Strategize before diving into social CRM

Will launching a social CRM initiative be more trouble than it's worth? Maybe, if the project isn't undertaken strategically.

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The only thing worse than doing nothing in social channels for CRM is, perhaps, doing the wrong thing.

When Nestle waded into social channels with its Facebook page, the company obviously didn't think it would become a target for angry environmentalists and others unhappy with Nestle's use of palm oil, which has been linked to deforestation in Indonesia. Instead of positive banter about Kit Kats vs. Nestle Crunch, Nestle's Facebook page got floods of postings urging a boycott of Nestle products.

Which leads to lesson No. 1 in social CRM: Customers will talk back.

“In Nestle's case, I'm not sure I would have started with a Facebook fan page right away,” comments Jacob Morgan, principal of the Chess Media Group, a social media consulting firm. “Social CRM is about building advocacy and improving the customer experience. If you're just out there to push a marketing message or listen to your customer, you're not really doing social CRM."

How social are your customers?

Different businesses and industries have different customer cultures and different goals from their social involvement.

For Phanfare, an online digital photo site, moving to social channels was a natural business decision based on three business needs: to give customers an easier way to upload their Phanfare photos to Facebook and other online places, to communicate with customers without spamming them, and to gain greater visibility for the business. Andrew Erlicson, CEO of Phanfare, said Facebook has proven to be the best channel for them so far.

"To some extent we went with our gut feeling, but we also did surveys of customers who said they wanted integration with Facebook," Erlicson said. "The reason I like Facebook, and why it's more successful for us than Twitter, is that it's low-impact and non-intrusive. You can have a dialogue with the customer without sending a lot of email."

Another company, TCHO, a small gourmet chocolate maker in San Francisco, is also leveraging Facebook to build brand image and, hopefully, sales. The company does 40% of its sales direct from its website, and 60% through retailers around the country, most of which are high-end groceries or candy shops. The company’s varied product line and its marketing campaign against slave-harvested cacao (from the Ivory Coast) helps it to attract young adults with a social conscience and enough money to indulge in $5 to $10 chocolate bars. TCHO is also a heavy user of Internet technology.

So when the company began looking for ways to build brand awareness, it looked at Facebook and Twitter. To increase referrals, it added the Crowd Factory’s Pop-To gadgets to its Facebook site. The Pop-To gadgets are clickable icons with different actions -- comment or review, or refer a friend -- which visitors to a website can click on to make their feelings known. The gadgets automatically post conversations to both Facebook and Twitter, thus combining the audiences.

According to TCHO's director of IT and direct sales, Cash Shurley, the campaign is designed to be fun and to build brand loyalty as well as direct sales.

“We want to build our fan base, create an exclusive feel to our site, keep our current customers and get new ones, and make sure our brand has a voice,” Shurley said.

Many channels to choose

The most commonly used social media are Facebook and Twitter, but there are plenty of other choices with different twists – YouTube, Hula and Kontain -- all of which enable people to upload videos and presence-related games like GoWalla and Foursquare, as well as customer support forums that can be on a company's own website or on Google; or even Usenet, chat rooms and "crowd sourcing" contests where users are asked to submit and vote on ideas; and, of course, blogs that allow company leaders to share their thoughts with customers and employees.  

No one channel will be sufficient for all of a company’s CRM needs, said Ray Wang, partner in The Altimeter Group, a social media consultancy.

“Organizations are going to be working with multiple types of channels because social networks are going to transcend different channels,” Wang said. “Businesses will need to follow a portfolio of things -- blogs, Twitter feeds, wikis, Facebook pages -- a host of mediums.”

"We use social media to keep people informed about music that's on sale, music that just came out, live music videos," said Cathy Halgas Nevins, vice president of corporate communications for eMusic, which posts music videos and artist Q&As to YouTube as well as Facebook.

For Jupiter Networks, a maker of networking equipment, it's been the community forums, based on its own website, that have proven the biggest draw for customers. Called J-Net, the forums allow customers and support people to have group discussions on technical issues, problems, new product releases and so forth. According to Todd Shimizu, director of communities at Juniper Networks, the J-Net community motivates customers to register and participate by offering prizes -- it recently ran a raffle for an iPod and other gear -- and by promoting active members to more senior titles.

"Those super users are incredibly important to the overall health of the community, and their reputation means a lot to them," Shimizu said. "People have rankings and different titles, and those mean a lot to people who are using these communities. It's a motivation to move up in title."

Social channels and B2B

Some companies engage in social channels in order to bolster connections with business partners, rather than with consumers. Business to business (B2B) communities have been around for several years but have taken on new momentum with the advent of new tools such as Twitter for instant communication with anyone; the LinkedIn network, for business professionals and entrepreneurs to make connections and advertise their resumes; and even Paypal and other transaction mediators, which enable faster and more secure payment for small transactions.

WeCanDo.Biz is a B2B community in the U.K. to which business owners can post their capabilities and connect with other colleagues. Unlike LinkedIn, it has a business-centric model and promotes B2B transactions. Businesses can leave endorsements for other businesses they like, exchange messages, browse the members' business directory, update its corporate profile, and also make use of a Twitter Sales Lead tool that enables searching on business keywords for prospects on Twitter.

To help companies determine where they should start, there are many social monitoring tools on the market -- some free, some not -- that track keywords and company mentions on a variety of channels. By using two or three monitoring tools, and lurking on some of the more promising channels, marketers and customer service professionals get a feel for the landscape.

That data can also be collected and run through analysis software to glean some insights into how customers view companies, what these customers have in common, what other products they like, where else they hang out online, and volumes of other insights, according to Esteban Kolsky, a social media analyst and CEO of ThinkJar.

“Once you run the feedback through analytics,” Kolsky said, “you've created actionable insight -- a summary of what your customers really want you to do.”

This was first published in April 2010

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