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Social CRM The New Frontier


									Social CRM: The New Frontier
of Marketing, Sales and Service
Social CRM: The New
Frontier of Marketing,
Sales and Service
The emergence and increasing     adopt a “social CRM” strategy.      that social media and Web 2.0
usage of social media and        Such a strategy will help           will not work for all customer
other Web 2.0 tools has          them touch customers at             needs and segments, even
dramatically altered the         many more points and much           though they can significantly
ways in which companies          earlier in the buying process,      alter the role played by more
interact with their customers.   often at lower cost than that       traditional contact channels.
For instance, buying advice,     of more traditional marketing,
                                                                     In short, social CRM presents
product information and          sales and customer service
                                                                     many opportunities to build a
technical help is increasingly   channels. To do so, companies
                                                                     distinctive capability that can
being disseminated from          should embrace the social
                                                                     serve as a building block of
consumers to other               media channels being used
                                                                     high performance: a method
consumers, in some cases         by their customers, identify
                                                                     to potentially connect more
without involvement or           and engage with the “super-
                                                                     tightly with customers at
oversight by the provider.       users” who supply product
                                                                     lower cost and in a way that
Clearly, this shift presents     expertise to other customers,
                                                                     provides a real differentiation
both opportunities and risks     and harness the power of
                                                                     from competitors.
to companies.                    advanced analytics to provide
                                 broad insights on customer
To derive greater value from
                                 needs, wants and behaviors.
these new communication
                                 Perhaps most importantly,
channels, companies should
                                 companies must remember

                                                                  The New Frontier of Marketing Sales and Service | 3
Figure 1. As social media has grown in importance, original equipment
manufacturers’ control of the buying and service process has declined.

   Control OEM has over
   buying/service process

                                                        Growth in social media

    No Web                               Early stages                  Social networking
                                         of Web                        and cloud explodes

The evolution of                                call the manufacturer’s call center for
                                                support. The introduction of the Internet
                                                                                            report from The Conference Board
                                                                                            found 77 percent of adult Internet
the Internet and                                gave consumers more options. They
                                                could access further information on
                                                                                            users considered blogs a good way to
                                                                                            get information about a company or
social media                                    products—as well as limited support
                                                information—via the retailer’s or

The evolution of social media and other         manufacturer’s websites. For most           The preceding data reflects a
Web 2.0 tools is having a significant           products, though, consumers still had to    fundamental shift from a predominantly
impact on both how consumers interact           go to a physical store to purchase items    “company to consumer” dialogue to
with companies and the level of                 and call the manufacturer for support.      a “consumer to consumer” dialogue.
control such companies have over the                                                        Indeed, a recent survey from Forrester
sales, marketing and service of their           Today, consumers make their purchases       Research found nearly half of online
products. (Although it is difficult to find     either via retailers’ or manufacturers’     users say information provided by
consensus on what exactly is meant by           sites or retailers’ physical stores.        other consumers is more important
“social media,” for the purpose of our          However, as social networking and           to them than data given by marketers
discussion, the term refers to Internet         other Web 2.0 tools have exploded in        of products and services.4 In this new
and mobile channels that enable users           popularity—a recent study found the         world, companies have an opportunity
both to view and create content and to          number of social networking users           or a threat, depending on how they
share that content with others.)                has doubled since 20071—consumers           adapt marketing, sales and service
                                                have many new sources of product
Consider the example of original                information and buying advice, as well      1 “Number of Social Networking Users Has
equipment manufacturers (see Figure             as answers to usage and technical           Doubled Since 2007,” Adam Ostrow, July 28,
1). In the pre-Internet days, consumers         questions about the products they           networking-users-us/
interested in purchasing a product              have purchased. According to a recent       2 “Engaging Consumers Online,” DEI Worldwide,
either asked their friends or a retailer        study by DEI Worldwide, 70 percent          2008
for advice. They had to go to the               of consumers have used social media         3 Executive Action Series, No. 251, Sheri Rothman,
                                                                                            The Conference Board, November, 2007
retailer’s store to buy the item and            to get information on a product,            4 “Justifying Social Marketing Spending,” Forrester
                                                brand or company.2 Furthermore, a           Research, February 2009
4 | Social CRM
"According to a recent study by
 DEI Worldwide, 70 percent of
 consumers have used social media
 to get information on a product, brand
 or company. Furthermore, a report from
 The Conference Board found 77 percent
 of adult Internet users considered blogs
 a good way to get information about a
 company or product."
Figure 2. Consumers’ changing preferences and behaviors have made
online life more complicated for providers of all kinds.

