Social CRM is the connection between social media and a company’s internal and external communication systems. The question for companies is no longer whether to engage with social media, but rather how to engage with it.
Companies that have already started implementing Social CRM strategies rapidly see the impact on their internal processes. Social CRM aims to solve the fundamental dilemma of how to make human-scale marketing “scalable”.
The combined expertise of Atos Consulting and MSLGROUP sheds a new light on Social CRM strategy implementation and its impacts.
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1. Social CRMSocial CRM Towards enhanced Customer Relationship
Management
2. Social CRM 55
3. Table of contentsForeword 4Executive summary 5Introduction
6B Social CRM: a reality today, an imperative for tomorrow 81.1 A
fundamental trend 81.2 A necessity 101.3 A threat? 11C Social CRM:
an opportunity for companies 122.1 Companies must play an active
role in the debate, not just be a part of the ecosystem 122.2 The
virality principle affects every department within a company 13D
Revolutions sparked by Social CRM 183.1 Augmented customer
knowledge 18 3.1.1Information ownership policies 18 3.1.2 n endless
flow of information using it will be complex A but not impossible!
193.2 Social influence as a factor in listening to the customer
203.3 Social influence as a factor in augmented customer
segmentation 22 3.3.1Participation: a social influence criterion 22
3.3.2Social influence: a new segmentation criterion 23E Getting to
grips with Social CRM 284.1 Understanding the change in Customer
Relationship Management processes 284.2 In-depth modeling of the
organization of your company 294.3 Evaluating the effectiveness of
Social CRM 34 4.3.1Who still talks about ROI? 344.3.2Delivering the
right information to different audiences 354.3.3 eturn on objective
(ROO) and key performance indicators (KPI) R as tools to measure
Social ROI 36F Social CRM technologies are mature 405.1 The
challenge: intelligent integration of Social CRM and traditional
CRM 405.2 Overview of existing technologies 42G Essential elements
of a Social CRM strategy 446.1 The 5 fundamentals of Social CRM 44
6.1.1Reciprocity 44 6.1.2Reactivity 44 6.1.3Consistency 45
6.1.4Transparency 45 6.1.5Engagement in a true corporate approach
456.2 The truth about a few Social CRM myths 466.3 Some strategic
advice to get you started 47H Social CRM tomorrow 487.1 The
challenge of identifying customers 487.2 Your products are social
487.3 Your staff is social 49 Conclusion 50 About 51
Acknowledgements 52
4. Foreword Markets are conversations was the prophecy of the
Cluetrain manifesto1 at the end of the last century. In this
forward-looking book on marketing, published when the Internet was
in its infancy, the authors were already highlighting the
inexorable move towards a rebalancing of the power struggle between
a company and its customers.DIGITAL IDENTITY Ten years later Paul
Greenberg, regarded as one of the pioneers of CRM, defined the
emer-Stanislas Magniant, gence of Social CRM as the companys
response to customers seizing power and domina-Head of Digital,
EMEA ting the conversation. We have come full circle: consumers
have taken control. Brands areMSLGroup the subject of thousands of
simultaneous conversations and must fight to make themselves heard.
Twitter account In the extremely fluid and unstable world of social
media, Social CRM is not the latest marke- ting trend or simply an
elevation of traditional CRM, kitted out with a fashionable
adjective.@ msl_group It is the adaption of companies organization
and brands communication to a new Customer Relationship Management
landscape. E-reputation and community management still very Mail
new and evolving disciplines are generally perceived as
communication-related
[email protected] and activities.
Social CRM goes further: it has made its way into the heart of
current thinking in Commercial Management, Customer Services,
Communications, IT, etc. Sites :www.mslgroup.com Social CRM aims to
solve the fundamental dilemma of how to make human-scale marketing
scalable Social CRM is changing the scale and perspective of brand
involvement in social media. What was once a Communications
department issue is now becoming an organizational challenge for
any company that claims to be customer-centric. Social CRM is the
connec- tion between social media and a companys internal and
external communication systems. The question for companies is no
longer whether to engage with social media, but rather howDIGITAL
IDENTITY to engage with it. Companies that have already started
implementing Social CRM strategies rapidly see the impact on their
internal processes.Eric Lvy-Bencheton, Social CRM aims to solve the
fundamental dilemma of how to make human-scale marketingPartner,
Sale & Marketing / Customer scalable.Relationship Management
practice, The combined expertise of Atos Consulting and MSLGroup in
Communications and Manage-Atos Consulting ment Consultancy sheds a
new light on Social CRM strategy implementation and its impacts.
