buy more buy related products and services as an example, which seems to be your you've brought up some great examples with the bike chain, the dog food the baby formula there lots of great opportunities. If you understand this journey, when most people don't. Do th they don't have a sophisticated enough understanding of what the consumers do with the product, once they get it out into the wild and they may not have the tools and techniques. Necessary to actually make this happen.
Yeah it's really fascinating. So I think we're getting to the end of our time here, but just a couple of quick questions. One, how can people learn more about Bluestream
in and who's the right kind of company to work with Blustream? Is it a, a giant brand?
Is it a small brand, anything in between? So tell us a little bit about that.
Ken Rapp: [00:31:32] W great. So as we're wrapping it up, I would offer anyone who would like to reach out to me directly. I'm happy to, start with me and we can have a quick 10 minute discussion and test the waters and we're here to help.
And certainly can at blue stream, no E and blue it's blue. I was going to say there is,
Peter Mahoney: [00:31:52] there is any, there's just one of them not to.
Ken Rapp: [00:31:54] That's what I was wanting you not to thank you for that clarification, that would be blessed
Peter Mahoney: [00:31:59] Ram.
Ken Rapp: [00:31:59] Just to be clear. That's true. It'd be blessed ramp.
Maybe it should be sometimes that causes confusion, but anyway, so I'd be happy to, to to speak with anyone and get started. I've been around the block. So our, my approach is that we're just here to help the industry and happy to share all the resources we have. You can visit our website, which is blustream.io
and any of our team may or may, be happy, would be happy to talk to, the points you're making here, Peter, that there's, this is a kind of a new area to think about the customer engagement, other than we're on very solid footing with maintenance. But in food and beverage and in some consumable products that can even apply here there, isn't a maintenance, other than it might be an environmental factor.
You want to keep the food or the beverage in the right place. So it's a blank sheet of paper and we have a framework and we'd be happy to talk through and share our framework with any of your listeners.
Peter Mahoney: [00:32:58] That's fantastic, Ken, and I think just one last more question from Kelsey and I think we'll wrap from there.
Kelsey Krapf: [00:33:04] Ken. Favorite question. What advice would you give to those that are CMOs or aspiring to be one
Ken Rapp: [00:33:10] A boy that's like I grow. Isn't that the question that we're all so lucky to be living. It's, we're lucky to be alive, but we're lucky to be living in a period of unbelievable transformation in the customer experience world. And so I say, keep at it, make sure you're solving a real problem. That's the fundamental, let's make sure it's, your products are really solving the problems for your consumers and then keep at it. And it's extremely exciting times. And I think that the world will be very different five to 10 years from now the total picture of a customer is changing. And so we're lucky and I'm excited to be part of it.
Peter Mahoney: [00:33:54] That's great.
Ken, great advice. And in the other part we talked about right before, is that all are looking for growth it's right under your nose. You just have to focus on that post purchase engagement.
I think that's it. Great. I think we're we're wrapping up. So Kelsey, why don't you take
Ken Rapp: [00:34:10] us out?
Kelsey Krapf: [00:34:11] Yes. Thank you so much for your time today, Ken and great conversation loved learning about the post-sale experience. Make sure to follow The Next CMO and Plannuh on Twitter and LinkedIn. And if you have any ideas for topics or guests, you can visit our website or email them to email@example.com.
Have a great day, everyone.
Ken Rapp: [00:34:30] Thanks Ken.