Social CRM Possibilities and Challenges

Transcription

1 White Paper Social CRM Possibilities ad Challeges With the advet of social techologies, the cotrol has shifted to the hads of the customer. Brad messagig has moved from customer push to customer pull. There is a sigificat amout of coversatio betwee customers who are thousads of miles apart o social media chaels potetially impactig the brad across geographies. With these rapid chages, busiesses eed to alter their strategy to adapt to this ew customer touch poit ad use it to their advatage. The existig CRM strategies eed to be refied to iclude social chaels thus layig the path for a Social CRM. While traditioal CRM solutios cotiue to aggregate ad aalyze customer data ad automate workflows for busiess process optimizatio, the ew-geeratio CRM egages customers o a real time basis through social media, leveragig commuity platforms, eterprise feedback maagemet, product reviews sites, ad social moitorig tools. Social CRM applicatios ecourage may-to-may participatio amog differet stakeholders ad allow egagig customers i differet scearios such as ideas for iovatio, developmet of ew products ad services, word-of-mouth marketig, price comparisos ad product reviews. With leadig brads demostrably achievig success i usig Social CRM ad more compaies evaluatig what it could mea for them, this paper illustrates how exactly Social CRM will impact busiess fuctios like marketig, operatios ad customer support. It also discusses the challeges ivolved i adoptig CRM ad metrics that ca be used to evaluate success.

2 About the Authors Geeta Rohra Geeta serves as a Cosultat with the Coect Marketig Solutios group i Corporate Techology Office. As part of her curret role, she moitors the treds i Social Media Aalytics ad develops strategies that ca be adopted by eterprises. Her core areas of expertise are busiess itelligece, data itegratio, data quality ad social aalytics. I additio to these core coverage areas, Geeta cotributes to areas such as Master Data Maagemet, Customer Relatioship Maagemet, ad Digital Marketig icludig Social Media Marketig. Mridul Sharma Mridul Sharma heads market strategy for Coected Marketig Solutios at TCS, as part of the CTO Group. This icludes helpig Global 5000 orgaizatios across Bakig, Fiacial Services, Telco, Retail sectors to defie ad implemet digital strategy, eable marketig automatio through eterprise marketig maagemet, create customer egagemet ad coect through digital ad social media all i a effort to deliver superior customer experieces that create brad advocates. 2

3 Table of Cotets 1. Itroductio 4 2. What is Social CRM? 5 3. Traditioal CRM v/s Social CRM 5 4. Idustry Adoptio ad Social Experimets 7 5. Steps to Social CRM Social Metrics Challeges ad Pitfalls Social CRM Ecosystem Coclusio 13 3

4 Itroductio Welcome to the ew age customer, who checks mails o a smart phoe, catches up with the latest ews olie, coects with frieds o Facebook, voices his/her opiio o the latest ati corruptio movemet i the coutry, ad checks out reviews ad ratigs of various car models before takig a test drive for a ew car. Always wired is ow a way of life ad the expoetial rise of social media has brought about a paradigm shift i the reach ad impact of coversatios amogst the customers. With this, the older CRM paradigm of maitaiig what ca be defied as closed relatioship maagemet is fast disappearig. The more domiat of the social media chaels iclude: Facebook Domiat social etwork with a user base toppig 750 millio + Twitter A 140 character short burst of coversatio or aoucemet havig a 250 millio + user base ad growig. LikedI A social etwork geared for professioals lookig to coect professioally that has millio users. YouTube Olie video site with a lot of user geerated cotet toppig 3 billio video views per day. Wikipedia A self-goverig user geerated cotet powered ecyclopedia of iformatio with as may as 9 millio + articles. (Statistics as of August 2011) Why has the shift bee so proouced ad dramatic? A survey delvig ito the mid of the cosumer leads us to the very basic huma criteria of a circle of trust, explaiig that oe is more likely to trust ad rely o the advice of frieds ad family essetially a more trusted etwork of people tha a marketig/promotio message that has bee carefully massaged by corporate executives. This circle of ifluece is ow further leveraged to make a geeral assessmet of a compay s products, services or offerigs through user geerated reviews, ratigs, or commuities. This patter is ot oly limited to the busiess-to-cosumer segmet but exteds to the busiess-to-busiess segmet as well where the results are equally startlig: 50 % were likely to use forums ad discussio groups. 25 % use ratigs ad review sites. 20% were likely to leverage commuities to help them make more iformed purchase decisios. So i essece, the rise of social media ad chaels has see the coversatio about a compay or brad shift from a customer compay coversatio to a customer customer compay dialogue, potetially all of which is takig place i the ope. Social media has re-iveted the traditioal marketig fuel from a cotrolled push message drive by compaies, their marketig departmets, brad maagers ad creative agecies to a more real-time dialogue amog customers or prospects i all the stages of ifluece. 4

