While Social CRM is a much-discussed concept today, there’s little clarity around marketing’s latest buzzword. What exactly is Social CRM, how does it benefit marketers, and where is it being utilized successfully?
Wanted: a definitive definition
A precise, agreed-upon definition of Social CRM has been quite elusive. Experts offer a wide range of Social CRM descriptions, from the comprehensive:
“Social CRM is a philosophy and a business strategy, supported by a technology platform, business units, processes, and social characteristics, designed to engage the customer in a collaborative conversation in order to provide mutually beneficial value in a trusted and transparent business environment. It’s the company’s response to the customer’s ownership of the conversation.” — Paul Greenberg, author of “CRM at the Speed of Light.”
To the simple:
“Social CRM is strategy to make conversations with your customers who bring you money and make your customers happy.” — Adam Metz, author of “The Social Customer.”
Rather than debate the many existing definitions, here’s something clear and accurate: “Social CRM is engaging in a customer dialogue to ensure the best product and service experience, by first obtaining customers’ input and then responding to their preferences.”
Social CRM is not a stand-alone initiative, but a key CRM component that increases the ability to maximize customer value. Social CRM focuses on managing the customer dialogue, enabling more two-way connections and collaboration to deliver superior service and strengthen the relationship.
Why is Social CRM critically important? Customers can now help build or shrink a business using outlets brands do not control, owning the conversation as much as or even more than marketers. Because customer opinions are the most trusted information source, brands cannot ignore this dialogue.
The most valuable customers today are not solely those purchasing the most, but also those advocating passionately. Some customers are so engaged they meet Malcolm Gladwell’s 10,000 hour rule to be experts on your business. Tapping into this enthusiasm can drive significant growth, and addressing customer concerns expressed in social forums can stem potential crises.
Among the potential benefits of Social CRM are:
- Real-time customer insights and rapid response
- Prompt reaction to positive or negative news
- Alignment of marketing and product development with customer preferences
- Enablement of social commerce transactions
- Measurement of social ROI
- Immediate viral distribution of key info
A 2010 white paper, “The 18 Use Cases of Social CRM, the New Rules of Relationship Management” by Jeremiah Owyang and Ray Wang, identified the strongest uses of Social CRM. These and suggested additions boost customer engagement and satisfaction, delivering business value through increased revenues and efficiencies.
The most successful approach typically encompasses cross-functional management of customer dialogue, with a central steering committee, and decentralized implementation by individual brands. Here are a few examples of social CRM successes:
- Best Buy’s community team monitors social media for customers needing support, answering hundreds of Twitter questions daily with its 2,000-member Twelpforce. Best Buy claims this engagement of both employees and customers reduced customer complaints over 20 percent.
- FedEx monitors social sites and responds to customer needs real-time. When millions of YouTube viewers witnessed a FedEx delivery person carelessly throwing a video monitor into someone’s yard, FedEx promptly apologized on YouTube, promising a replacement product, employee discipline, and retraining.
- American Express OPEN launched YourBuzz, which won the 2011 SAMMY Award for Best Social CRM Campaign. It enables small business owners, largely social media novices, to monitor customer reviews and ratings across leading social media platforms (e.g., Yelp, CitySearch, Facebook, Twitter), identify influencers, and respond in near real-time to conversations.
- Novartis CML Earth is a global community of over 2,000 patients, caregivers, HCPs, and support organizations. It provides education about chronic myeloid leukemia, peer-to-peer connection to ask questions, receive support, and share experiences, giving Novartis valuable insights about customer needs. To manage the regulatory burden, the unbranded site prohibits postings about adverse events, specific treatments, or companies.
Social CRM success stories abound from companies like Harley Davidson, Comcast, Victoria’s Secret, TurboTax, and J&J BabyCenter, to name a few.
While a relatively new concept, Social CRM is already delivering results for many leading brands. Social media’s real-time customer dialogue and engagement augments the power of CRM, to address customer needs in a more timely, personally relevant, and effective way than previously possible.