We spend a lot of time on this chat discussing social media and marketing with details like implementing, measuring, strategizing, executing,
engaging, etc. Let’s say we dial it in and our community efforts are going great and growing quickly. I say, SO WHAT! If you’re not converting these prospects and customers to do something then who cares. All this social stuff doesn’t matter if you don’t sell more stuff or keep existing customers on board longer by providing better service. Another way to look at it is turning regular customers into advocates and detractors into believers. This happens when you engage the customer quickly, meet expectations, deliver quality and consistency over time in an open and transparent way. Companies manage these interactions today using internal tracking systems like Customer Relationship Management (CRM). But wait, customers are not using old ways to communicate, they are using new ways to engage and interact with social tools. this leaves companies scrambling to figure out how to engage and interact from their internal legacy systems. Along comes Social CRM.
Everyone is trying to define Social CRM (great resource from Bob Thompson) in their own way and yet no one definition quite fits all needs yet. One definition by Paul Greenberg makes a lot more sense than many others I’ve seen. He says:
CRM is a philosophy & a business strategy, supported by a technology platform, business rules, workflow, processes & social characteristics, designed to engage the customer in a collaborative conversation in order to provide mutually beneficial value in a trusted & transparent business environment. It’s the company’s response to the customer’s ownership of the conversation.
But we are not here to define it, our intent is to educate a new legion of corporate soldiers - hell bent on infusing their companies with social goodness both externally and internally. So what does Social CRM look like? Here’s a possibility:
- Traditional CRM: (sales) prospects become leads, leads become accounts and from accounts come opportunities. Sales people are managed with activity levels (# of calls, emails), funnels are staged and it becomes more operationally focused (read: process focused not customer focused)
- Social CRM: in an online home improvement Q&A, a homeowner asks “what goes better on a kitchen floor, wood, carpet or tile?” A professional from a home improvement big box store responds with “Tile, because wood might warp with water spills and carpet will hide food that drops. I am going to forward you a direct line to our local store and a 15% coupon on flooring tile. Come in this weekend and I’ll make sure Joe is available to walk you through the options in person.” CRM is updated, Joe at store is notified and homeowner is sent an email with a “Tweet This” link on your experience. The new measurement might be interactions started, prospects referred and conversational intent.
A couple of things are happening here. 1) Sales forces must change the “50 calls/day = 10 meetings /week =1 sale/month” sales by the numbers approach to an approach that engages with prospects and their needs and over-delivers with solutions that are relevant at the time. 2) Systems must be able to support this distributed engagement and broaden the ownership roles across many levels of a customer taking what is traditionally an inside-out approach and integrating more of an outside-in model.
To help us make sense of this all, we’ve invited Aaron Strout to help us moderate the topic this week. Aaron is a proven professional in this space working from both the vendor and customer side, and is a social heavyweight for sure. We’ll need a heavywieght as we explore this relatively new topic of Social CRM and begin to identify places to consider implementing within our collective companies. The chat will consist of 3 questions as usual coming 20 minutes apart and starting at 12 noon EST. Join in by following #socialmedia through Twitter or to make it easier follow our LIVE page during the event. The topic:
Social CRM – Lipstick on CRM or Transformational Business Model?
Q1: How does adding social make CRM better?
Q2: If social is front end & CRM is back end, what information is important to capture into CRM?
Q3: How can Social CRM help improve conversion (cover sales, service, support)?
Tags: aaron strout, Business, change management, CRM, customer relationship management, lipstick, Social CRM, social media
[...] Social CRM – Lipstick on CRM or Transformational Business Model? [...]
Hey Jason,
Amen to what you’re saying. Unless this stuff gets applied in the business world (and other places in the world too in a different sense), none of the discussions mean much at all – other than self congratulations and self-aggrandizement. I think we know a few things. The social customer is a real human being who now communicates differently and trusts differently. Traditional CRM has a purpose that still remains valid. It helps to automate processes and capture data and makes some of the work that goes into running a business more efficient and even more effective. The early failure rates of CRM were due to the immaturity of the technology and the practices around it. Now its a healthy $13 billion industry because there are sufficient success rates for businesses to risk the investment. But it isn’t enough anymore. What we have to do now is to respond to the new kinds of communication and the new way of trusting that people have. Note I didn’t say customers here. The transformation is social, not business. This is a revolution in how we communicate – 3.3. billion cell phones, texting, social networks like Facebook, etc. and the use of the web for one to one and one to many instantaneous communication has dramatically transformed both how we actually communicate and what people expect of those communications. All institutions are impacted by this – businesses are just one set of those. People have changed – not customers per se. They wear the hat of a customer when they interact with businesses. Since we’re concerned with business primarily, then we have to figure out what are the ways that businesses can respond to those changed customers. That means the use of technologies of course. It also means devising a strategy and a program so that the technologies and processes are appropriate to the response needed to the new expectations of the customer. Its not an easy thing to do either. As part of my work, I have two consulting “domains” for the want of a better term. I do vendor consulting (meaning I consult with enterprise technology vendors – or pure CRM vendors too, or social media vendors for that matter). But I also have a practitioner “practice” – meaning I develop strategies for companies that are implementing either traditional CRM, social media or social CRM. What I find interesting is that the these vendors all have certain aspects in common. When I work with them, what they want is – a. an understanding of the overall picture and what they have to deal with and then b. Incremental approaches – biting off key pieces of a program that they can handle – so perhaps its an advocacy program or a customer service program that incorporates social channels or something as simple as a Facebook page and a protocol to go with it. They may want a simple salesforce automation implementation. In other words, they adapt what they think that they can do, given their business imperatives. We don’t have to get grand all the time even when the big picture is new, a bit frightening and very very exciting. The social CRM strategy needs to be consistently based on the best means to engage the customer, rather than just manage them. But it doesn’t mean DON’T manage the processes and data. It means use them differently to help you deal with this newly empowered customer. Tailor it to your specific business. Social CRM acknowledges that a. a higher percentage of customers in 2009 and beyond will be different than the customers of 2003 – more engaged, more empowered, more social, more peer-trusting and more conversant with the tools they need to communicate with those peers. Businesses have to figure out the best way to respond to them – without denigrating their business objectives. While we all chatter on about the theory, there are a significant number of businesses adopting new models from mega giants like Procter & Gamble and Samsung to small companies such as Karmaloop and Threadless. Countless successes exist with measurable ROI – meaning valued business results.
