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Michael Singer

Enterprise Needs to Embrace Social CRM

Written by Michael Singer
5/14/2010 5 comments
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How's that Social Media strategy of yours shaping up? Feeling like you're playing catchup with customers? Have you integrated it yet with your customer relationship management systems? No? Well, take a tip from the experts.

Last year, Maytag learned the hard way that irate consumers wielding Twitter accounts can be more devastating than disappointing Wall Street. Heather Armstrong, who writes the personal blog Dooce was burned only once by the company last year, but she left a stain on the appliance maker with a swath of statements to her more than 1 million followers.

Maytag has since cleaned up its mess.

Similarly, the makers of children's medication such as Motrin endured the wrath of mothers everywhere when response to a recall of some of the products was not met with swift action.

In both cases, the companies had brilliant CRM systems and had been dabbling in social media to interact with customers. But neither saw the benefit of linking the two together.

This is why more enterprises need to adopt social CRM. And by social CRM, let's take consultant Esteban Kolsky's definition that it is about strategically setting long-term goals for working better with your clients and/or customers, and improving your organization in the process.

Knexus CEO Graeme Foux says the impact of outlets like Twitter, Yelp, Facebook, and others has been to cut organizations out of the loop, losing control of the customer relationship.

"Consumers have tasted freedom to connect, share and talk, benefiting from more timely, relevant and trusted interactions," Foux said in a recent post. "This is a profound change, leaving companies with little (or more likely no) hope of wrestling back control and re-establishing previous levels of influence. No wonder social media monitoring tools are red-hot, as companies scramble to re-engage with the disparate conversations taking place on the Web about them, but not with them."

Instead, Foux says, social CRM should be about companies attempting to get back into the conversations controlled by the customer, through listening and engaging to build trust and value.

So what's an enterprise to do? Jeremiah Owyang, analyst and partner at the Altimeter Group, says most organizations start their initiatives by building out the "Five M's" (monitoring, mapping, management, middleware, measurement) and deploying a customer insight program. But real-time is not fast enough. Enterprises instead need to be able to anticipate what customers are going to say and do in order to keep up.

"Companies are unable to scale to meet the needs of social," Owyang said in a recent blog post. "No matter how many community managers Dell and Comcast Cares hires to support, they'll never be able to match the number of active customers. They need tools, and they need them now."

The graphic below shows 18 different points where Owyang suggests companies focus their efforts in engaging and integrating their social networking strategy with their current CRM systems.

The main takeaway here is reducing risk means that enterprises need to master one thing at a time and then layer in more advanced capabilities. Starting out could be as easy as mapping the biggest pain points in the company and prioritizing use cases based on business value.

Given that the average consumer has had a few years headstart in using and communicating through social networks, it could be argued that getting a better handle on social CRM is mission-critical.

— Michael Singer, Senior Editor at Internet Evolution, is focused on executive (Executive Clan) and midmarket (Midmarket Clan) issues.

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Brian Newby
IQ Crew
Tuesday May 18, 2010 2:49:22 PM
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I guess there's a bit of a pardox in implementing this.  The bigger the company, the more it makes sense and more affordable it is to have someone monitor sentiment of your brands and the buzz where you are being discussed.  On the other hand, the bigger the company, the more general the analysis.

You really have to have people in the trenches monitoring and making strategic decisions as a result of this sentiment.  Otherwise, triggering words may go unnoticed or, worse maybe, the company might overly react to something that it would have been better if it was allowed to die on its own.

I definitely see the value in proactively tracking customers and proactively addressing things.  I just don't know that many companies are capable of executing this where demonstrated results can be shown.

Michael Singer
IQ Crew
Monday May 17, 2010 6:15:09 PM
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Brian,

Great points. I think to help decern between customer lifecycle management and customer experience, Social CRM takes a more forward-thinking approach to CRM and really attempts to get inside the mind of the customer's needs before it becomes a problem.

Take for intance the Maytag example. While the customer was obviously dissapointed with the product (that happens to the best of us) the company chose not to take seriously her threats to go public with her complaint.

While that kind of threat seems ludicrous five years ago, a better Social CRM approach would allow the agent to cross reference other databases to snuff out the irate customer.

Better yet, allow for a varied social approach to interact with customers and even allow them to rely on each other for assistance. Ask the question at the management level: "Assume our customers are Web savvy. What do we need to do to prevent our brand from taking a major hit?"

I don't know if Maytag's outcome with this customer could have come out better strictly using a customer lifecycle management suite.

Michael Singer
IQ Crew
Monday May 17, 2010 6:06:16 PM
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thanks David,

I agree that midmarket companies are perfect for this kind of assesment.

I'm interested to hear if any of our readers would like to chat about their experience using Social CRM and how it helped them.

 

 

Brian Newby
IQ Crew
Sunday May 16, 2010 8:44:39 PM
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Michael:

I've seen this framework floating around for a couple of weeks and it's hard to argue against conceptually.  Clearly, you've bought in.

Don't you think beyond the earliest adopters this framework runs the risk of simply being a buzzword, something that many companies approach but, in the end, define in their own terms and, potentially, poorly execute.

I know that's a cynical view, but I've seen customer lifetime management, customer experience, share of wallet, and the balanced scorecard, for instance, defined in companies' own terms, implemented poorly, and almost having a negative effect upon employees.  It seems to me that it's better to adopt some of the concepts but to absolutely avoid calling it Social CRM.

DavidSilversmith
Thinkernetter
Friday May 14, 2010 10:04:53 PM
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Excellent framework with the 18 cases for CRM in the social world.  Too many companies just do social media because everybody else is doing social media or because it is popular.

Using a framework and setting clear goals is clearly the way that an organization should tackle this beast.  And you can't tackle all of them and some might not be as critical for your organization - you pick the areas with the most potential for your business.

Great framework - thanks for sharing this!

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