Social media driving CRM strategies

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2 Rapid changes in social computing, mobile and customer analytics are driving shifts in. In a recent survey, IT identified establishing a CRM strategy as the second greatest challenge, behind instituting organizational change. This E-guide examines how businesses can prepare for the evolving CRM market and address changing customer experience needs. Plus, discover how Nutritional products retailer GNC successfully leveraged social channels and targeting marketing tactics to win new business. CRM through 2015 By Barney Beal, News Director LOS ANGELES -- Gartner analysts said CRM s evolution will require practitioners to pay close attention to social computing, mobile and customer analytics -- a sentiment that s been echoed in the market for years, but one to which Gartner has attached some strategic predictions. We have facing us, social, mobile, an explosion of channels and an explosion of data, said Gene Alvarez, research vice president for the Stamford, Conn.-based research firm, who was speaking at the Customer 360 event being held here this week. Customers are armed with more technology than [businesses] have. We have to be prepared to change for that, and if you think [business-to-business (B2B) companies are] exempt, ask your direct sales force how many of them have used LinkedIn to reach someone inside a prospect. B2B is going to follow this. Among Gartner s strategic planning assumptions for : By 2015, 80% of businesses will suffer revenue loss by not supporting Web-based customer service on mobile devices. Page 2 of 8

3 By 2013, lead management campaigns will be integrated onto four or more digital channels and outperform single or dual channels by 300%. By 2013, four or five new niche software vendors focused on marketing performance management will emerge. By 2014 social CRM vendors will take more than 40% of the market share for campaign management. Through 2015, analytics applications will remain one of the fastestgrowing categories for business apps. Over 70% of all CRM projects through 2015 will be viewed as failures if there is no CRM strategy to drive why a firm is undertaking them. By 2015, social marketing processes will influence at least 80% of consumer s discretionary spending. Need proof? Alvarez outlined a number of shifts in marketing and customer engagement as examples. American Airlines Inc. created a contest providing 30,000 free miles to anyone who posted a video about its 30th anniversary. The Jet Propulsion Laboratory made Mars maps available to the public to help the lab s scientists count craters on the planet. And FLOWERS, a company with an older communication channel in its very name, now allows customers to order flowers from within Facebook. People will follow places, they will even follow data, but forming communities is challenging, Alvarez said. For example, a joint effort between hotel giant Hyatt Corp. and tour guide publisher Frommer s to get customers to comment and share information about attractions and restaurants around Hyatt hotels had to be pulled down when people were not ready to leave Facebook or Twitter to leave comments. Be careful where you put your communities, Alvarez warned. Are you cool enough to get people there? Page 3 of 8

4 For organizations seeking to plan for and adapt to the rapid change, the predictions can be daunting. Ready for CRM s changes? I don t think anybody thinks they re ready for 2015, said Rebecca Parke, a conference attendee and manager of systems integration for Ottawa-based Canadian Payments Association. [Alvarez] talks about everything all over the place. But you can t do nothing. Parke, from the IT side of her company, is at the show to help establish a strategy for the organization moving forward. Strategy is around what you re going to implement next, what will drive roadmap, what does the business want to do, she said. Indeed, for years CRM initiatives have been plagued by a disconnect between IT and business, but according to Gartner, the two sides are now identifying similar problems. In a survey that asked what the greatest customer-facing challenge is, IT identified establishing a CRM strategy as the No. 2 challenge. For business it was No. 3, and both agreed organizational change was the No. 1 problem, Alvarez said. For Michael Presta, global marketing manager of Sykes Enterprises Inc., a Tampa, Fla.-based customer service outsourcer, the changes in CRM present a challenge in that his company cannot necessarily look to a software vendor for help. Its customer service representatives (CSRs) are tied to the system its clients want it to use. Strategies for social CRM and the flood of channels and data present a problem. We re getting ready, Presta said. A lot of people are searching for how to get ready. The model is so entrenched for customer experience being built to the voice model. After years and years of one model, now it s this paradigm shift. The difficulty is operationally trying to get that mind shift altered. Page 4 of 8