Compte Twitter Stanislas Magniant, Head of Digital, EMEA, MSLGroup
Eric Lvy Bencheton, Partner, Practice Sales & Marketing /
Customer Relation Management,@scrm_elb Atos Consulting Mail White
paper translated from the French Social CRM : vers la Relation
Client augmente,[email protected] published Nov. 2011.
Sites :www.fr.atosconsulting.com 1
http://cluetrain.com/book/95-theses.htmlhttp://www.pearltrees.com/t/social-crm/id3058044
2 Once a company designs how it will engage with customers, it
needs the organizational capabilities to deliver: adding staff,
building a social-media network infrastructure, retooling customer
care operations, or altering reporting structures (McKinsey
Quarterly
http://www.mckinseyquarterly.com/article_print.aspx?L2=16&L3=20&ar=2834)4
Social CRM
5. Executive summaryThe recent explosion in social media usage,
combined with the transformation of the consumer into
aconsumactivist, has permanently changed the relationship between a
company and its customers.These days, the customer experience is
often made public: consumactivists no longer hesitate to usesocial
media to voice their views. Their views have a major impact on the
purchasing decisions of otherswithin their social circle and
companies are unable to control them.This loss of control means
that companies must change in order to stay in touch with their
customers thequestion is not whether they should change, but
how.Following the example set by customers, companies have
positioned themselves on the social medialandscape. This is
creating a large number of access points for consumers, who do not
hesitate to makethemselves heard.There is a very small window to
adapt: we are facing a tidal wave that is moving much faster than
previousCustomer Relationship Management evolutions during the
1990s or the more recent emergence of the Web.You only have two to
three years to act.We are facing a huge new phenomenon, but also
new opportunities: when the social media virality principleis
utilized to its full extent, what you lose in terms of control, you
gain in terms of quality and frequency of therelationship.Who has
not dreamt of obtaining better information, improving customer
segmentation according topersonal influence, and working on the
effectiveness of Communications strategies?Who has not dreamt of
continuously securing business opportunities, and more qualified
ones? Who hasnot dreamt of improving their customer service
handling by capitalizing on new social channels?In order to survive
the rapid upheavals created by social media and to capitalize on
these opportunities,companies must ask themselves serious questions
and update their technology accordingly to ensure theyare ready for
this new revolution - Social CRM. Social CRM 5
6. INTRODUCTION More and more companies are taking a stand on
Social CRM. There is a proliferation of press articles and blog
postings on the subject1. But it is still difficult to find a
definition of Social CRM that everybody can agree on. This is no
doubt the nature of great changes: we experiment before we
theorize. The document you are now reading is intended to be
practical rather than academic. To delineate the subject more
clearly, we offer a frequently-used definition of Social CRM to
make it easier to understand the initiatives in this area and how
to get the most of it. It is Paul Greenbergs2 definition, a
recognized authority, speaker and experienced practitioner in the
field of CRM3: Social CRM is a philosophy and a business strategy
supported by a technology platform, business rules, workflow,
processes and social characteristics, designed to engage the
customer in a collaborative conversation in order to pro- vide
mutually beneficial value in a trusted and transparent business
environment. Its the companys response to the customers ownership
of the conversation.4 No trace of the words Web, social network,
blog or 2.0 in this definition. But Social CRM is unequivocally
linked to the explosion in content production by Internet users and
to the relationships established between them via social media. It
has merely detonated an inevitable phenomenon: markets have become
conversations and, in the future, conducting a relationship with
customers will mean entering this realm in order to engage in a
dialogue with them. Beyond the communication dimension, Social CRM
revitalizes the entire relationship between companies and their
customers. This is based on a deep-seated change in brand attitude
(highlighting transparency, sincerity and even a certain form of
modesty) and on new types of relationship that place particular
emphasis on this idea of a conversation. A company that wants its
engagement with Social CRM to succeed must first ask itself some
searching questions about processes, organization, technology, and
financial and human resources. This is the philosophy and strategy
element of Paul Greenbergs definition. There is no room for
improvisation: just as there are firmly established methods and
processes for managing telephone calls or incoming e-mails, there
must be methods and processes for Social CRM. Augmented Customer
Relationship Management does not mean having a Facebook page or
Twitter account purely for one-way communication, or to imitate
competitors. This document uses analyses of flagship initiatives to
highlight the innovative nature of Social CRM by demonstrating how
it can transform or complement other CRM channels. First we will
see that Social CRM is already a reality, done by some companies on
a daily basis. We will explore the reasons that motivate companies
to enter into these new conversations with their customers. This
will enable us, as a second step, to understand what Social CRM is
changing in terms of the practice of Customer Relationship Manage-
ment. Finally, we will discuss the various best practices that are
beginning to emerge in this field and the traps to avoid. In the
course of our analysis, we will strengthen this overview of Social
CRM by including the views of SCRM experts and practitioners,
companies, tool editors, consultants, academics, etc. Together they
will provide, if not the keys to the door, then at least the tools
for reflection so that your organization too can successfully
engage in fruitful conversations with customers. The term Social
CRM has been identified as a trend in searches carried out on
Google since April 2010: 1
http://www.google.com/trends?q=%22social+crm%22&ctab=0&geo=all&date=all&sort=0
2 http://the56group.typepad.com/about.html 3 Author of CRM at the
speed of light, Social CRM 2.0 Strategies, Tools, and Techniques
for Engaging Your Customers, McGraw-Hill, 2009 (4th edition). 4 CRM
is a philosophy & a business strategy, supported by a
technology platform, business rules, workflow, processes &
social characteristics, designed to engage the customer in a
collaborative conversation in order to provide mutually beneficial
value in a trusted & transparent business environment. Its the
companys response to the customers ownership of the conversation.