Old World

  Banner                    Website                       Search

  Phone                   Call Center

 Lead Gen                     Rep                         Phone

New World

                            Video                                                       IP TV


entertain                 inform             convert
          connect                    assist

            Print                                                Center

                 Banner                                Search                                   Community

                                                                             Lead Gen


6 | Social CRM
Figure 3. Social CRM changes marketing from a push-through funnel to a real-time dialogue at all
stages of influence.

Forced Message Push                                                "Unlimited" opportunities for dialogue

Awareness                                                          Awareness

Consider                                                           Consider

Purchase                                                           Purchase

Usage                                                              Usage

Loyalty                                                            Loyalty

                                                                               Spectrum of opportunity for interaction to
                                                                               influence choice
                                                                      Seized opportunity to             Untapped opportunity to
                                                                      influence choice through          influence choice through
                                                                      dialogue/interaction              dialogue/interaction

of their own products to a new               In addition, because of the speed with           engage in a dialogue with prospects or
consumer ecosystem: one in which             which customers and information                  customers much earlier and at many
enthusiasts and detractors can dictate       move today, companies must be able               more touch points.
customer perception and experience for       to incrementally, and very quickly,
manufacturers.                               improve their operations based on what           The collapse of the marketing funnel,
                                             they learn from observing customers.             in turn, means the distinctions
                                                                                              between marketing and sales become
Ramifications for                            As a result, many companies have
                                             shifted the focus of their investments           further blurred and, in some cases,

providers                                    from building channel infrastructure
                                             to creating nimble and robust content
                                                                                              disappear entirely. In fact, social media
                                                                                              increasingly is being referred to not
                                             management and data collection and               in terms of marketing or sales, but
What are the ramifications of this
                                             analysis capabilities.                           rather, as an “engagement channel,”
shift? At a high level, the evolution
                                                                                              which incorporates elements of both
of social media has introduced new
                                             From a marketing perspective, the                marketing and sales.
contact channels that must be
                                             evolution of social networks and online
integrated into marketing, service and                                                        With consumers increasingly relying on
                                             communities has resulted in a collapse
support strategies. However, while                                                            third-party sites for usage and technical
                                             of the marketing funnel (see Figure 3).
social networking and social media                                                            information, manufacturers must build
                                             How so? Traditional, mainstream
are certainly on the rise, there are still                                                    capabilities to strengthen their brands
                                             marketing forces a message through
large groups of customers who do not                                                          and customer loyalty via these channels,
                                             the marketing funnel, moving through
communicate via these tools. Therefore,                                                       as well as to up-sell and cross-sell
                                             stages from building awareness
differentiated service takes on an even                                                       relevant, related products and services,
                                             to earning loyalty. It only allows
greater role because of these new                                                             and gather and integrate cross-channel
                                             dialogue and relationship building as
channels. A thorough understanding                                                            customer data. Indeed, smart use of
                                             the prospect or customer progresses
of customers’ channel preferences,                                                            these third-party channels can become
                                             through the funnel. By contrast, the
combined with insights into the true                                                          a powerful way to boost image and
                                             digital revolution, and particularly
value of customers to the business,                                                           customer satisfaction while reducing
                                             social media, makes it possible to
must drive how companies interact with                                                        CRM operational costs.
each respective segment (see Figure 2).
                                                                                          The New Frontier of Marketing Sales and Service | 7
A way forward:                              with different customer experiences
                                            to discover those that resonate with
                                                                                             and prospects. While such feedback
                                                                                             certainly can provide valuable
social CRM                                  customers. One example is Intuit, which
                                            has successfully embraced and enabled
                                                                                             intelligence on what customers are
                                                                                             thinking, too much focus on one source
What should companies do to                 a passionate online community of                 or one segment can lead to a narrow
respond to these changes? They              QuickBooks users that since has become           or biased perspective. Thus, companies
should start by developing a “social        the place to go for customers seeking            must integrate the data they gain
CRM” strategy, which Accenture              advice and service. Extending this               from online channels with other, more
defines as an operating model,              commitment to the customer further,              holistic quantitative and qualitative
supported by technology and business        Intuit recently purchased,              data gleaned from other sources to
processes, that is designed to engage       a provider of free online tools that help        paint a more accurate picture of their
customers in a mutually beneficial          consumers manage their finances. "With           overall customer base.
two-way conversation. Social CRM            this transaction, Intuit will gain another
                                            fast-growing consumer brand and a                As they develop their social CRM
is a company’s necessary response
                                            highly successful Software as a Service          strategies, companies should consider a
to its customers’ transformation
                                            (SaaS) offering that helps people save           number of actions they can take within
from spectators (“TV watcher,"
                                            and make money," said Brad Smith,                marketing, sales and service to build
"newspaper reader," "Web browser”) to
                                            Intuit CEO. "This move will enhance              and strengthen customer relationships.
participants ("product rater," "blogger,"
"ambassador") and their subsequent          Intuit's position as a leading provider
co-ownership of the company’s brand.        of consumer SaaS offerings that
                                            connect customers across desktop,
A key element of a social CRM               online and mobile."5
operating model is a very flexible
framework that allows a company to          However, companies also must                    5 “Intuit to Acquire,” Intuit press
                                            be careful to balance the online                release, September 14, 2009,
observe what customers are doing                                                            com/about_intuit/press_room/press_release/
and saying, and then experiment             feedback they gain from customers               articles/2009/IntuitToAcquireMint.html

