Gartner: Social media is the new CRM (circa 2001)
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More than 70% of all IT-led social media initiatives will fail over the next two years compared with about half of business-led ones, according to researchers Gartner.

This high failure rate is because organisations do not currently have the right skill sets in place to design and deliver such offerings, while the situation is also not helped by a dearth of suitable methodologies, technologies and tools to help them.

Therefore, said Mark Gilbert, a research vice president at the firm, it was crucial for both IT departments and business colleagues to work together in a "concerted and collaborative" fashion if they wanted to deliver successful projects.

The situation was likely to improve after 2012, however, leading to an increase in the overall impact of social media on both business and society and to growth in the social software market.

But the resultant higher availability of social networking services both inside and outside the company firewall, coupled with changing demographics and work styles, will have implications.

For example, by 2014, about a fifth of business users are predicted to use social networking services rather than email as their primary vehicle for interpersonal communications, particularly for activities such as status updates and locating experts.

Steep growth rates

Matt Cain, another research vice president, said: "The rigid distinction between email and social networks will erode. Email will take on many social attributes such as contact brokering, while social networks will develop richer email capabilities."

This scenario was likely to lead to "steep growth rates" in the procurement of both on-premise and cloud-based social networking services as most companies attempted to either create their own internal social networks or allow staff to use personal social network accounts.

As a result, Cain recommended that organisations develop a long-term strategy for providing collaboration and social software-based services and create policies for governing the use of consumer offerings by in-house staff.

He does not expect to see the widespread adoption of social network analysis tools that enable organisations to analyse the online behaviour of staff, business partners and customers, however.

Only 25% of enterprises are likely to routinely use such tools to try and improve performance and productivity by 2015 due to staff reluctance to respond accurately to surveys and resentment at being spied on by software.

If organisations do wish to go down this route, however, Gartner advises them to ensure they gain staff trust and buy-in in advance. They must also address privacy and confidentiality issues and clarify how any information would be used and communicated.

About Neil Davey


Neil Davey is the managing editor of MyCustomer. An experienced business journalist and editor, Neil has worked on a variety of newspapers, magazines and websites over the past 15 years, including Internet Works, CXO magazine and Business Management. He joined Sift Media in 2007.


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04th Feb 2010 10:36

Let's be clear.  This isn't a failure on the part of social media, as the Social Web is here to stay -- an internet of connected people will never return to one of merely connected computers.

The reason for failure is companies rushing into embracing the Social Web before they have the requisite skills and knowledge to formulate a strategy and then select the right tools to deliver it.

Expertise will build over time, but companies could get there faster by using professionals who've been submersed in the Social Web in a business context for some time rather than believe they can pick it all up themselves.

Ian Hendry

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05th Feb 2010 09:11

Social networks are certainly increasingly important for consumer marketing. However, as soon as possible, prospects and customers should be lead away from public networks to the companies own interactive web site. It seems that most participants in public networks are diligent at entering their own remarks, but have a strong tendency not to read other persons input. Try sending a message to a person in twitter who is following several hundred other twitters - your message will disappear into the cloud.

More comments to be found on my blog

David Duncan

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By Anonymous
08th Feb 2010 11:37

Although I think Social CRM is an important growth area, many businesses are going to struggle in figuring out exactly how they want to use such a system, and therefore the model for how it should look and operate will still need to be defined. Fortunately, many SI vendors are embracing this and are willing to work with customers in discovering what's best for them.  It would be easy to view the entirety of Social CRM as 'Twitter behind the firewall'. Many organization are looking beyond internally focussed systems and are looking for more effective ways to engage with customers.  This will mean new definitions in how employees engage with such a system. For example, it has become a common practice that all employees read their email every day. In fact, I don't remember any role I've had where that was an objective, measurable or not. Until Social Media's acceptance in the workplace reaches the same level of normalcy, businesses will have to be very engaging with staff to make sure that everyone has bought into whatever goals are established. 

-- Chris Muller Sr. Manager CSP - SFDC Cognizant Technology Solutions

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23rd Apr 2010 00:19

Great article. No doubt social networking is redefining CRM. For further reading, Intelestream has recently published a whitepaper about the subject. The whitepaper defines the concept of Social CRM, offers strategies that can help organizations better leverage social networking as part of their overall customer management strategy, and outlines steps that businesses can take to develop a tangible integration between social networking and traditional Customer Relationship Management. The paper can be read at 


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