http://the56group.typepad.com/pgreenblog/2009/07/time-to-put-a-stake-in-the-ground-on-social-crm.html
http://www.cluetrain.com/book/index.html 6 Social CRM
7. What is the difference between social mediaand social
networks?Before discussing Social CRM in more details, it is
important to point out the difference betweensocial media and
social networks.Social media are tools which facilitate
interactions, collaboration and sharing of contentbetween Internet
users. Social networks focus in particular on relationships between
an indivi-dual and his or her contacts.They are a sub-component of
the large toolkit represented by social media. THE MAIN TYPES OF
SOCIAL MEDIA SOCIAL MEDIA Social Multimedia Blogs Forums sharing
Collaborationnetworks tools platformsFacebook, Youtube, Quora,
Wordpress, Twitter, PhpBB, Dailymotion, Yahoo Answers, Tumblr,
Google+, Bbgraph, Vimeo, Wiki-Answers, Blogger, ...Linkedln,
LastFM, Wikipedia, Posterous, Viadeo, ... Flickr, Delicious, ...
... ... Social CRM 7
8. 1 Social CRM a reality today, an imperative for tomorrow
1.1/ A fundamental trend there are plenty indicators that quantify
a companys use media presence and most use social media for
Customer of social crm. According to a survey conducted by IBM
Relationship Management purposes. in October 2010*, nearly 80 % of
companies have a social WHAT IS YOUR COMPANY DOING WITH SOCIAL
MEDIA TODAY ?** Communicate with customers 74% Respond to customer
questions 65% Promote events 60% Generate sales leads 52% Sell
products / services 50% Solicit customer reviews 48% Capture
customer data 46% Brand monitoring 46% Customer research 43%
Recruit employees 43% Employee-to-employee interactions 41% Solicit
customer ideas 40% Provide support 40% Expert insights/thought
leadership 38% Training/education 37% Customer-to-customer
interactions 35% Vendor or partner communications 27% Social media
usage by companies* Survey questioned 351 executives from 8 large
industrialized This survey of 351 business leaders from the major
deve- would be perceived as disconnected if it did not engage and
emerging countries (USA, UK, France, loped and emerging countries
also gives some idea of with social media, while half of
respondents said Germany, India, China, how working with social
media is perceived. Nearly 70% that their organization reaches
customers better Brazil, Australia). of the executives who took
part said that their company thanks to social media.** ote : N
n-351. Not shown in figure. I dont know - 9 percent and Others - 2
percent. Source : IBM Institute for Business Value analysis. CRM
Study 2011 8 Social CRM
9. Percentage of companies with a profile on a social site* 79%
Social networking sites 79% 18% 3% Media sharing sites 55% 37% 8%
Microblogging sites 52% 41% 7% Wikis 48% 45% 7% Blogging sites 45%
45% 10% Social review sites 36% 52% 12% Social bookmarking sites
31% 55% 14% Have a profile/presence Do not have a profile/presence
Dont know Penetration of social media usage in companies
Nevertheless, social media presence and activity do not CRM. So
there is real scope for improvement The mean true integration with
the overall companys CRM SugarCRM1 study conducted in January 2011
goes even process. Many studies demonstrate this, including the
further, pointing out that only 26% of companies integrate study by
the Brand Science Institute (European study, information retrieved
from social media with their existing 2010) which reveals that only
7% of companies have CRM data. They are aware of this gap as 72%
said that really understood the value of social media for they plan
to do this within the next year.1
http://www.sugarcrm.com/crm/about/press-releases/20110118surveyscrm.html
The professional view: accelerating CRM trends The first CRM
evolution centered on the widespread use of call centers and sales
force automation (SFA) lasted 10 years. The second evolution, based
on the Internet and more globally, on multichannel marketing, took
5 years. We believe that the current Social CRM revolution will
take a maximum of 2 to 3 years to become a practice used by the
majority of companies. Eric Lvy-Bencheton Partner, Practice Sales
& Marketing / Customer Relationship Management, Atos Consulting
* Note : Numbers rounded to equal 100 percent. Source : IBM
Institute for Business Value analysis. CRM Study 2011 Social CRM
9
10. 1 1.2/ A necessity It is easy to explain a companys keen
interest in social processes without delay, simply because they
need to be media, whether this is expressed through true
integration where their customers are. This universal catchment
area is with CRM or, as is most commonly the case to date, by
increasingly located in social media. The figures below are a
desire to achieve this. Whether they like it or not, it is highly
persuasive: in the interest of all companies to engage in Social
