Making social CRM tools effective

Just putting social CRM tools into place is a strategy for failure. Here's some guidance on how to choose the tools your business needs.

Social CRM is the new buzzphrase in the business world, and with good reason. As social media explodes among businesses and customers, monitoring, managing and exploiting it become essential tasks for almost any business. Companies are anxious to meet customers where they are in the social media realm -- whether that's on Twitter, YouTube, Google+, Facebook or Pinterest, and so on -- but they need the right tools to get them there.

Social CRM software works in conjunction with traditional CRM systems to track customer behavior, as a tool that is part of a social media strategy. And having a social media strategy is no longer optional, said Gartner analyst Jenny Sussin. It's necessary. Companies are buying into that concept, literally. According to Sussin's report, by 2016, business-to-business will account for 40% of spending on social software and business services.

For many businesses, "Having a Facebook page is almost equivalent to having a website," Sussin said. "It's a symbolic presence." Even for those companies [that] don't seek their customers on the common social sites, it's important to be in touch with that world, she said. "People are talking about you, regardless of whether you're listening," she added.

If your business is considering social CRM tools, think about these critical questions to help your investment have the best chance of success.

Key questions to consider when you purchase a social CRM tool

Questions for your business

What's your problem? Identifying your company's pain point is fundamental. Sure, businesses are moving to social CRM, but unless you know how and why your organization needs it, it's difficult to get results.

Sussin recommended that you first determine your goals in terms of specific business outcomes, such as to increase revenue, decrease cost or decrease risk. Then you can target where you need your social CRM tool, i.e., in marketing, sales, digital commerce, or customer service and support.

Customers think they can buy one product and it will have all of the features they need.
Ashley Verrillcontent strategist, Software Advice

Do you need more than one tool? Ashley Verrill, a content strategist at Software Advice, said that social CRM customers are often surprised when they realize that solving their need is more a layering process than one-stop shopping. "Customers think they can buy one product and it will have all of the features they need," she said. Although the movement is toward that broad approach, much of the growth has been with niche companies, which offer options for small and big needs. Some smaller companies, for example, may need only an elementary listening product like TweetDeck, while larger companies might want something more advanced like Provenir's "engagement hub," which looks at customers through various points of contact, from traditional CRM to social media conversation and more.

What are your metrics for success? Nearly one-third of the companies that are actively engaged in social CRM do not have defined metrics for success, Gartner's Sussin said, adding that those companies are spending a lot of money and using a lot of resources without being able to identify their ROI. That's because many people don't know how to dive deeper into the metrics they already have, to find useful meaning, she said. Developing a clear measurement is necessary to knowing whether the process is working or needs to be tweaked. Software Advice's Verrill agreed, adding that developing numerical and anecdotal benchmarks is necessary to measure improvement.

Questions for vendors

Does your social CRM tool work with your current system? Whether you are adding the first layer of a social CRM tool or the seventh, ensuring that they all work efficiently is essential, Sussin said. Some products have robust partnerships with other products, which helps ensure the tools collaborate well.

How is pricing determined? Surprisingly, there is no standard for pricing, Sussin said. Some vendors charge based on usage, as in how many Twitter ads are used, while others charge by the number of topics, dashboards, campaigns, queries or profiles. Others charge by mentions. What makes sense for your company? The McDonald's fast food chain, for example, would most likely not want to be charged by mentions, but a less well-known company might find that pricing strategy reasonable.

How is the customer service? As in most businesses, the quality of customer service can be the deal breaker. Sussin said that in addition to pricing, the customer service relationship -- as opposed to the tech aspect -- is the most common reason customers change or stay with a vendor. Check references from other customers to see if the prospective vendor is likely to treat you well even after the sale.

The social aspect of business is here to stay. Now, businesses must understand how to integrate and use social to enhance all areas of an organization. Social CRM systems can enhance business performance, but only if you ask the right questions and select or create a system of tools and strategies that best meet your business needs.

Next Steps

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This was first published in May 2014

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