                                                                                         The New Frontier of Marketing Sales and Service | 9
"The end of the marketing funnel may
 lead to significantly more, earlier, deeper
 and richer opportunities to build a
 dialogue with prospects and customers,
 and can offer an enhanced opportunity to
 build relationships and influence choice."

10 | Social CRM
Implications of                              The National Football League also
                                             recently substantially upgraded and
                                                                                               marketing products and services. We
                                                                                               will see fragmentation in engagement
social CRM for                               expanded its social media presence.
                                             For the 2009 college player draft, the
                                                                                               platforms (for instance, devices such as
                                                                                               mobile, PC and IPTV, as well as services,
marketing and                                league set up what it called "Fan War
                                             Rooms" for each of the league’s teams,
                                                                                               including Facebook, Twitter, Linkedin);
                                                                                               content types (such as user-generated
sales                                        in which fans could interact with
                                             each other about their specific team’s
                                                                                               media, short-form video and long-form
                                                                                               video); units (for example, ad units); and
The end of the marketing funnel may          draft picks. The NFL also provided a              pricing models (such as cost-per-action,
lead to significantly more, earlier,         constant live stream of tweets directly           cost-per-engagement or cost-per-
deeper and richer opportunities to           from draft headquarters through                   desired-outcome).
build a dialogue with prospects and          the days of the event and created a
customers, and can offer an enhanced         widget for Facebook that enabled fans             This increased fragmentation means
opportunity to build relationships and       to follow the action via their own                analytics must be focused on a
influence choice. At the most basic          Facebook pages.8 In preparation for               wide range of communication: what
level, this entails companies embracing      the 2009 season kickoff in September,             customers tell the company through
(not controlling) all the tools and social   the league expanded its social media              tweets, Facebook, user
media their customers are using to join      and community section at to               reviews, emails, phone and other
the conversations and meaningfully           include “fan postings, live chats with            channels; what they say to each other
engaging with customers—or, at the           players and coaches, fan-edited video             through these channels; and how
very least, gaining insights into what       highlight reels, aggregated Twitter               they interact with other companies.
customers are thinking and feeling,          and Facebook feeds, quizzes, polls and            Furthermore, users increasingly want
which could lead to new opportunities        other similar material.”9                         to enjoy experiences in a seamless
to reach them.                                                                                 way across multiple screens and
                                             Social media monitoring tools also can            platforms. The permutations of all
As an example, Virgin America has more       glean both quantitative and qualitative           these variations will require much
than 20,000 followers on Twitter, which      responses to advertising campaigns for            more than simple spreadsheets and
gives the airline incredible access to       promotions, illuminate opportunities              gut feel to create the most appropriate
an engaged and loyal community of            to improve one’s brand, uncover                   experiences for each customer
customers. But beyond simply enabling        significant unmet customer needs, and             segment, and will make optimal
Virgin to quickly and inexpensively          identify people who may be highly                 marketing spend allocation decisions.
reach customers, the airline’s Twitter       predisposed to a brand or product.
account actually does the selling for the    Furthermore, we believe there will be
company when newcomers ask if they           significant and disruptive innovations
should fly Virgin.                           within the next five years in the area
                                             of highly relevant, targeted marketing emails its customers           that becomes part of the perceived
automatically three weeks after they         high relevance of the experience
have bought something to encourage           itself. Companies that embrace such
customers to post a review of what           innovations will be positioned to
they’ve purchased. The company’s             have a much greater influence on
chief marketing officer says doing so        consumers’ choices and, consequently,
not only makes customers feel valued,        realize significant increases in revenue
but also strengthens the connection          and profitability and sustained
between the company’s brand and its          competitive advantage.
customers. As a result of the program, saw a more than 300            As fragmentation increases across the            6
percent increase in new reviews posted.      board, companies will have to adopt              article/2009/07/12/AR2009071200319.html
In addition, because customers who                                                            7 “What Do You Think?” Geoffrey A. Fowler, The
                                             more sophisticated analytics and
                                                                                              Wall Street Journal, October 12, 2009, page R6.
respond to the emails can be verified        dynamic optimization capabilities to             8 “How NFL is Drafting Fans Via Social
as actual customers,           fully capitalize on social media channels.       Media," Elaine Wong, Brandweek, April
is able to identify reviews by these         More specifically, companies will                23, 2009,
individuals as coming from actual            continue to see increased fragmentation          e3i202b681b4f137513fd1730c682acf73b
purchasers, which adds authenticity          in almost all attributes of user                 9 “NFL Kicking Off Some Site Upgrades,” Eric Fisher,
to the reviews and further bolsters the      experiences as well as in performance            Sports Business Journal, September 7, 2009, http://
company’s credibility.