5 This paper is a result of the authors experiece i the space of customer ad marketig aalytics with a focus o social media aalytics ad Social CRM, moitorig treds ad developig strategies for adoptio by eterprises. The paper is orgaized i the followig sectios: What is Social CRM? Traditioal CRM v/s Social CRM Idustry Adoptio ad Social Experimets Steps to Implemet Social CRM Social Metrics Challeges ad Pitfalls Social CRM Ecosystem Coclusio What is Social CRM? A umber of compaies have successfully adopted the ew paradigm, ad proved that social CRM ca have a very sigificat beeficial effect o each of the fuctioal areas of a busiess. Social CRM applicatios ecourage participatio amog various stakeholders i order to support sales, marketig, as well as customer ad busiess processes. It egages customers i differet scearios, such as, ideas for iovatio, developmet of ew products ad services, word-of-mouth marketig, price comparisos ad product reviews. Some of the largest brads have icreased their digital sped ad have started experimetig with social media to egage with the customer ad provide a improved customer experiece. Examples of compaies usig social media iclude Bak of America, which has bee successfully ruig customer services via Twitter ad Dell i the Hi Tech idustry, which has used social media effectively to drive sales ad icrease reveue. Paul Greeberg, the godfather of CRM describes the pheomea of Social CRM as: A philosophy ad a busiess strategy, supported by a techology platform, busiess rules, workflow, process, ad social characteristics, desiged to egage the customer i a collaborative coversatio i order to provide mutually beeficial value i a trusted ad trasparet busiess eviromet. Social CRM is the compay s respose to customer s owership of the coversatio. Traditioal CRM v/s Social CRM To a layperso, Social CRM might soud the same as CRM. However, there are may subtleties ivolved that warrat the eed for Social CRM as a practice i its ow right. 5

6 Closed v/s Ope Relatioship While traditioal CRM solutios aggregate ad aalyze customer data ad automate workflows for busiess process optimizatio, the ew geeratio CRM egages customers o a real-time basis through social media chaels, commuity platforms, eterprise feedback maagemet, product review sites, ad social moitorig tools. The focus has shifted from beig a oe-o-oe relatioship with the customer to a more collaborative experiece ivolvig multiple customers ad etworks talkig to each other ad the compay or brad. Customer Iteractio Social CRM also impacts a busiess customer iteractio chaels. Traditioal CRM works to icorporate a sigle view of the customer across chaels such as phoe, , fax, call ceters, chats; i essece, a somewhat cotrolled iteractio with the customer which is captured i systems i a attempt to provide a complete picture of the customer. Social CRM has added more layers ad complexity to this iteractio. No loger is the customer directly iteractig with the compay i a cotrolled maer through the chaels dictated by the compay but is also expressig himself/herself o public forums such as blogs, wikis, discussio forums, social etwork sites, photo/video sites, ad product/service review sites. Capturig this iformatio effectively ad creatig a sigle view of the customer hece becomes more difficult to achieve. Processes ad Techology Traditioal CRM looks at the customer iteractio lifecycle from a compay s stadpoit, that is, customer targetig, customer acquisitio ad customer retetio somethig that is viewed as process cetric, which eeds to be formulated ad reviewed to esure smooth operatios. This has meat that various stages i the sales ad lead process or customer service have to be carefully maaged ad optimized for operatioal efficiecy to esure effective icrease i sales or umber of service cases closed to esure meetig of service level agreemets. Social CRM however shifts the focus to a customer ad the dialogue with the customer, as the ceterpiece, ad the compay has to alig its operatios aroud this to eable more customer cetricity. This requires compaies to adapt their operatios ad processes to facilitate the chael or medium the customer is commuicatig i ad to create a relevat ad meaigful coversatio. A similar shift is oticed i the techology supportig the two approaches while CRM eables the capturig of iformatio ad maagig of the process more effectively, Social CRM eables the creatio of a eviromet where customers ca iteract with each other (ad with the compay) to help each other, provide guidace ad thought leadership ad ifluece each other o behalf of a brad or a compay. Adoptig Social CRM meas a evolutio of the customer beig at the ceter of the iovatio cycle of the compay; either solvig problems or creatig ideas through crowd sourcig, which compaies ca effectively leverage to lead them to ew heights. However, achievig this requires compaies to be preset i the social area, where the customer is preset a startig poit would be listeig to the voice of the customer. Hece, Social CRM alleviates the shortfall i traditioal CRM, from optimizig iteral busiess process to adoptig a collaborative approach ad havig the customer at the cetre of all actios. 6

