Social CRM demands a solid business case

While some of the benefits of embarking on a social media initiative tied to CRM may be "understood," the business case still needs to be laid out carefully.

The social Web can be an unforgiving place for the unwary business.

Consider, when director Kevin Smith was kicked off a Southwest flight for being overweight, Smith retaliated by tweeting about the unfair treatment and rallying his million-plus fans on Twitter.

An unhappy customer of United Airlines took to YouTube to share his feelings about United’s baggage handling practices with a self-recorded video titled United Breaks Guitars.

Candy maker Nestle has been smeared on Facebook for allegedly buying palm oil from a supplier that destroys rain forests.

They’re not the only examples of companies caught unprepared by the advent of social media. The problem, experts note, is not that these companies have committed such terrible crimes but that their interactions with customers have become prime-time viewing for millions of other customers and prospects.

"Smith's got 1.7 million Twitter followers, and everyone saw the interaction between Southwest and him. It put a lot of pressure on the company," said Jacob Morgan, principal of the Chess Media Group, a social media consultancy in San Francisco. "With a public forum like Facebook, there's no time to run it through legal or get approval from all departments."

The business case for social CRM

While those anecdotes make a stark point that social media is a risky place to be, they also illustrate the importance of having a business strategy for dealing with social channels.  

Ray Wang, a social media analyst and a partner with the Altimeter Group, a technology research and consulting firm based in San Mateo, Calif., notes that there are many reasons why a business might invest in social CRM, which includes sales, marketing/PR, and customer service.

Wang and Altimeter analyst Jeremiah Owyang recently released a report, Social CRM: The New Rules of Relationship Management, which lays out 18 separate use cases for social media, including:

•         Social customer Insights

•         Rapid social response (quick defense in a PR crisis, often with loyal customers serving as the best defenders)

•         Social campaign tracking

•         Social sales insights (finding out where your customers hang out online and targeting sales efforts for maximum return)

•         Lead generation

•         Peer-2-Peer unpaid armies, which empowers the hundreds or thousands of volunteer fans of a company to provide advice and support to other customers

•         “Crowdsourced” R&D, a concept where your volunteer fans again provide free help by contributing solutions to problems, test demos, and suggest requirements for upgrades and new products

iRobot Corp., which manufactures robotic devices for the military and home consumer market, developed its business case slowly. The company learned that customers were discussing iRobot products on Twitter when a colleague showed director of global technical support Maryellen Abreu a complaint that someone had posted to the microblogging network. So Abreu began searching Twitter and Facebook, and created iRobot accounts on both channels, with the goal of providing customer support.

She uses Google Alerts and RightNow Technologies Cloud Monitor to track mentions of the company’s name or product names on channels that include Twitter, Facebook and YouTube. They also opened Facebook communities for uses of their government robots and another for consumers who own or are interested in Roomba, the consumer bot.

“When we did searches, we realized we were on a huge number of Facebook pages already,” Abreu said. “So now I can reach out to them, with an apology or answer.”

Besides keeping tabs on what customers are saying, the online media gives the company a chance to provide on-the-fly technical support, sometimes politely intervening if they see another iRobot user giving wrong advice online.

“We’ve had random technical people suggesting things like fixing a Roomba with a butter knife, and other dangerous things. We need to make sure we’re out there,” Abreu said.

On other hand, many customers are technically savvy, and having a cadre of volunteer tech support workers can be a useful way to expand a company’s ability to troubleshoot customer problems, without adding to the payroll.

Socially engaged customers can also be used for surveys and polls, to get quick feedback on new policies or products, and to generate ideas for products and services. Of course, they are also ideal advocates for a product or company and may positively affect sales by providing positive reviews and comments to their own Twitter or Facebook followers.

But whether the business goal is to boost sales, expand marketing efforts, or improve customer service, the key motivation for using social channels to do so is the company’s desire to have a conversation with its customers – to both talk and listen, said Allen Bonde, a social CRM consultant with Evoke CRM Partners in Franklin, Mass. If a business just wants to collect data but not engage the customer, or wants to put out information without taking feedback, then social channels aren’t the right place to be.

“Social CRM is an added dimension of CRM and should tie back to the organization’s existing CRM systems,” Bonde said.

What all business use cases for social CRM have in common, he said, is that they put the customer in the driver’s seat, something that traditional CRM does not.

“You’re setting up a two-way discussion with customers and turning traditional CRM inside out. Traditional CRM is very process oriented, and the conversation is driven by the organization, or in the case of customer service, by a specific problem the customer has,” Bonde said. “The goal with social CRM is to provide a higher level of engagement – to be listening as much as talking.”

Making business sense of social data

Just as social CRM is considered a part of an organization’s regular CRM efforts, the same metrics used to judge CRM can be used to evaluate a social undertaking – reduction in customer service calls or costs, improvement in customer satisfaction scores, increase in sales leads generated, increase in brand exposure, and so forth.

“The business hasn’t changed, it’s just added another way to interact with customers. So people have to ask themselves: What’s the mission? What are the business goals?” said Esteban Kolsky, a social media analyst with ThinkJar in New York.

What is different are the ways a social media campaign is monitored and evaluated. Organizations should measure metrics such as the number of re-tweets – Twitter messages forwarded to friends – or the use of keywords in posts or tweets, or how many are bookmarking a particular blog entry, or the percentage of conversations about a product that are negative vs. positive. There are lots of ways to evaluate social media, and plenty of software tools on the market to do so.

Dig deeper on Social CRM and Web 2.0

Pro+

Features

Enjoy the benefits of Pro+ membership, learn more and join.

0 comments

Oldest 

Forgot Password?

No problem! Submit your e-mail address below. We'll send you an email containing your password.

Your password has been sent to:

SearchBusinessAnalytics

SearchDataManagement

SearchSAP

SearchOracle

SearchAWS

SearchContentManagement

Close