                                                                                          The New Frontier of Marketing Sales and Service | 11
                  Support and                                many leading companies crawl third-
                                                             party sites to understand customer
                  service in the                             service issues and proactively respond
                                                             before they can impact their brands.
                  social media era                           Other leading companies—aided by the
                                                             use of new capabilities from enterprise
                  Consumers today increasingly see           software providers—are using sites such
                  social media as channels and tools         as Twitter to more quickly solve service
                  for customer service. Indeed, one          questions. A great example is Comcast,
                  recent study found that 43 percent of      which managed to turn a customer's
                  consumers think companies should use       "Tweet" into a case study on how to
                  social media to solve their problems.10    learn about and resolve a customer’s
                                                             issue via a social network. In this
                  A number of leading enterprises have       case, an influential customer (a well-
                  taken major strides toward fulfilling      known tweeter with 12,000 followers)
                  such wishes by creating an online          called out Comcast via Twitter for the
                  environment that enables customers         trouble he was having with his Internet
                  to interact with each other as well        connection. Comcast discovered the
                  as company representatives to find         tweet and, within 20 minutes, responded
                  solutions to their issues. For example,                          13
                                                             and restored service. In his speech at
                  Sybase utilizes newsgroups to enable       the 2009 Web 2.0 Summit, Comcast
                  users to communicate with product          CEO Brian Roberts said Twitter “has
                  engineers and other users about            changed the culture of our company.”14
                  specific issues, thereby creating a
                  forum for customers to seek and            Social CRM is driving a sea
                  obtain technical support. And this is      change that is requiring
                  a rich experience: the customer gets       companies to invest in new
                  multiple answers to his question from
                                                             service and support capabilities.
                  a variety of sources, including super
                  users (“Team Sybase” volunteers) and       From                      To
                  Sybase employees. Furthermore, each
                  community forum is categorized by          Static                    Dynamic
                  product to simplify the customer’s         Knowledge                 Knowledge
                                                             Management                Monitoring
                  search for information.11

