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The ROI of Enterprise Webcasting: Justifying the Expense

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Enterprises have been delivering video over the internet since around 1997, and we’re well past the phase of delivering video for video’s sake. If your CFO asked you, “Has all this streaming video even remotely paid for itself?” could you answer in the affirmative -- and back it up? We went hunting for use cases where streaming media was clearly financially justified.

Obviously, this can happen in multiple ways. First, streaming media can provide a cheaper alternative to an existing practice. Second, it can open new revenue opportunities. Finally, it can allow you to extend your marketing reach beyond what was available using traditional technologies. Here are six mini-case studies that are examples of these practices.

Lockheed Martin: Cutting Travel Costs

Eric Hards is the manager of digital media services for Lockheed Martin. He runs an internal group in the company that supports multiple business units, primarily producing executive- and director-level all-hands webcasts as well as internal and external training events. Hards’ team produces between 40 and 60 live events per year, with an average audience size of around 1,800 viewers and a peak audience of around 4,000 viewers.

Hards uses the Sonic Foundry Mediasite to capture and deliver live and on demand presentations. Interestingly, Hards chose Sonic Foundry because it was one of the few systems that didn’t require him to install software on the locked-down computers in conference rooms, or to ask presenters to deliver slides a day or two before the event. Instead, the Mediasite capture stations accept and capture the graphics output from the presenter’s computer in real time, so there’s no need to install software or bug the presenter for slides in advance.

Before implementing the Mediasite solution, most meetings were face-to-face, which meant lots of expenses. Hards’ rule of thumb estimate of travel cost for each attendee of a two-day event was around $2,000, so a 50-person event started at around $100,000. That’s before you add the cost of facilities and other associated expenses.

Hards wouldn’t disclose the costs of the Mediasite system itself, which probably would be irrelevant anyway because pricing depends upon a number of factors, including company size. He did note that Lockheed Martin considers the Mediasite system a centralized enterprise service with the cost spread over the various business units.

Beyond the allocated costs, if a business unit wants to host a webcast, it needs to buy and maintain its own lecture capture station from Sonic Foundry, which costs $25,000 for the desktop version and $27,000 for the mobile version, according to the company. Most business units already have cameras and related audio and lighting gear, so the additional investment in hardware was minimal in most cases. They also had knowledgeable shooters and audio technicians, and since webcasts are only held about once a month in most business units, they didn’t need to add personnel to run the units. Overall, Hards estimated that most business units would easily recoup the costs of the capture station in 18 months or less.

Though Hards has never calculated the hard return on investment from the Mediasite system, he knows it’s saving Lockheed Martin money because he often gets requests from different business units to convert an existing live event to a webcast. As travel budgets get cut, an increasing number of business meetings, and particularly training sessions, are going virtual or hybrid, where local employees attend the meeting in person while others attend via Mediasite.

Hards noted that Lockheed Martin is also saving significant money by replacing managed teleconferencing services with a Mediasite webcast. Specifically, Lockheed Martin hosts many audio-only events where participants used to dial in over a third-party conferencing service, resulting in a significant bill for a one-hour event. Since most participants really didn’t need live interaction, however, Hards can produce an audio-only webcast at no real incremental cost to Lockheed Martin.

Centerplate: Cutting the Cost of Intercompany Communications

Centerplate is a hospitality company that handles concessions and fan services at approximately a quarter of NFL stadiums, in addition to other venues across the globe -- in 2014, the company will serve more than 115 million guests over 350 venues worldwide. If you had a burger at Mile High Stadium in Denver or a beer at Qualcomm Stadium in San Diego, chances are it was served by Centerplate.

The very nature of Centerplate’s business means that its workforce of more than 45,000 is scattered around the world, which complicates important communications. Last December, the company had an important announcement that significantly impacted global operations. In the past, upper management would have travelled around the U.S. and Europe for major company announcements and briefed employees in centralized locations, which was expensive, time-consuming, and failed to deliver the message quickly.

For example, to announce their recent merger with a U.K. company, 10 Centerplate executives flew to London and employees were brought in from around Europe, at an estimated cost of over $50,000. For other events, they tried audio-only bridge lines, which the company found unwieldy.

For the recent announcement, it was important to give everyone the same information all at once, in a personal manner, direct from the CEO. Centerplate broadcast the event live using Livestream. After considering several options, Bob Pascal, Centerplate’s chief marketing officer, chose Livestream because “they had the technology platform that could handle the bandwidth and speed, and because we were impressed with their personnel, particularly in customer service.”

Centerplate staffed the announcement with its own crew of three, with an interviewer chatting with the CEO, and on-demand clips interspersed throughout. The company handled all production, with Livestream encoding and distributing the stream. Pascal estimates that producing the live event cost less than $15,000, a significant savings over their previous events in cost as well as other non-monetary expenses like travel time.

Pascal was quick to note that the merger-related travel was “money well spent. Oftentimes you really do need to be face-to-face.” However, for major time-sensitive announcements in which it is imperative that everyone has an opportunity to see and hear the information at once, he wanted a solution that delivered as close to the live event experience as possible. In a choice between personal, face-to-face delivery and time sensitivity, the phased delivery of a “road show” style tour often diluted the impact of the message.

“Our business depends upon getting people to live events, and we believe in the power of the gathering,” he says. “But when assembling our entire team together in person proved impractical due to numbers, geography, and time, we found Livestream was able to add a sense of immediacy, energy and excitement that we were seeking. In short, Livestream most closely replicated the live event experience.”

AICTC: Cutting Travel Costs and Reducing the Carbon Footprint

The American Institute of Certified Tax Coaches (AICTC) trains and certifies tax professionals with the Certified Tax Coach (CTC) designation. To gain and retain certification, members must attend an initial three-day training session followed by 25 hours of continuing professional education each year.

The organization was founded in San Diego in 2009 by CPA Dominique Molina. Initially, the organization conducted all training, continuing education, and support at centralized locations around the country, which meant that she and her instructors had to travel to these meetings, as did members not located in that particular training location. Not only was this costly in terms of time and money, but it also limited their ability to perform these activities and deliver other benefits of the organization, like networking. After several years of this status quo, Molina “wanted to find a way to increase these services without additional travel and expense.”

After evaluating several web conferencing systems, Molina chose Citrix GoToMeeting and GoToWebinar for several specific reasons. First, the AICTC had to document class participation to award CPE credits, which GoToWebinar’s polling and reporting capabilities enabled.

Second was the ability to share the presenter’s screen in real time, which is one of the major differences between most webcast and conferencing systems. Specifically, with most webcast systems, you upload a PowerPoint deck that gets displayed during the event, usually without any animations or transitions. In contrast, conferencing systems like GoToWebinar broadcast whatever is showing on the presenter’s screen. Molina obviously favored the second approach. “It is imperative to our business that we share our screen and go through our slide presentation,” she says.

Overall, Molina estimates that the AICTC has reduced corporate travel costs by more than $100,000 per year, while saving their members the time and expense of travelling to the meetings. While Molina wouldn’t discuss her webcasting costs, GoToWebinar’s standard pricing for up to 500 attendees is $399/month, or $3,828 when paid in one lump sum for a year.

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