Yesterday I tweeted about an article on social CRM from Mashable (I tweet at http://twitter.com/MarketingLetter). For those of you interested in CRM or unhappy with the results you’re getting from your CRM efforts, this is a good place to start in understanding how to improve your program.
What is social CRM?
Social CRM or social customer relationship management is the integration of social media channels into Customer Relationship Management (CRM) platforms. Increasingly, CRM platforms support social media alongside traditional channels so customers can interact with businesses via their preferred channels. This means better customer service and greater marketing insight gathered from customer social media data. [source]
As this definition implies, social CRM must go beyond simply technology. It relies on understanding customer needs and providing for those needs on the platform that best suits your customer at any given point in time.
Responding to this, firms now host customer service hours across social platforms, monitor social platform, especially Twitter, so they can respond to customer complaints in a timely fashion, and encourage user-generated content that supports customer needs, such as addressing usage issues and recommending new uses.
CRM in the digital age
This article re-enforces some contentions I made in an earlier blog post — that CRM goes beyond technology and involves creating valuable relationships with customers. The article makes the statement “The name CRM stands for “customer relationship management,” which is a misnomer because the company no longer controls or manages the relationship –- the customer does”, which is really at the heart of our discussion on social CRM.
I frequently make the point that today’s consumer is more “digital” and gets their information from online sources, especially from others in their social networks including Facebook, Twitter, Linkedin. Certainly, this is true — at least for some subset of consumers, such as millennials If these consumers make up a significant number in your target market, then tapping into the power of social networks is important for firm success (remember, however, that not everyone is digital and you need to take care of these non-digital customers as well).
Today, I make the important point that engaging in social CRM goes beyond technological solutions, involving listening, analyzing, relating, and acting on these digital customers in ways that reinforce their relationship to your brand.
Building a social CRM strategy
Here’s a nice diagram showing how to build on these network relationships to improve the profitability of the firm.
Image courtesy of E-Commerce Times
One nice element of this image is it recognizing the building customer relationships is a sequential process that starts with understanding and ends with improved performance, rather than expecting that improved performance is easily achieved with minimal effort.
Another aspect of the image I endorse is that it’s focused on actionable advice for achieving improvements at each step in the process of social CRM. Initial steps in the strategy involve understanding customers and your ability to satisfy them with building strategy, rather than simply jumping into social media without a plan. This helps ensure you’re able to achieve your goals, saves time and money, and makes your efforts more professional.
A final element I want to point out from this image, which packs a lot of punch in a small space, is the role of customers in promoting your brand. This isn’t something you do to customers but something you do with customers. That means you have to provide incentives for customers who choose to engage with you and your brand. It’s a tit-for-tat world out there so don’t expect to sustain continued engagement without providing some benefits.
Benefits might include small tokens such as call-outs to consumers who engage with you or supporting causes they believe in. Influencers might get more tangible rewards since they bring a large party to the table.
Storytelling in social CRM
Remember from old episodes of Cheers (or watch them on one of these oldies stations or Netflix) how everyone congregated at the bar to swap stories, gossip, or just hang out in a place where “everyone knows your name”. Digital consumers are looking for this type of community online since there are so few places to find it in the “real world”.
Whether they’re on Facebook, Second Life, or another social network, they’re hoping for the community. When firms interfere with this community through heavy-handed efforts to promote their business (like pop up ads, banner ads, or sponsored links) they risk wasting money, creating a poor brand image, encouraging negative comments, and may ultimately drive customers away (consider recent criticism of Facebook privacy and efforts to create alternative social networks).
Developing an online community should; therefore, be the long-term strategy for firms (along with shorter-term strategies that help pay the bills today). Community places the firm within the group, rather than outside, and makes the firm’s social spaces a place where consumers want to “hang out”. While they’re hanging out in the firm’s social space, they are building brand image for the firm, drawing others from their social network to space, talking favorably about the firm in other social networks, and becoming more likely to buy the firm’s products (and be loyal to these purchases).
What are some examples of firms that have built good online communities? How is a community built? How do you capitalize on these online communities without destroying customer value?
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