                  A variation on this theme is the           Call Center               Social Media
                  approach taken by Samsung, which           Operations                Integration
                  partnered with CNET to create an
                  online community for all Samsung                                     Information
                  products. Although the forum is staffed                              Gathering and
                  by Samsung employees, it is far more                                 Analysis
                  than just a “Q & A with Samsung.” The
                  company acknowledges that often the
                  most helpful answers come from forum       10 “Cone Finds That Americans Expect Companies
                  members themselves, and encourages         to Have a Presence in Social Media,” company
                                                             news release, September 25, 2008, http://www.
                  users to contribute their insights to
                  help those with questions.12 The key is    11
                  to determine how to “authorize” users      forums
                  to provide assistance and enable and       12
                  support the most helpful of these users.   13
                  Transforming the ways in which service     14 “Comcast: Twitter Has Changed the Culture
                  is provided is only the beginning.         of Our Company,” MG Siegler, TechCrunch,
                  Social CRM also can be used to help        October 20, 2009, http://www.techcrunch.
                  companies proactively unearth issues       the-culture-of-our-company/
                  before they become problems. Indeed,

12 | Social CRM
Figure 4. The “virtuous loop” knowledge management lifecycle.

Authors create and/or                                                                                           Publishing workflow
modify content. Authors                               Aut                                                       allowing for review,
now may be customers                                                                 P                          approval and publishing.
as well.

Content analytics are

critical to understanding
what content is being
used and rated. These
analytics provide insight
to where improvements
are needed and what is
working well.

                                                                                                                Users (i.e., agents and

                                                Fe                                    n
                                                  ed                               Co
                                                    bac                                                         customers) use the
Users provide feedback                                 k
                                                                                                                content. Analytical data
such as recommendations
                                                                                                                is gathered based on
for new content or updates
                                                                                                                this usage.
needed and/or ratings on
how useful content is. has announced it will           developed knowledge management                  external communities to handle Tier 1
integrate Twitter into its solution,           systems. Importantly, the integration           and possibly even Tier 2 levels of service
complementing its existing integration         should support a “virtuous loop” that           inquiries. Such communities, which can
with Google and Facebook. This                 provides for a continuous process of            provide a high level of service at costs
solution will enable a company to              learning, whereby solutions and answers         most companies cannot touch, include
both conduct automated searches                are created and strengthened by input           not only ad hoc collections of customers,
of Twitter content to be pulled into           from both customers and internal                but also more formal entities such as’s system, and to                resources—which, in turn, makes the             CrossLoop. CrossLoop is a “consumer
set up alerts when Twitter users               overall online service experience more          Internet company that empowers
mention the company name to track              robust, helpful and easier to use (see          everyone to help someone anywhere in
sentiments.15 Of course, such tools do         Figure 4). The key to such a virtuous           the world with its free and easy-to-use
not completely obviate the need for            loop is a technology platform that              software application for desktop sharing.
personal intervention. Virgin America,         can support customer forums, self-              CrossLoop connects computer users with
for instance, has the equivalent of            service FAQs and internal knowledge             trusted, qualified service providers and
1.5 people dedicated solely to                 management in the same framework.               friends who can provide the support
monitoring and engaging Twitter and                                                            they need quickly and conveniently.”
other social networks to understand            Second, social CRM gives companies the
what customers are saying about                opportunity to redefine the roles played
the airline.16                                 by their contact centers and the agents
                                               who work in them. Indeed, with an
In incorporating social media into             increasing volume of simple transactions
its service and support operations, a          being supported by self-service channels
company must keep several things in            (including mobile devices, IVR and
mind. First and foremost, companies            kiosks), the role of the call center
must ensure they integrate their               gets drastically diminished. For many           16
customer forums with their internally          companies, it may make sense to allow           content/article/2009/07/12/AR2009071200319.html