5 For some of its larger clients, Sykes has begun offering community moderation. Because the company recruits and trains CSRs, it instills skills that map to social networking. We have to convince them, you guys need to do this, Presta said. But I think just about everybody is on board with it. It s not a hard sell. About the Author: Barney Beal is the News Director for the Business Applications and Architecture Group at TechTarget. You can follow him on Twitter By Rosemary Cafasso, Associate News and Site Editor Company: General Nutrition Centers Inc., a global retailer of nutritional products, such as vitamins, sports nutrition supplements, herbs and energy products, with 4,800 retail locations in the U.S. Social tools: Radian6, a social monitoring tool recently acquired by Salesforce.com, a beta version of Crowdbooster, a social media dashboard, and all the free tools, including Twitter and social media analytics tools. Social CRM goal: Extend customer service and engagement on social channels, serve as online trusted adviser and create a net increase in the discussions about GNC, according to Chris James, director of social media at GNC. GNC s social strategy: James works with a few part-time community managers to monitor what is being said about the brand on a variety of social channels, from Facebook and Twitter to niche communities of bodybuilders. The community managers observe conversations in real time with Radian6 social monitoring tools. Page 5 of 8

6 The Radian6 dashboard can be configured to present social data in various forms including verbatim comments and timelines, comment totals per channel and bar charts that illustrate activity. The software can also be used to identify key influencers -- the people that other people listen to -- based on followers and comments. But, it is only as good as the eyeballs on it and the brain behind it, James said. The community managers determine what comments warrant a response, which are best ignored and which ones get classified as potential problems that need a direct response from customer service. James, meanwhile, is handling what he calls the 50,000-foot view. James can spot trends and tweak marketing strategies based on Radian6 reports. For example, James said he can connect a revenue change with a particular product based on activity around an online event, such as issuing a coupon. The company recently was able to quickly issue a coupon on coconut water because it had instantly seen such a huge spike in demand for the product. "We were really getting hit on margin on that, James said. GNC is also using social monitoring tools to track online activity around the current cross fit trend. Cross fit is an intensive exercise and training program that involves calisthenics and various weightlifting techniques. Participants work toward personal goals and compete against members of a group of peers. By listening to cross fit-related conversations, GNC plans to better target products to this community. We are identifying the scope of this; the major players and are finding out where they are hanging out and what they consider [as nutritional] supplementation, James said. It s a fundamental shift in how we are finding new customers and a lot faster than commissioning an expensive study. Page 6 of 8

7 James creates high-level summary reports that he forwards to GNC s CEO to provide a big-picture take on market activity and opportunity. By looking at trends on different online channels, James can see where different customer segments are congregating. It shows me where we are really kicking butt, he said. It has allowed me, for instance, to discover that Twitter was as much of an opportunity for us as Facebook. Through social media monitoring, James has been able to better target engagements with customers by seeing who they are on each forum. For example, although he does not yet know why, James knows that the bulk of most GNC customers on Facebook are 18- to 25-year-old males, while more female and Latino GNC customers are using Twitter. From monitoring, James and the community managers have learned to step in and comment when someone is asking a general question, but to stay out of exchanges between friends. If they are asking a friend, they want to hear from the friend, not us. Page 7 of 8

8 Free resources for technology professionals TechTarget publishes targeted technology media that address your need for information and resources for researching products, developing strategy and making cost-effective purchase decisions. Our network of technology-specific Web sites gives you access to industry experts, independent content and analysis and the Web s largest library of vendor-provided white papers, webcasts, podcasts, videos, virtual trade shows, research reports and more drawing on the rich R&D resources of technology providers to address market trends, challenges and solutions. Our live events and virtual seminars give you access to vendor neutral, expert commentary and advice on the issues and challenges you face daily. Our social community IT Knowledge Exchange allows you to share real world information in real time with peers and experts. What makes TechTarget unique? TechTarget is squarely focused on the enterprise IT space. Our team of editors and network of industry experts provide the richest, most relevant content to IT professionals and management. We leverage the immediacy of the Web, the networking and face-to-face opportunities of events and virtual events, and the ability to interact with peers all to create compelling and actionable information for enterprise IT professionals across all industries and markets. Related TechTarget Websites Page 8 of 8

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