7 Idustry Adoptio ad Social Experimets The followig figure illustrates the role Social CRM ca play i supportig busiess fuctios like sales, marketig, customer service, ad product developmet. Marketig Brad Advocacy Market Research Listeig & Ogoig Customer Iteractios Targetig Customer Customer Collaboratio Customer Acquisitio Sales Word of Mouth Customer Retetio Product Developmet New Product Features Service & Support Customer Self Support Figure 1: CRM Fuctios Marketig Social use cases for marketig iclude: Campaig respose maagemet Viral marketig ad lead geeratio Brad advocacy that ca help build brad loyalty Brad reputatio maagemet Market research ad aalysis, icludig competitor trackig ad threat trackig Marketers come up with egagig cotet, videos ad applicatios which compel users to share with frieds ad other olie users. This has a compoudig effect ad very soo reaches a very large umber of people. A very popular case of viral marketig is Burger Kig, a fast food restaurat chai that teamed up with Simpsos to promote the movie with a site called 'Simpsoize Me'. The users could upload their 7

8 ow picture ad create a Simpso character based o that picture. The applicatio also allowed users to create a character based o them that was much older tha their actual age. Users could Simpsoize themselves, add a pet, add backgrouds, the picture to frieds, dowload it ad eve make it their scree saver. Expectedly, users foud this a fu tool to play with ad the campaig was a huge success. With this campaig goig viral, there were reports that Burger Kig had to icrease the servers from 18 to 38 to cope with the icrease i traffic. Ford has similarly built a successful olie brad awareess campaig targeted towards the youth. Normally, a marketig departmet would have to sped millios of dollars targetig ad promotig the lauch of a ew car; i this case, it was successfully ad cheaply achieved through social chaels. Ford ivited 100 social agets to try Fiesta for six moths ad share their experiece with the world. Social agets promoted the car through differet social media sites, icludig Twitter, YouTube ad blogs. Results showed that 38% of Ge Y heard about Ford Fiesta through social media before it lauched i US. Most importatly, they had 50,000 requests for iformatio about the car withi the first six days of sale. Sales While compaies traditioally push sales, the otio of social commerce is pickig up actively as well. Cases iclude: Effective lead capture ad gaugig of customer itet Eabled coversio by providig timely iformatio, guidace or assistace Dell successfully created a oe-to-oe iteractio with customers makig the experiece so delightful that ultimately it was able to trasform Twitter ito a sales chael, icreasig sales reveue by $6.5 millio i the first year of egagemet with customers. Procter ad Gamble s Old Spice campaig Smell like a Ma, Ma leveraged YouTube to create brad awareess ad egagemet, ad was a huge success. These Old Spice commercials geerated 1.8 billio impressios (, people who saw, read or heard about the commercials) ad a 2,700 percet icrease i Old Spice Twitter followers. This campaig also resulted i Procter ad Gamble s sales of Old Spice growig i the double digits. Customer Service ad Support Customer service ad support has adopted social chaels for: Olie grievace maagemet Solicitig customer feedback/commets Rapid respose maagemet Apple has extesively leveraged digital media to improve its customer service. Apple provides comprehesive iformatio ad service optios olie, itegrated with YouTube to provide service for existig products plus ew product promotioal iformatio. To further stregthe the operatio, the overall store ad call cetre iformatio is itegrated, providig flexibility to customers to select the chael they prefer. 8

