Oliver Trabert discusses how organisations can create real business value from social media initiatives and achieve a better understanding of its customers.
The last twelve months have demonstrated the extent to which social media websites can empower individuals. Whether it is the citizens of a repressive nation state or disgruntled customers of a multinational corporation, there has been a ‘social media revolution’.
There can be no more powerful illustration of social media enabling a group of people to bring about change for themselves, than the recent Arab Spring. This article explores social media revolution from the perspective of customers and how they are using channels to build relationships with brands in entirely new ways – leading to an evolution in CRM to meet the new challenges and opportunities offered by this trend.
The social media revolution has coincided with the rise of the ‘experience economy’ with the two trends mutually reinforcing crucial changes within CRM practice. As customers have become accustomed to the service economy, they have seen marketplaces become saturated by companies offering similar services; the key differentiator has become the experience.
This, in and of itself, would not have necessarily become a meaningful trend if social media had not, at the same time, allowed audiences to broadcast experiences instantaneously to a potential audience of thousands. Should this reach critical mass through sharing, then it is possible for these experiences to go viral, reaching an audience of millions.
This matters to brand managers because it represents a loss of control over the brand image. To retain this control it is necessary to become more engaged, more transparent and most importantly, more agile.
The rise of social CRM
The proliferation of social media sites and rapid adoption rates around the world has led to widespread adoption by businesses for marketing purposes. The size of the audiences alone makes social media engagement inevitable; Facebook has over 750 million users and has quickly become an invaluable marketing tool.
Now companies have a plethora of ways to connect, from Facebook fan pages to Twitter feeds, Quora profiles and YouTube channels - all of which allow instant interaction and valuable dialogues with audiences. To meet this challenge CRM has fully incorporated itself within these platforms. Leading industry analysts expect the use of social CRM to grow rapidly in the coming years, with Gartner predicting that the market for social CRM software will be over $1 billion by 2012.
CRM has evolved from the traditional process of a one-to-one dialogue between a customer and a company. The relationship was previously maintained on the basis of KPIs and thresholds, implemented to ensure that certain quality criteria were met. Now CRM engages huge groups of people whilst still focusing on the needs of the individual.
Social media engagement has proved a double-edged sword for some organisations. When approached with the proper tools it can result in a higher quality of CRM; approached haphazardly there is the potential for mistakes to be broadcast across social media websites. Consequently a failure to appropriately deal with the needs of one individual could result in a ‘bad experience’ being broadcast across an entire social media audience.
A recent illustration of how damaging a poorly implemented social CRM strategy can be is the example of Australian fashion retailer GASP. Following a complaint from a customer, after being treated rudely by a shop assistant in a Melbourne outlet, GASP responded by defending the actions of the shop assistant in a flippant series of emails.
These emails subsequently made their way onto social media websites and went viral. The failure of GASP to act quickly and decisively to a single customer’s complaint meant that this experience was shared online amongst social media users. This resulted in a loss of control over GASP’s brand image and its eventual decision to close down their Facebook page following a torrent of negative comments.
Social CRM enables organisations to analyse audience interaction with social media, building a mutually beneficial community. This not only allows an organisation to quickly placate grievances, but if fully utilised, will transform customers into activists for a brand. This has been demonstrated by brands such as Bosch Professional Power Tools Europe, which has recently deployed technology to monitor various social media services, allowing a bespoke focus to its interaction with customers and the generation of new initiatives to improve customer loyalty and satisfaction.
Activating consumers with social media
A successful social CRM strategy requires an understanding of the audience engaged with rather than the audience hoping to be targeted. These strategies enable the targeting of specific individuals, or groups, with content matched to their interests and abilities. This proactive targeting is an integral part of what makes the customer experience special, building mutually beneficial relationships and brand loyalty.
A dedicated social CRM strategy allows a movement beyond quick opinion polls. Social media users can participate in surveys and interactive forums without ever leaving the site. Their attributes, actions and attitudes are constantly analysed and can be used to inform future interactions, product development and brand strategy. Rather than passively monitoring digital behaviour and projected sentiment, social CRM is a new way of both understanding and activating consumers.
Social CRM analysis facilitates multiple dialogues with various social media users, allowing particularly vocal users to influence potential customers. ‘Brand advisors’ are particularly accessible and with the increased customer knowledge that social CRM allows; the possibility to rapidly interact with fans to gain feedback on new products and marketing campaigns is furthered.
As companies track the influence of brand advocates comments and reactions through social CRM, pinpointing the impact and reception of these opinions facilitates an increase in the focus of the targeted social media. This in turn will create the most value from using social media in a CRM programme, for companies and its customers.
In compiling and measuring fan profile data, common brand indicators – likely to recommend, customer satisfaction and purchase intention – emerge and provide a dashboard for marketing and management teams. This social CRM data provides an input to feed algorithms that predict customer value scores and optimal brand actions, creating real business potential from social media.
Social CRM is becoming ever more important in organisations CRM strategy. With an increasing amount of money invested in social media, companies require more comprehensive and tangible evidence of the value social media campaigns create. These insights offer businesses an invaluable competitive edge, allowing them to build constructive dialogues with targeted individuals. Without insight, it can be very challenging to identify its intrinsic worth.
Oliver Trabert is CTO of enterprise feedback company QuestBack. Oliver joined Questback thorough the acquisition of Globalpark. He is responsible for software development and SaaS operations. Oliver has an impressive experience in the development of software applications and software consulting.