                                                                                          The New Frontier of Marketing Sales and Service | 13
However, even with external               Finally, companies can improve the           In terms of service and support,
communities handling much of the          user experience while reducing service       organizations need to leverage social
initial service requests, companies       and support costs by building into their     media and Web 2.0 tools to create more
still can expect direct calls from        products or services some capability         robust service and support capabilities
customers unwilling or unable to take     that enables customers or the devices        that enable customers to interact
advantage of self-service options—so      themselves to proactively take charge        with each other as well as company
companies must have agents who            of problems on their own. An obvious         representatives to find solutions to
can provide personal service when         example of this “soft panel” approach        their issues quickly and easily. Robust
needed. If a company has adopted the      is the ability of devices such as the        customer forums, powered by passionate
preceding principle of “virtuous loop”    Xbox and iPod to assess the condition        customers who are appropriately
knowledge management, the time            of the device each time it is connected      incented and rewarded by the enterprise,
needed to resolve these issues will be    to the Internet and automatically            are especially critical to making these
substantially reduced and first-call      download or suggest new software to          sites preferred sources of solutions to
resolution will be much more likely.      correct any shortcomings.                    customers’ problems. Also, companies
                                                                                       that crawl third-party sites to proactively
Third, each interaction—regardless of
the channel in which it occurs—must       Conclusion                                   identify possible service issues mentioned
                                                                                       in consumers’ online conversations can
be united into one complete composite                                                  avoid or reduce the impact of potentially
                                          We are at a tipping point. The majority
customer record that can provide                                                       bigger problems that arise when issues
                                          of customer CRM interactions now
accurate, cohesive service. In other                                                   are left unaddressed.
                                          are occurring outside of company-
words, a social CRM strategy should
                                          controlled channels, and companies
ensure that interactions with call                                                     By making social CRM an important
                                          must adjust their CRM operating
centers become more customer-focused,                                                  element of their customer strategies,
                                          models to adapt and engage these
value-added and relationship-based.                                                    companies are better positioned
                                          outside channels to drive growth and
The key is that companies no longer can                                                to achieve a stronger and more
                                          keep customer satisfaction high.
optimize a single channel, but rather,                                                 differentiated market position, provide
must optimize the customer experience     As noted, consumers are increasingly         superior service, lower operational costs
across all channels of support, which     active users of social media sites, and      and attain a competitive advantage—all
requires the integration and analysis     they also view such sites as purveyors       of which helps them take major strides
of structured as well as unstructured     of important and trusted information         toward high performance.
data in real time. Technologies that      on companies, products and brands in
exist today make such “voice of the       which they are interested. Companies
customer” analysis much more active,      that recognize, embrace and integrate
enabling companies to analyze a           social CRM into their customer-
customer contact as quickly as five       facing operations for marketing, sales
minutes after the interaction.            and service are better positioned to
                                          simultaneously improve their consumer
Fourth, the interconnectedness of
                                          relationships while reducing the cost of
today’s high-tech products via the
                                          marketing, selling and delivering service.
cloud enables companies to get more
information on a customer’s situation—    From a marketing and sales perspective,
using low-cost, offshore engineering      companies should embrace the same
resources as well as a new generation     social media sites their customers use,
of automated tools that can rapidly       and use those sites to both create
collect and sift through data to glean    dialogues with customers to help
insights into what a customer is          them with their purchase decisions,
experiencing—than they would get          and mine sites for information on
through an initial phone conversation     what customers are saying about the
with a much more costly customer          company and its products. New tools
service agent. This arrangement has       that enable the amalgamation and
the potential to substantially reduce     analysis of a wider range of quantitative
the cost structure of support while       and qualitative data will be a key
streamlining and simplifying the          enabler in this regard.
process for consumers.

14 | Social CRM
About the Authors                           About Accenture
Todd R. Wagner is a senior executive        Accenture is a global management
leading Accenture's Management              consulting, technology services and
Consulting CRM practice for                 outsourcing company, with more than
Communications and High Tech in             176,000 people serving clients in
North America. He specializes in            more than 120 countries. Combining
customer experience strategy and            unparalleled experience, comprehensive
operations across marketing, sales          capabilities across all industries and
and service for enterprise and              business functions, and extensive
consumer facing technology                  research on the world’s most successful
companies. He can be reached at             companies, Accenture collaborates                with clients to help them become
                                            high-performance businesses and
Joe Hughes is a senior executive in         governments. The company generated
Accenture’s Global Systems Integration      net revenues of US$21.58 billion for
practice and leads the Global Customer      the fiscal year ended Aug. 31, 2009. Its
Service and Support and Integrated          home page is
Desktop Offerings for Accenture's
Electronics and High Tech industry group.
Joe specializes in Voice of the Customer
analysis and the service applications
of Social CRM. He can be reached at

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