All in all, Social CRM is another approach to a new customer. The key is that the customer is different. Even the critics and naysayers recognize that. What we need are the strategies, business models, processes, technologies, corporate cultures etc. to meet the requirements of both the new customers and the businesses trying to engage them.
Good post. As Bob Thompson noted in his piece, my definition of Social CRM is fairly simple:
“Social CRM is CRM Next, a superset of what we consider today’s CRM solutions. CRM is not just software. It is people first, process second, tools third. ”
This is the promise of what traditional CRM could grow into. However, as my thinking has evolved it has become clear that CRM is a failed framework (and tools) and we should be seeking a new way of thinking, not just building off of the old models that have led to 50%+ CRM failure rates. Instead of repeating my current thinking, check out my latest post here:
http://johnfmoore.wordpress.com/2009/10/09/customers-not-vendors-need-to-steer-social-business-design/
which explains the fact that Social Business Design is what comes next and how customers, not vendors, must lead the way.
Evolutionary approaches to CRM will only lead to decades of additional failure and pain for corporate customers.
John Moore
http://twitter.com/JohnFMoore
Jason,
Excellent chat you have planned, and I think that this is probably the healthiest debate. As Paul said above, we need to take the debate to the business – not expect the business to come to our community to talk about. There is little that I can add to what Paul said, as we agree in most ways about this. It is not a revolution – it’s an evolution. It is not a “forklift” model implementation, it is about integrating CRM (as you know it, warts and all) into the larger canvas of the Social Business.
Truth is that whether SCRM comes of age or not,the customer has already began their change and as a discipline that aligns itself with working with customers (the term management is there, but not many people see it that way anymore) across all functions, CRM has to have a seat at the table. Too pretentious? Maybe, but keep in mind that the best practices, lessons learned, and the way to do things that Paul mentioned above (slow, progressive, piece-meal, adaptable) is the value-add we bring to the table.
The hype may surround SCRM, but those of us who have been working this for a while know that when the noise ends all that is left is good, solid practices to move CRM forward. And that is what we are talking about.
Final thing, and feel free to edit this out from the comments before approving if you think it sounds spammy, I have a post in my blog that talks about the evolution towards SCRM that may be of interest to you and your readers (actually, I have lots of things on SCRM there – but this is the most interesting to read). The link is below, but as I said – feel free to get rid of all this stuff.
Thanks for helping the conversation.
http://www.estebankolsky.com/2009/09/08/a-brief-history-of-scrm/
Esteban, great comments. While I hope you are right, that when the hype ends we will have a great set of practices in place, just as often when the hype ends all that is left is silence, that and more failed projects, more disappointed customers.
We’re all pushing for the best, common sense, approaches possible, here’s to continuing the push forward.
John
All great comments here. What gets me is that ever since the late 90′s, it seems the banking industry has help morph the consumer expectations. Who goes into a bakc anymore? Online banking took hold and changed the way consumers think about interacting as it’s much easier to go online when you want to and check your checking account balance than to physically go into the bank when they wany to be open. This all seems a natural progression from that example. The way we as consumer think about engaging with the Brands we associate with has certainly changed , now we’ll see if the Brands do. Thanks all for helping move this conversatoin forward and help us all to think more completely about such opportunities.
I always had a problem with interpreting CrM as managing the customers, as oppose to managing the relationships (cRM), but in practice a lot of strategies were build on that unfortunate approach and Paul is right on the money again, as he usually is. The attempts to utilize the existing (legacy) business processes to manage social customer engagements will be ineffective and uneconomical.
The more fundamental change may come from reevaluating the reasons for engaging the customer – companies always wanted to market to and to sell to, both represent a push engagement model, more effectively and to service (push/pull engagement) more efficiently. These are already being explored by a number of vendors and companies, with a various degrees of success.
[...] This great question was posed by Jason Breed’s #socialmedia and moderated by Social Marketer Aaron Strout. The post raised some very good and specific questions, but the comments got me really thinking. Particularly this one from Paul Greenberg: The social CRM strategy needs to be consistently based on the best means to engage the customer, rather than just manage them. But it doesn’t mean DON’T manage the processes and data. It means use them differently to help you deal with this newly empowered customer. [...]
Anything associated with Aaron Strout will not suck – so you’ve now got me as a fan. By the way, who is the author of this post? Am I blind?
Cheers, Adam
Adam, thanks for the note. Agreed on Aaron. He can bring it no matter what the topic. I typically author the posts you see in our topics section. Marc Meyer and I manage the site and Marc does most of the recruiting of moderators each week. Based on our moderators, we jointly develop topics that will engage discussions geared to drive the industry forward.
Glad you enjoyed this one. Hope to see you around again. (every Tuesday noon EST) Let me know if I can help with anything else.
Jason
This is a great post. I really enjoyed reading it and I’m passing it around to everyone I work with.
The link to Bob Thompson’s post is a great one as well.
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