Social CRM: Yes, It’s The Real Deal, But That Hand’s Still Being Dealt
In the continuous hype cycle that is all things tech, “social” has become the latest flavor of everything.
For sure, we as IT industry analysts are major players in this cycle, albeit sometimes inadvertently. Even when we individually attempt to provide sober, nuanced, balanced, fact-based discussions of some new “social” this-or-that, we’re often stoking the popular mania. The bottom line is that yet another analyst is paying attention and tweeting thoughts on some trendy “social” topic. This fact can and often does get wrenched out of context and escalated wildly in the minds of some people who follow us.
Social CRM is still climbing the hype curve, and events such as this week’s Forrester CRM Jam on Twitter (#CRMjam, Wed. March 24- 1-3 p.m. USA EDT) will undoubtedly fuel that combustion. Of course, yours truly contributed to the buzzing conversation last week with this blogpost on the analytics component of social CRM. I hope you found that discussion useful—with enough new information to help you align social CRM with your analytics initiatives.
There’s a point in every hype cycle when you have to stop and ask if this is the proverbial “real deal,” or just a collective exercise in wishful thinking and speculative push of an unproven approach. Who’s actually implementing this technology, or actively considering it, and has anybody demonstrated any significant value from production applications? Where social CRM is concerned, my colleague Natalie Petouhoff (she Twitters at @drnatalie; me at @jameskobielus) are actively exploring the real deal behind social CRM. In particular, we’re looking into case studies of social CRM in the call center and throughout the customer engagement lifecycle.
We’re seeing growing adoption of social CRM solutions, but not enough yet to proclaim this a mature approach with well-documented ROI. The social CRM space, so far, is dominated by trial, evaluation, pilot, and other “dabbling” deployments, very few of which are at the payback stage. Likewise, social CRM solutions are still evolving, and it may be premature to declare market leaders in this segment. We should note, though, that Forrester is now working on a Wave that will show which vendors are the real deal in this and other key requirements for next-generation CRM platforms.
In a separate effort, Natalie and I are developing an ROI calculator to help Forrester customers assess how real the social CRM deal is for them, in terms of business justification. Given our role focus at Forrester, we’re scoping this out in terms of how the various roles in customer engagement processes will leverage social media in their jobs. The key business metric we’re focusing on is customer lifetime value. How can social media boost the net present value of customer relationships across all roles and touchpoints in the CRM process?
In developing your social CRM strategy, consider it with an eye toward infusing social media more completely into the following customer engagement processes:
- Brand monitoring process: This is the responsibility of the brand manager and marketing manager. Their primary functions involve using social media to assess customer awareness, track customer sentiment, and determine customer propensities.
- Lead conversion process: This is the responsibility of the sales manager, field sales personnel, and inside sales personnel. Their primary functions involve using social media to identify, qualify, and convert customer leads.
- Customer service process: This is the responsibility of the customer service manager and customer service agents. Their primary functions involve using social media to onboard, grow, and retain customer relationships
When evaluating social CRM platforms to support these processes, consider the following key criteria:
- Single view of customer: Does it allow you to maintain an aggregated repository of multi-channel customer intelligence that integrates social media content—such as blogs, Twitter tweets, and Facebook status updates—with batch and real-time feeds from your CRM applications, e-commerce systems, Web analytics platforms, enterprise data warehouses, online transaction processing systems, and other sources?
- Deep customer analytics: Does it provide you with analytics tools to support monitoring, measurement, exploration, query, and reporting on key customer metrics surfaced from social media and other CRM information? Per my discussion in this blogpost last month, you will need to consolidate this information in scalable data warehouses and business intelligence infrastructures to ensure high-quality decision support across all business roles in the social CRM process.
- Pervasive exception and escalation handling: Does it support workflows, alerting, exception handling, and automated escalation of problems that are identified, via social media, in such areas as customer awareness, sentiment, propensities, conversion, and satisfaction? Per my discussion in this blogpost last month, you will need to automate more and more of the exceptions and escalations as your social CRM initiatives grow. As you build out your social CRM initiative, consider embedding more predictive “next best offer” analytics in operational social CRM applications to yield maximum customer lifetime value.
Customers will view your social CRM initiative from a complementary angle: lifetime relationship optimization. They’ll ask: How can they use social media to get what they need from their ongoing relationship with your company?
Where the social CRM bottom line is concerned, the real deal is whether or not the customer opts to dump you because you didn’t engage them where they live. Some live primarily in Twitter, others in Facebook, still others in various blends of these and other channels.
Some customers will engage through any channel but social media, but those people will be fewer and fewer as today’s younger generation begins to dominate your target demographic.
Jim also blogs at http://blogs.forrester.com/james_kobielus.