9 They have see a umber of beefits with this approach, most otably the reductio of cotact ceter calls, thereby reducig cost of service ad improvig operatioal efficiecy. I additio, they are able to provide more comprehesive service to the customer deflectig the service burde from stores ad lettig them focus o the customer experiece aspect of product iteractio ad sales. Alog similar lies, Leovo has lauched a commuity website as a meas to proactively egage with its customers ad offer olie service ad support. Leovo was able to reduce laptop service call volume by 20%. Product Developmet I the area of product developmet, social media ca be leveraged for the followig: New product ideas through crowd sourcig. Pricig ad service idea geeratio. Competitive moitorig. Starbucks created a cosumer portal 'My Starbucks Idea', a iitiative for cosumers to share ideas or suggestios that would improve The Starbucks experiece. The ideas submitted by the cosumers are commeted o ad voted by other cosumers. Cosumers ca also check the status of the ideas submitted, whether they have bee reviewed, i the works or lauched. A leader board displays the top te users based o the scores, that is, the umber of ideas submitted ad the correspodig commets ad votes. Accordig to Starbucks early 75,000 ideas were submitted i just six moths, of which over 50 were implemeted. This has geerated a huge amout of publicity ad is a classic case of 'crowd sourcig', that is, a task which would ormally have bee doe i house by the marketig team has ow bee outsourced to the user group i a ope forum. Crowd sourcig ot oly helps cosumers feel importat ad that they matter to busiess, but also helps busiess by geeratig ew product ideas from the wisdom of the crowd. Proctor & Gamble (P&G) lauched the Coect + Develop iitiative, tappig ito a global iovatio etwork comprisig a host of sources, from idepedet iovators to virtual iovator etworks such as IoCetive (matchig scietists to busiess research ad developmet challeges). The compay idetifies promisig ideas from the etwork ad applies its ow research ad developmet (R&D), maufacturig, marketig, ad purchasig capabilities. I the ope sourcig developmet through digital chaels, P&G deepes the relatioship with cosumers ad develops products closer to cosumers eeds. More tha 35% of P&G s ew products have elemets that origiated from outside P&G. R&D productivity icreased by early 60%, ad R&D ivestmet as a percetage of sales is dow from 4.8% to 3.4%. P&G s average two-moth cycle of geeratig physical prototypes ad testig them with cosumers has bee reduced to aroud 24 to 48 hours. Summarizig the value of Social CRM to busiess fuctios, we ca say that egagig with customers o their preferred chaels helps orgaizatios to ot oly provide superior customer experiece but also improve operatioal efficiecy by reducig support calls. I additio, through collaboratio, listeig to cosumers for latet eeds ad iovative campaigs has a potetial to go viral thereby icreasig the reach of a campaigs at a fractio of the cost for traditioal media. 9

