I'm heading out to the Gartner CRM Conference on a post-Hanna beautiful day in Washington DC - the metro area - and before I go, I figured I'd do the "safe" blog entry. One that exposes another excerpt of another chapter of the now delayed to 1st Quarter of 2009 CRM at the Speed of Light 4th Edition.
This one? Chapter 7, the one about social media - of course, always from the perspective of CRM and its 2.0 derivation.
So, to start, the Wordle for the entirety of the chapter - which is interesting since the two clearest words are "social" and "CRM" in it. Though I suppose that would be the case in a CRM book chapter on social media.
Sigh. Not much of an insight.
Oh yeah, a note or two. There's gonna be some short blogging and maybe a tweet or two from Gartner CRM this week and listen for podcasts that will be loaded up to the newly rolled out MyCRMCareer (not "so-called") site, powered by Neighborhood America. Well worth listening to. Video and the like will be up and rolling too. Got something cooking with some strong industry heavyweights for that one.
Okay, also, watch for a blog entry coming up on Helpstream, a company that I really like that is one of the most representative CRM 2.0 applications - for customer service - I've ever seen. Meaning these are people who just seem to get the way the world goes. That's soon.
The Wordle....GO!!
The chapter excerpt....NOW!!
(1)The Value of Social Media in CRM
Charlene Li, the former Forrester analyst and co-author (with Josh Bernhoff) of "Groundswell" (well worth reading) defined the use of social computing as "a social structure in which technology puts power in communities not institutions."
Those technologies are the social media applications and the vessels for human participation - the social networks and communities that have begun to redefine the way that businesses are looking at working with their customers.
Social media - the blogs, podcasts, videocasts, wikis, RSS feeds, social tagging/bookmarking and to a lesser extent, text and instant messaging - have been the available to consumers for years and they've been using them to communicate with each other. Text messaging has been a staple of communication since 2001. In 2001, there were 17 billion text messages sent; by 2004, there were 500 billion text messages sent; in 2007 it was 1.9 trillion and that is only going up according to Gartner who expect the final numbers in 2008 to turn out to be 2.3 trillion.
But it is only very recently that businesses are beginning to see the value of social media as a means of communicating with customers - and that only because the customers expect that kind of communication. There is a real reluctance to move forward, but the upward pressure of customer demand is pushing IT departments in particular forward to deploy these tools
Part of the disinclination was simply IT budgetary constraints. For example, as late as June 2008, a Forrester report about the U.S adoption of Web 2.0 technologies found that of 729 IT decision-makers at U.S companies with 500 or more employees, 64% of the IT shops, wouldn't' invest in wikis in 2008 and 69A% wouldn't invest in blogs; 66% have no interest in RSS investment.
But the chant keeps getting louder. Statistics are there - Gartner estimates that by early 2009, 50% of all corporations will have social software or its components up and running. But it isn't the numbers that drive it, it is that chant which goes "Customers are going to have the conversation with or without you. Whether or not you give them what they need to have it with you is up to you, fair enterprise."
(2)What Are the Tools?
In the next 4 chapters (including this one) we're going to cover the most important and newest tools of CRM 2.0 - the social media and social networks that have been such a hot topic in the media. The more traditional tools and practices will be covered in Section 3.
(3)Social Media, Social Networks - I Don't Get It, Do I?
Actually, you do. You're using them, or reading them or commenting on them or even donating through them or seeing them or hearing them or writing on them. A study completed in August 2008 by the Interpublic Universal McCann (UM) unit called "Media in Mind" found that more than half of all adults are relying on at least one of the social media, o.k. Web 2.0 platforms for communicating on a regular basis with someone from somewhere. The specific forms of communication are social networks, text messaging, blogging, or some other digital interaction. In fact, in the 18-34 year old bracket, Gen Y., social media is the dominant form of communications according to the study, with, get this, 85% using Web 2.0 platforms to stay in touch with others. Universal McCann's conclusion, which is correct, is
"Although age is the driving force behind usage patterns of these technologies, it is clear that a fundamental shift has taken place in all of our lives about what it means to communicate in the 21st Century,"
This revolution in communication has accelerated at remarkable speed. The same Media in Mind report found while in 2007, 5% of all Americans were publishing a blog, as of 2008, 10% were. The same doublings occurred in the 18-34 year olds with the rate going from 10% to 20%.
The readership has soared also. We all know that to one degree or another, but what's interesting is the reason that UM figured on:
"We think that's due to the increased use of social networking, and blogs are an integral part of using them. Two years ago, asking people about blogs, people were shaking their heads. I think now it's taking off because social networks are taking off. RSS feeds, which make reading blogs easier, have become an integral part of the way people communicate and exchange content. People may have been doing it before, but may not have realized it. Now they're recognizing it for what it is."
The revolution in customer engagement and CRM 2.0 starts with the revolution in the use of social media.
(1)Social Media….
Publishers always want text to fill in the space between headers. I find that a strange and kind of useless convention so consider this minor diatribe as me acceding to the convention. Now to the real stuff.
