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 product.3 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, 2009, http://mashable.com/2009/07/28/social- 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 Direct Phone Call Center Mail Lead Gen Rep Phone New World Social Video IP TV TV Rating Sites Paid Search Widgets entertain inform convert Website connect assist Blogs Call Rep Print Center Mobile Email Organic Banner Search Community Lead Gen Direct Mail 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 Mint.com, 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 Mint.com,” Intuit press be careful to balance the online release, September 14, 2009, http://about.intuit. 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, Amazon.com user media their customers are using to join and community section at NFL.com 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 6 should fly Virgin. within the next five years in the area of highly relevant, targeted marketing Drugstore.com 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, Drugstore.com saw a more than 300 As fragmentation increases across the 6 http://www.washingtonpost.com/wp-dyn/content/ 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, Drugstore.com fully capitalize on social media channels. Media," Elaine Wong, Brandweek, April is able to identify reviews by these More specifically, companies will 23, 2009, http://www.brandweek.com/bw/ content_display/news-and-features/direct/ 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:// 7 www.sportsbusinessjournal.com/article/63490 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 Desktop products. Although the forum is staffed Gathering and Applications 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 coneinc.com/content1182 help those with questions.12 The key is 11 http://www.sybase.com/support/community- to determine how to “authorize” users forums to provide assistance and enable and 12 http://forums.cnet.com/5204-13973_102-0. html?forumID=146 support the most helpful of these users. 13 http://www.penn-olson.com/2009/09/21/5- social-media-disasters/ 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. com/2009/10/20/comcast-twitter-has-changed- 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 hor modify content. Authors Aut allowing for review, now may be customers P approval and publishing. as well. ub lis h Content analytics are Analytics critical to understanding what content is being used and rated. These analytics provide insight to where improvements are needed and what is working well. me Users (i.e., agents and su 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. Salesforce.com 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 salesforce.com’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 17 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 15 http://thenextweb.com/2009/03/23/salesforce- mind. First and foremost, companies kiosks), the role of the call center integrates-twitter-service-cloud/ must ensure they integrate their gets drastically diminished. For many 16 http://www.washingtonpost.com/wp-dyn/ customer forums with their internally companies, it may make sense to allow content/article/2009/07/12/AR2009071200319.html 17 http://crossloop.com/about/aboutus 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 firstname.lastname@example.org. 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 www.accenture.com. 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 email@example.com. Copyright © 2009 Accenture All rights reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.
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