Social CRM Showdown

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NEW YORK — The final day of the CRM Evolution conference provided nothing short of conversation. Two separate — yet overlying — panel sessions broached the subject of social CRM, addressing questions such as, What is it? How far along are we? And where are we going? 

Forrester analyst Dr. Natalie Petouhoff seemed to sum it up fairly: "It's a really confusing, growing landscape," she said. Social media's impact on CRM may be a confusing topic, but it's certainly one that gets people talking. Petouhoff shared her views during the morning panel alongside IDC analyst Michael Fauscette and Dr. Osamuyimen Stewart, research staff member with IBM Research. The topic of discussion swayed toward the implications of social media on the enterprise.

"One of the outliers is, 'Is there an ROI?'" Petouhoff said. The researcher of social media customer service conveyed that she often hears from clients that if there's not a business case, in this economic climate, they can't approve anything. Petouhoff encouraged businesspeople to push the case for social CRM. "If you have one initiative in customer service, it should be social media," she said. 

According to Petouhoff and Forrester Research, the ROI for customer service communities is close to 100 percent in fewer than 12 months. Despite that high turnaround, enterprises are still hesitant to embrace social tools. Putting herself in a customer service manager's shoes, Petouhoff said, "We already had too many channels to begin with - and we weren't very good at them — and now we are adding another channel." It can be overwhelming, but organizations need to start pushing for executive buy-in for social projects.

IBM's Stewart said that applying social tools within the enterprise has a different flavor and requires a different strategy. Stewart said to drive adoption of enterprise social networking initiatives, businesses must consider both user design and incentives. He added that finding the right "social objects" that employees enjoy using is crucial. He took attendees through several internal IBM projects that used enterprise crowdsourcing for content and creation. The biggest lesson, Stewart said, was to see beyond the hype. "Crowds enjoy hype," Stewart said. "Hype does not sustain participation."

Fauscette brought a slightly different vibe to the morning panel. "Looking at things from the enterprise [perspective], I hear people talk about social media, social networking ... and Twitter, but I don't think it's about any of those things," he said. "What happened was this enablement of conversation online and building trust and relationships online in the personal consumer space. [Those] things started to flow into — rather, flow up — in the business." All of these forces, Fauscette argued, are being pushed into the enterprise, but he still maintained his point that Twitter isn't a solution for the enterprise. "I don't know how it scales from customer service perspective," Fauscette said, pointing out that contact centers adding agents to moderate Twitter isn't a pragmatic strategy. So, what's the solution for the enterprise? Fauscette said that he thinks it's yet to be discovered. 

Beyond the technology adoption, Fauscette and the other panelists seemed to come together on one notion — social CRM won't happen without change management. "We will continue to use Facebook and Twitter ... but those are just enablers and have nothing to do with the culture to make this work," Fauscette said. 

The CRM Evolution closing keynote featured a panel discussion from another round of forward thinkers in the realm of social media. Denis Pombriant, principal and founder of Beagle Research joined Clara Shih, the founder of social media marketing company Hearsay Labs, and Marshall Lager, founder and principal of Third Idea Consulting on stage for additional conversation on all things social CRM. 

Pombriant started the discussion off by noting that we — CRM Evolution attendees and you, the reader of this article — may very well be the forward thinkers on social CRM. "The rest of the world isn't necessarily thinking like us," he said, adding that recent books such The Future of the Internet - And How to Stop It prove that we still have a long way to go. "It really still is in the early days," Lager said. "Despite the fact that one can argue that social CRM started when Amazon started allowing customer reviews ... we still haven't gotten a whole lot further than that." He added that although CRM vendors seem to be picking up pace with adopting social solutions and tools, automation remains fairly immature and passive -- and in most cases, still needs a human behind it to glean any real value.

"We have a long way to go, but we are already seeing progress in certain areas," said Shih, the developer of Faceconnector (formerly known as Faceforce), a program that integrates Facebook and Salesforce.com CRM. Shih went on to mention Petouhoff's promising research on demonstrating the ROI for social media in customer service. She also noted, in particular, the immense growth on Facebook — now more than 250 members. "It's becoming the new Internet portal," Shih said. In addition to critical mass, Shih said that there's huge opportunity on the site — relevant targeting being one of them. In talking about search engine marketing, she pointed out that Google took us far in terms of learning where customers where coming from and what their intended searches were. "The one question we could never answer was the 'Who,'" Shih said. "With Facebook [we] share so much rich information about ourselves. All this information ... is available [with the consumer's permission] to advertisers." She adds that when a consumer sees an ad and it's relevant, it no longer feels like advertising. 

Pombriant pointed out, however, that with social networks, the relationship between business and consumer is largely opt-in. "With this technology, nobody has to be in a relationship that they don't want to be in," he said. "The people on the [receiving] end ... don't have to receive a [message] if they don't want to. If they do, it's because they value the thought leadership." Pombriant stated that we are to the point where we won't buy anything from anyone we don't respect.

Seeing things from the consumer lens may be easier than taking on the business role. The panelists all seem to align on the thought that an organization trying to dive into social networking conversations without a strategy or understanding of the space is a bad idea. "One of the issues we have in social CRM is a rush to elaborate — a rush to get into Facebook ... Twitter, blogging — before we necessarily have anything to say," Pombriant said pointedly. In other words, it boils down to understanding before being understood. A lot of that understanding means tuning into customers before taking action. "It seems that customer input is one of the last things we think about when thinking about social media and social networking. And it really should be the first thing," Pombriant said. 

Fauscette made a similar point in the earlier session: "We've got to stand back and figure out where were going before we get there," he said. "We have to ... think about the business strategy and the change management - that all has to happen." Change is occurring outside the enterprise whether businesses decide to embrace it or not. Petouhoff took a stab at summing it up: "Customer disdain, social media, and customer service ... have formed a perfect storm that is super charging change," she said.  

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CRM Evolution '09 concluded earlier this week in New York. Full coverage can be found here.

News relevant to the customer relationship management industry is posted several times a day on destinationCRM.com, in addition to the news section Insight that appears every month in the pages of CRM magazine. You may leave a public comment regarding this article by clicking on "Comments" at the top; to contact the editors, please email editor@destinationCRM.com.

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