(2) in General
What am I calling social media? It varies really.
Some of the social media are tools, like blogs, wikis, podcast and podcasts. Some of the social media are based in user generated content (UGC) such as comments, reviews, social tags, social bookmarks, comments, rankings, ratings and photos, and videos. There are sophisticated uses of some of them such as the use of social tags for the creation of folksonomies - organic tag groups to simplify it. In fact, at the end of this chapter, one of the people waiting to talk with you is Thomas Vander Wal someone you could easily call the inventor of folksonomies and social tagging.
In early 2008, Forrester Research did a study of 333 interactive marketers of either midsize or large corporations on their interactive spending levels for 2008 despite poor economic conditions. The results are telling:
- Increase investment in social networks - 48%
- Increase investment in user generated content - 42%
- Increase investment in email marketing - 41%
- Increase investment in blogging - 40%
- Increase investment in search marketing - 38%
Yet only 10% are increasing spending on display ads and 40% will cut back spending on the same.
You could infer from this data that we are in the somewhat early stages of an exodus from the world of traditional marketing - and to some extent you'd be right. But don't fall for the trap here. This doesn't mean much more than companies are becoming aware that they have to change how they are interacting with customers. They aren't necessarily doing it.
In fact, most of them aren't doing it, even if they're considering what their options are. Kathleen Reidy of the technology analyst firm, the 451 Group, released a study at the end of May 2008, that had polled 2081 IT and business professionals and found that when it came to the use of social media (which they defined for the purposes of the report as blogs, wikis, and social networks) only 24 percent of the respondents were using the social software needed to build or use those communications media.
But then there's this third study. In Feb 2008, IDC found that 14% of all the enterprises polled already had social networks and by year end, that number was expected to be an inverse 41% - meaning that white label private label social networks (and communities) entered the mainstream.
So who do you believe?
All of them and none of them. First, don't be fooled by the 451 Group number. If 24% were using social media that's about 24% more than were three years ago. If 41% do have social networks by the end of this year, than that is a 300% increase within the year itself. The Forrester Research indicates a willingness to keep spending on it - except for IT departments.
(2) in Brief…..
I'm going to handhold you through this chapter. These social tools, technologies, and features can be confusing and are not at all clearly a part of a traditional CRM strategy. Of course, we're not talking about a traditional CRM strategy in this book, so that's understandable.
In this specific section, I'm going to give you a brief business definition, just mention some of the best tools available for the specific media and give you a short use case for CRM 2.0 which is referred to as CRM from here on. Traditional CRM will be called something like that or CRM 1.0. (I'm making the shift. So should you). Following that, a short table on the upside and the downside of using the tools. The idea is to get acquainted with these tools. The social tools most important for CRM have their own chapters in the book i.e. blogs, wikis and social networks but by the end of this chapter you'll have at least enough of acquaintance with them to incorporate them into your engagement strategy.
One reminder before I do this. These are tools. They are not substitutes for engagements with customers, they are not substitutes for strategy, they have their own benefits and problems and they should be used judiciously and not because they are there or are cool.
You think that's ridiculous? A little history, maestro. Play that funky music, tech boy.
The biggest battle those of us immersed in the world of CRM have had to fight was with our clients. Why? Because the vast majority, without a scintilla of exaggeration or irony, saw and still see CRM as a technology. Despite the protestations by many that CRM was a strategy that was enabled by technology, the myth of "CRM the technology" persisted to the point that practitioners would cripple themselves by implementing CRM before they even had a plan for their customers.
In retrospect, part of the problem was that despite all the protestations of the industry, for the most part it consists of software and SaaS vendors - and they wanted to (and want to) sell their products and services to their customers. As the good old Edelman Trust Barometer for 2008 indicated, they are also in the most trusted industry of all - high tech. So even when the vendors would say "CRM is not about software; it's all about people," let's just say they weren't trying to sell you people the following morning.
Do you think that mindset has changed much in the past three years? Nope. Not a bit. Realistically, the inclination businesses have is to throw tools and technology at what are human issues and hope they automate the issues out of existence.
Notwithstanding, there is a growing recognition that beneficial customer interactions are governed by trust, transparency and personalized experiences. Four years ago, the answer was thrown sales, marketing and customer service applications at the interactions. Now the answer seems to be that you should throw blogs, wikis and social networks at the interactions - perhaps with some sales, marketing and customer service applications.
This is once again, the wrong approach.
Take my advice, please. These are tools that are meant to be used as enablers, not drivers and more to the point, not substitutes for anything at all, except maybe sugar.
The inclination to use the tools is going to be because:
- Everyone else is.
- They are really cool and fun to play with.
- As drivers, they are an apparently easy out for developing a customer engagement strategy. Truly, that thinking will cost you big time.
Pretty much like everything else in life, if the tools have real value, then they are worth using. Not that complicated, really. For example, if your customers are senior citizens over 75, it is likely those tools would be a useless addition to your engagement arsenal, no matter how much fun they might be for you to play with.
Now, grab my hand and let's start walking.
THE END. See you at Gartner.
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