CRM Facebook has 750 million active members worldwide 80% of French
Internet users use at least one social network (uniform
distribution across socio-professional categories and age profiles)
80% of consumers want a dialogue with brands on the Internet 78% of
Internet users trust recommendations posted on social media by
their peers (compared with just 14% for advertisements) 74% of
Internet users have a more positive image of brands that engage in
conversations on social media Sources :
https://www.facebook.com/press/info.php?statistics and The Comscore
2010 Europe Digital Year and Mdiamtrie Social media, a mass
phenomenon for customers Companies are faced with the challenge of
adapting and It is not only social networks that influence
purchasing evolving to meet the needs and demands of these new
decisions: for example, 21% of Internet users decide to social
customers. buy a product after reading a blog.* If we know that 33%
of French people consult blogs at least once a month**, we can
measure the commercial impact of this social medium. The expert
view: dont forget good old discussion forums Forums are not dead in
fact, they are much more effective. Conversations in social
networks are light, but are much longer and go into far more depth
in forums. There, you ask questions and get answers. This doesnt
happen in social media, where people express themselves without
necessarily expecting a reaction. Frdric Cavazza, Fredcavazza.net
*Source : emarketer 2009 * *Source : Mdiamtrie 2009 10 Social
CRM
11. 1.3/ A threat? When companies start to take an interest in
Social CRM The most important thing is to listen actively and to
res- they often wonder how they can use social media to open pond:
companies must abandon the fantasy of controlling up a new channel
of communication and exchange about conversations about their
brand. Nowadays, consumers their brand. They do not realize that
customers have not themselves decide which platforms they want to
use to waited for them: they have already started the conversa-
voice their comments. These platforms come in various tion on the
new open forum - social media. If companies forms, as the diagram
below shows. and brands do not answer, there is a danger that they
will simply be excluded from discussions that affect them more than
anything else. OVERVIEW OF SOCIAL MEDIA Overview of social media by
field of use, 2011 (by Frdric Cavazza) Several striking facts
emerge from this breakdown of social At one time, people would
first approach a companys custo- media into 7 families: mer
services department if they had a problem or question. Today, this
behavior has changed. When customers expe- F acebook and Google are
present on all the usage fields rience a product for the first time
or make their first purchase, listed and dominate the social media
ecosystem their instinct is increasingly to approach community
platforms P latforms which are extremely popular one day may
quickly on the Internet to share that experience and ask for help
or disappoint if they do not meet the expectations of the social
advice. Customers are gradually becoming accustomed customer, while
new players are constantly appearing* to using Facebook or Twitter
to get support or register a T he social medium itself is not
important the important complaint. Not taking this into account
could be fatal for thing is the usage potential (i.e. the
opportunities) it offers. companies1. Companies can no longer
channel discussion and must implement tools and processes that
enable them to be in direct contact with consumers so they can
react accordin- gly. The rules of the game have changed: where
Customer Relationship Management is concerned, companies offer
their products, customers call the shots. * For example, Rupert
Murdoch bought MySpace for nearly 600 million dollars in 2005 but
it was sold for barely 35 million in June 2011. Facebook tops the
social networks these Want Customer Service? Complain on Twitter :
days, but will Google +1
http://www.smartmoney.com/spend/family-money/want-customer-service-post-your-complaint-on-twitter/
change the landscape? Social CRM 11
12. 2 Social CRM: an opportunity for companies 2.1/ ompanies
must play an active role in the debate, C not just be a part of the
ecosystem Social CRM is a response to the behavior of consumac- The
challenge for companies is to reconstruct relationships tivists. It
puts the customer back at the heart of corporate within the
ecosystem created by consumers, and to strategy, using social media
as the vector to this new become a proactive player in the
conversational network approach. It goes much further than Social
Marketing. It of social media. no longer encourages loyalty purely
through transactions or marketing, but also through relationships
and conversa- tions. This new approach rests on four pillars:
engagement, conversation, participation and content distribution.