10 Steps to Social CRM Craftig a Social CRM program eeds a step-by-step approach alog with appropriate checks ad balaces. This ca iclude: 1. Defiig the objective to be achieved through social iteractios, which could be customer service ad support, or customer egagemet or attemptig to humaize your brad through commuity egagemet. 2. Preparig for ad bechmarkig your iteral social readiess. This requires ivolvig your iteral stakeholders, employees, ad customer service agets, ad traiig them for social media as it requires a differet skill set. 3. Uderstadig the techological ladscape ad the tools that are available i the market ad idetifyig the oe that is best suited for your objective keepig i mid the existig IT ifrastructure ad corporate security guidelies. 4. Idetifyig how you ited to use the social isights alog with your traditioal CRM iitiatives. 5. Idetifyig the metrics you would use to measure the results. For example, if your objective was to provide superior customer service through social chaels, you might wat to measure how may customers you are servicig through social media over a period of time v/s the call ceter, or percetage chage i the umber of calls i the call ceter. Are you able to track results ad ROI? Are your social media efforts itegrated with your existig CRM applicatio? Do you kow how social your employees ad stakeholders really are? Social CRM Have you assessed IT Ladscape Security Cocers Alig busiess goals to the social objectives Are your social employees traied to hadle this? Figure 2: Social CRM Checklist 10

11 Social Metrics Ultimately, you caot track success if you caot measure ad bechmark your efforts. Some of the metrics that may be captured based o the compay s objective o social media are detailed i the followig figure. These ecompass various stages of customers iteractio with the compay startig at awareess ad culmiatig i the customers becomig true brad advocates ad ifluecers for the compay, product or brad. For example, a compay that would like to improve their brad advocacy would wat to idetify the ifluecers across various chaels ad provide them with a superior experiece to covert them ito brad advocates. Hece, the compay would wat to track Ifluecer metrics. Awareess Egagemet Participatio Ifluece Site visits No. of Iteractios/ Egagemet rate Embeds/Istalls Share of Voice Page views Search Egie visibility Search Volume Treds Media ad Cotet views Time spet with distributed cotet Visits to idetified pages Brad associatio Satisfactio Score No. of Dowloads/ uploads Topic/Setimet Treds No. of Votes No. of Likes/dislikes Setimet of posts Ifluecers by domai Ifluecers by Topic Ifluecers Impact Reach by Chaels Retweets Figure 3: Social CRM Metrics Challeges ad Pitfalls O the way to achievig success i Social CRM objectives, there are some challeges that orgaizatios eed to be ready to overcome. These ca iclude oise, for example, large volumes of social coversatios which may ot all be relevat. Siftig through the oise i order to arrive at actioable isights requires a iterative approach that leverages tools such as listeig platforms to uderstad where the coversatios are takig place ad the setimet associated with the coversatios. Special attetio eeds to be give to eablig quick resposiveess to issues. Due to the wide reach ad ease of collaboratio i the olie sphere, it is ot ucommo to receive backlash that quickly spirals, for ot doig thigs correctly. Hece, it becomes importat to esure that icorrect iformatio is checked quickly to prevet uecessary damage to a brad or reputatio. 11

12 While it is importat to egage with customers, it is also importat that firms be upfrot ad trasparet i their dealigs with customers. Ay attempt to ifluece positive opiio through the use of moetary icetives ca quickly be discovered for what it really is a veiled attempt at buyig good marketig ad press release. This could uduly raise questios o the validity of social media data ad be see as disruptive marketig gimmicks. Social CRM Ecosystem The Social CRM ecosystem cosists of compoets such as social listeig, social collaboratio, profile matchig ad rapid respose maagemet. Social Collaboratio Service ad Respose Maagemet Social CRM Social Aalytics Social Profilig Figure 4: Social CRM Ecosystem Social Aalytics: A critical first step i uderstadig where the coversatios are takig place, what are the hot topics/setimets associated with those coversatios ad who are the ifluecers. It ivolves crawlig the web with a objective to gather all the coversatios across public sites, blogs, forums, reviews ad social etworkig sites. Social Collaboratio: This ca take the shape of creatig a eviromet for the coversatios to take place, be it compay or user/commuity moderated, allowig it to be more of a freewheelig discussio without costat compay itervetio. Capturig social kowledge ca become a effective driver to uderstad the thought process, ad idetify latet eeds of the customers or prospects. This ca also become a effective way to capture eterprise kowledge whe made iteral facig to employees ad parters of a compay. Service ad Respose Maagemet: Social CRM, by its highly visible ad viral ature has the ability to get expoetial visibility very quickly. Hece it requires the ability to quickly address ay potetial difficult issues so as to prevet a egative commet spiralig out of cotrol. Social Profilig: Beig able to successfully capture ad cosolidate a customer s olie social idetity with the CRM record esures that oe has a 360 degree view of the customer ad the issues/topics of iterest to them, creatig a far richer customer profile that ca be leveraged for persoalized commuicatio ad targetig. 12

