Social Media in CRM’s World
We hear a lot these days about how social media is fundamentally changing how we conduct business. With social media, consumers are broadcasting their experiences and preferences to their virtual networks – and at the same time, becoming increasingly influential and valuable to the companies that serve them.
Carolyn Baird, Communications Strategy Leader, North America, IBM Global Business Services, examined how companies are shifting from traditional CRM strategies to a Social CRM approach. In her study, “From Social Media to Social CRM,” published by the IBM Institute for Business Value, Baird argues that Social CRM -- the integration of social media into a company’s traditional CRM strategy -- is still in its early stages and that there is real opportunity for businesses to fully leverage social media provided they map out an approach that centers on meeting customer needs.
To better understand where the opportunities for companies lie, we spoke to Baird about her report.
Let’s talk about the use of social media in business today. Can you help us understand how companies are engaging in social and the relationship between social media and CRM?
Our study, “From Social Media to Social CRM” was released in two parts. The first part titled, “What Customers Want,” aimed to understand what triggers a customer to actually follow a company through social media. The second part, which goes to your question, is called “Reinventing the Customer Relationship,” where we looked at how companies are designing their social media programs to really respond to these customers.
What we found with this research is that the social media initiatives that are happening throughout many companies are often grassroots initiatives that are owned and managed within individual organizations or verticals. And these social media outreach efforts are not necessarily thought of as additional channels that need to be connected to the CRM applications that are in place. One of our key findings, in fact, was just how dispersed and fractured a lot of these social media programs are.
Based on your research, who typically “owns” the social media strategy? Who within the organization is responsible for social media?
When engaging with customers through social media, we found that marketing, public relations and sales really had the lion’s share of these social media activities. But we also found that up to 18 different functions had, to some degree, their own social media projects going on.
With all these employees using social media and potentially reaching out to customers, the question becomes, who really owns social media in a company? It is Marketing? Sales? Operations? IT? And if the answer is that no one group owns social, then how do you make sure that your CRM system aligns properly with all of these organically grown social media programs? Who is connecting the dots? Where are they connecting the dots?
The data revealed that the integration isn’t happening as much as it needs to. For most companies, social media and CRM are often disconnected. Businesses have to find a way to bring it together.
So it sounds like it’s not only about the ability of the technology to unite these interactions, it’s also about how to operationally bring it together.
Exactly. Are people who are launching social media initiatives even thinking about it as a potential CRM consideration? Based on our research, I would argue that for most companies they are not thinking of it that way. That’s why this notion of Social CRM is gaining momentum. Now that the customer is in control of the relationship, business not only needs to think about how to manage the relationship but also how to really facilitate a dialogue with the customer so that the customer’s needs are met as well as the business objectives. It’s a very different way of thinking.
How prepared are companies to incorporate social media into their CRM strategy?
We asked a lot of different questions about the things you need to have in place in order to move into a Social CRM mode. We asked things like: Do you have a social strategy? Do you have executive support for that social strategy? Are you able to integrate insights that you might capture as a result of these social dialogues? Do you have integrated governance models where you are able to establish social policies or provide training?
When we looked at these things all together – which we believe are foundational to really get to Social CRM from an operational perspective – we found that only about one-third of survey respondents have pieces and parts of it, but certainly not the whole story.
For example, we found that some companies might have established social governance policies and strong executive support. But when you look at whether they are doing training, maybe not so much. Or you have others that have a documented social strategy. But when it comes to being able to actually integrate insights across the board, they can’t. There are a lot of levers that have to be pulled in order to make Social CRM work and I would say we didn’t see very many companies that are doing it.
Are companies aware of all the work and all the pieces that are involved in making Social CRM a reality?
More and more they are recognizing it takes a lot of work to get it right. A high percentage, about 70 percent, acknowledge that social media is not going away. They believe it will fundamentally change the way they do business moving forward and that they absolutely have to have plans in place to incorporate it and make it a core channel for interacting with customers. They also feel very strongly that this interaction will actually increase their ability to generate more loyalty and advocacy for their business.
And that was one of the findings that I thought was so interesting. In the first paper, we talk about how customers aren’t so quick to agree that their feelings of loyalty toward a company will increase because they interact with them though social platforms. So, there may be a little bit of a disconnect between consumers and businesses. We call it the “advocacy paradox.” We found that most customers don’t interact with companies via social media because they want to feel connected to a brand, or feel part of a community. Most engage with companies to get something of tangible value. Discounts. Coupons. Exclusive access. It’s when businesses are able to deliver value on a regular basis that customer advocacy follows.
From a Social CRM perspective, where are we now?
Social CRM is a great idea, but execution can be a complex undertaking. The technology is there. But it might take a while for businesses to rally behind Social CRM operationally to execute on it. Executive leadership needs to have a strategy for Social CRM and dedicate the tools and resources to be able to pull it off. For many companies this represents a culture change – a change in the way businesses think about their customers and how they go to market. The companies that embrace this integrated approach will find it can be a true brand differentiator.
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