CHANGES IN CUSTOMER/COMPANY RELATIONSHIPS From transactional...
uality of Customer Relationship Q Personalized Management often
measured as marketing the operational quality of the transaction
ntermittent contact with customers I Company Mass Brand ... to
relational and conversational Marketing uality of Customer
Relationship Management Q measured throughout the life cycle
ontinuous contact C ncrease in the number of relationships I
maintained by the brand Push Collaborative & interactive 12
Social CRM
13. 2.2/ he virality principle affects T every department
within a companyThe intrinsic characteristics of social media, such
as 7 4% of Internet users say they are influenced by
theparticipation, freedom of expression and accessibility, opinion
of a peer in a forum or on-line discussion, moremean that customers
are free to voice their opinions inde- than by a straightforward
promotion in the form of top-pendently of the sales pitch. down
communication 3 8% of consumers say they have changed their mindThe
figures* below illustrate the power of the link between after
reading a negative opinion on social mediacustomers created by this
new channel: Customers no longer hesitate to use social media
before 78% of Internet users say that they trust recommenda- any
other channel in order to obtain information, express tions from
consumers that are published on social media and disseminate their
opinions, both positive and nega- (compared with 14% for
conventional advertisements) tive, to the entire community.
Satisfied customers tell three friends, angry customers tell 3,000
Pete Blackshaw, author of the book of the same name**We should not
believe that controversy originates in social improvement, this
viral propagation principle is just onemedia: they are more likely
to be the sounding board. of several fantastic opportunities that
can be exploitedThe most damaging, sensitive or simply amusing
pieces through Social CRM.of information will experience the most
consistent virality.This revolution in conventional customer
interaction chan- Effective handling of customer
dissatisfactionnels must be seen as a real opportunity to reinforce
thecustomer/company relationship. The information made A
dissatisfied customer who is not dealt with by a com-available
through these new channels is far richer and pany will stimulate
churn within the community.more immediate, due, without doubt, to
the inherent vira-lity effect of social media. It represents an
enormous pool By contrast, a dissatisfied customer who is helped
byof opportunities for all functions within a company. the company
as part of an effective conversational rela- tionship will produce
the opposite effect by talking aboutWhatever the business process,
from effective handling his or her experience. This may therefore
prompt someof customer dissatisfaction to increasing customer
loyalty, dissatisfied customers to return as satisfied or even
loyalcontent distribution or sales strategies effectiveness
customers. CORRELATION BETWEEN CUSTOMER SATISFACTION AND CHURN
RATESatisfaction index *Sources: Nielsen Trust and Social customer
Advertising Global Traditional customer Report and Mdiamtrie Fevad
* *Satisfied Customers Tell Three Friends, Churn rate (%) Angry
Customers Tell 3,000, Crown Business, 2008 Social CRM 13
14. 2 14 *Source : for Rightnow Harris Interactive Social CRM 1
0% 80% 10% 70% 20% 30% 50% 40% 60% mise of tangible benefits.
Enriching your loyalty programs 1 sep 13 sep 07 aot Il y a 4 heures
Il y a 19 heures drnorth dnorth curns Jon Curnow bethleg Elizabeth
Telg cornpankakes Mallory LeNoir sarahperkins618 Sarah Perkins
these approaches by increasing transactional value through tomer
and the brand. The key to Social CRM is to combine loyalty points
and special promotions, and engagement traditional loyalty programs
based on discount vouchers, In addition to dealing with
dissatisfaction, listening to If we focus on customer loyalty, we
find two approaches: irritated or disappointed customers but also
any positive social media means companies do not just pick up on
with customers and increase their engagement with the pro-
conversations. This will help building long-term relationships
programs focused on building a history between the cus- of creating
a win-win discussion between the two par- services. In other words,
Social CRM is the ideal way comments that would normally never
reach customer Monday. Nice service, thanks! now. Thanks for the
kind attention. to a free drink! #worthit #greatcustomerservice
#thanks! will not hesitate to tweet about it. Got my camera back,
and its as good as new!! #thanks SONY :) Waited 20 mins in the
@starbucks drive thru and they treated me Great customer service
experience with @BofA_Help! Thanks guys :) The Retail Consumer
Report 2011 - RightNow I never publicly thanked @KLM for the speedy
response to my tweets on to their friends