13 Coclusio Social CRM augmets traditioal CRM by ehacig the existig processes ad keepig the customer at the core of all actios. It has opeed up ew chaels of egagig with customers ad providig a superior customer experiece. These chaels also provide a opportuity for icreased collaboratio amogst peers ad a widow to iclude customers i product iovatios. Compaies eed to embark o a Social CRM program with clearly defied objectives coupled with mechaisms to capture success metrics. While there will be some challeges ad pitfalls associated with rollig out the Social CRM iitiatives, overall the beefits far outweigh the pitfalls. Key pillars for eablig Social CRM iclude social listeig to capture customer coversatios ad setimet, collaborative commuities to foster dialogue ad idetify customer eeds thereby erichig their profile. Fially, keep the dialogue relevat ad curret by eablig rapid respose. Refereces [1] URL: Bak of America o Twitter, retrieved September 4, [2] URL: Adam Ostrow(2009). Dell Rides Twitter to $6.5 Millio i Sales, retrieved September 4, [3] URL: Social CRM (2011). retrieved September 4, [4] URL: Jeff Bullas (2011). The 7 Secrets to Ford's Social Media Marketig Success, retrieved September 4, [5] URL: Iterview Nestlé's Nick Risso, media coectio. Retrieved September 4, [6] URL: Sa Jooste (2011). The Art of Social Media: Procter ad Gamble, Retrieved September 4, [7] URL: Bret Leary (2011). Traditioal CRM vs. Social CRM, retrieved September 4, [8] URL: Busiess Week: Apple Customer Service Leads Computers & Electroics Idustry (2010), retrieved September 4, [9] URL: AppleCare. retrieved September 4, [10] URL: Social etwork user statistics as of July 2011, retrieved September 4, [11] Joural Article: A.G. Lafley, Ram Chara (2008). P&G's New Iovatio Model, Harvard Busiess Review. [12] Research: Peter Burris, Peter O'Neill, Zachary Reiss-Davis ad Madiha Ashour (2010). North America ad Europea B2B Social Techographics Olie Survey Q [13] URL: Just Viral Marketig, Make a Simpso Character of Yourself, retrieved October 30, [14] URL: Michael Gray (2009). Starbucks recipe for social media success, retrieved October 30, [15] URL: My Starbucks Idea, retrieved October 30,

14 Cotact For more iformatio about TCS cosultig services, cotact Subscribe to TCS White Papers TCS.com RSS: Feedburer: About Tata Cosultacy Services (TCS) Tata Cosultacy Services is a IT services, cosultig ad busiess solutios orgaizatio that delivers real results to global busiess, esurig a level of certaity o other firm ca match. TCS offers a cosultig-led, itegrated portfolio of IT ad IT-eabled ifrastructure, egieerig TM ad assurace services. This is delivered through its uique Global Network Delivery Model, recogized as the bechmark of excellece i software developmet. A part of the Tata Group, Idia s largest idustrial coglomerate, TCS has a global footprit ad is listed o the Natioal Stock Exchage ad Bombay Stock Exchage i Idia. For more iformatio, visit us at IT Services Busiess Solutios Outsourcig All cotet / iformatio preset here is the exclusive property of Tata Cosultacy Services Limited (TCS). The cotet / iformatio cotaied here is correct at the time of publishig. No material from here may be copied, modified, reproduced, republished, uploaded, trasmitted, posted or distributed i ay form without prior writte permissio from TCS. Uauthorized use of the cotet / iformatio appearig here may violate copyright, trademark ad other applicable laws, ad could result i crimial or civil pealties. Copyright 2012 Tata Cosultacy Services Limited TCS Desig Services I M I 09 I 12