Social CRM: Is this how to avoid making the same old CRM mistakes?
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Gartner's Scott Nelson has outlined how firms can adopt a more strategic approach to social CRM.

With growing concern over impetuous investment in social CRM spending (as outlined by Gartner’s Jim Davies in an earlier article on, the analyst firm’s Scott Nelson took to the stage at this week’s CRM Summit to demonstrate how firms should be approaching their social projects.

Gartner estimates that at present businesses are taking four different approaches to social CRM.
  • 20% of organisations are in denial, believing it is a fad. “There is real value to it and by denying it you are simply going to lost out on the opportunity,” said Nelson.
  • 50% or organisations are ‘toe dippers’ who are cautious but curious. “They maybe have a presence on Facebook and will sit back and see what happens.”
  • 5% are adopting a strategic approach to social CRM. “They are saying this is something that has now been added to our arsenal of ways to interact with customers, whether we’re in a B2C space of B2B or a governmental entity or a profit entity, it is a vehicle, a channel, that we can add to our repertoire and use it in ways that enhance the strengths of it. We have a strategic approach, we’re not going to overspend but we’re going to intelligently use it.”
  • 25% are jumping in too aggressively. “They feel that something big is happening so they are just running out and trying everything and seeing what sticks. That is not a good approach, you are going to waste a lot of money.”
“The key is becoming strategic about it,” emphasised Nelson. “Really thinking about what this can do for you and what it can’t do and how it fits into your business model.”
The eight building blocks of CRM has emerged as a valuable model for organisations who have deployed traditional CRM, and in work on the reasons for CRM failure, Nelson suggested that in many cases at least one of the building blocks had been missing. For those unfamiliar with the concept, the outline of the eight building blocks for CRM is:
  • Vision – “What is it that you’re trying to accomplish when you are trying to change from being a product-centric organisation to being a customer-centric organisation? What does that transition entail?”
  • Strategy – “How are you going to make that start happen, how are you going to turn your customer base into a strategic asset?”
  • Valued customer experience – “What is it that the customer expects from you?”
  • Organisational collaboration – “How are you going to break down the organisational silos in your organisation to facilitate the customer experience?”
  • CRM processes – “How does the customer move through your organisation?”
  • CRM information – “The data that this is all based on.”
  • CRM technology – “The one block that we always find in CRM.”
  • CRM metrics – “How are you going to go about tracking whether or not you have been successful?”
That is applicable no matter what you do in CRM. When you apply it to social CRM you get a variant on it that is specific to this area.
  • Social CRM vision - Build a market position via the use of social media, and relating it to the broader CRM vision. “What is your vision as an organisation as to how you are going to build your market position via the use of social media? What will it allow you to do that you can’t do today?”
  • Social CRM strategy - Build a market position via the use of social media, and relating it to the broader CRM vision. “Strategically using this channel, like your other channels, what are its unique strengths and weaknesses? There are some things you would not use direct mail for, there are some things you would not use social media for.”
  • Social valued customer experience - Understand what the customer wants to use social media to do, and not forcing customers into channels they do not want to use. “Understanding for different segments of your customer base where social media makes sense and where it doesn’t.”
  • Social organisational collaboration - Allow for multichannel sales, marketing and customer service, and not letting silos interfere with the customer process. “If I go onto a social media site and I’m talking ot you about a problem but I have to leave and later I call the call centre will the call centre have any idea about what I posted on Facebook and what we’re talking about?”
  • Social CRM processes - Understand the broader cycles, such as prospect to cash, and realise how social media will aid in the cycle. “In some cases the entire transaction can be done by social media, in some cases it is only a piece of the puzzle to help move them along.”
  • Social CRM information - Ensure that the right data is collected and the right information goes to the right place.
  • Social CRM technology - Involve data and information management,customer-facing applications, and supporting IT infrastructure and architecture. “In some cases it is simply taking advantage of the infrastructure that another company has put in place but in other cases you are going to need your own systems to get this done.”
  • Social CRM metrics - Involve internal and external measures of CRM success and failure.
But another valuable piece to think about is governance for the whole thing. If you want to take advantage of social media and want to make a conscious company-wide effort to use it to facilitate communication with customers, you have to realise that you have x number of employees from your organisation with access to Twitter.
“How do you handle thousands of employees all responding to customers directly on Facebook and Twitter? That is a governance issue,” said Nelson. “Who has responsibility for speaking on behalf of the company and how do you handle that and what do you do when somebody you didn’t want to respond from your company actually responds?”
A broader strategy
And Nelson also had two other recommendations for organisations, over above the eight building blocks.
“Most firms aren’t going to get to a point over night that they suddenly have this brand new social media strategy. They are going to tend to attack pain points in much the same way that they have every other aspect of CRM. They are going to use social media to do a better job of helping their sales force. Or they might use social media to do a better job on customer service. They start out with more of a limited view like that. For sales they might use social networking to do a better job of creating sales contacts. For marketing, it might be used for better brand awareness of better monitoring, or even crowdsourcing to help product development.”
Any of these are solid areas to start in, and to learn what you are doing, said Nelson. You don’t have to start out in the middle, you can start with one or two of these adn work your way to the others.
“One of the mistakes we see is that a lot of firms believe they have to have this fully-baked completely sound social media strategy in all aspect of their business from day one. There is nothing wrong with starting in an area and developing that is you get more proficient.”
And Nelson also warned that organisations should realise that social media is not one-size-fits-all and organisations should not get their social strategies tied up into specific social media platforms. The result of this is that by focusing on just one site, organisations can miss what may be a better fit for the company. The key, Nelson said, was to take a broader strategy that allows businesses to reflect the ‘real world’ networks of customers.
“By my count, there are at least 229 significant social media sites out there right now. Not just Facebook and Twitter. They are just top of mind in awareness. And in some geographies they are not even the important ones. Different markets have different sites. And if you look at the 229 social media sites they actually do very different things. They stratify layers, and there are 28 different layers of social media. Some specialise in crowdsourcing. Others specialise in locational services. Some are photographic and media-based. Others are more professional networking. So one of the things that becomes important is not to get your whole strategy tied up into particular social media sites.
“If you focus on the particular website you miss the opportunity to see what is coming next. You miss the opportunity to take opportunity of some of the other sites that may be better fitted to you business model. So one of the keys to the building blocks of social media is realising that the key is your overall strategy of how you are going to use this. Tactically you will then pursue particular sites. You will have tactics of what you are going to do with Facebook and twitter but you will have tactics for other sites as well. And if you have a good strategy in place, as today’s social media sites come and go, and new ones come up to take their place, your strategy will facilitate the rotating into those new sites.”

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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