For Social Success, Build a Business Use Case

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Despite Gartner's prediction that the market for social CRM software licenses will total $2.1 billion this year, it's estimated that only 50 percent of Fortune 1000 companies that implement a social CRM initiative will notice a measurable return on investment by the end of this year.

Why? According to Adam Sarner, research director at Gartner, some companies are not even measuring ROI at all. When surveying enterprise and midsized companies using social CRM applications, Sarner found that many of those not measuring ROI said "it was either too hard, too early, or they weren't asked" to do so.

"Most of the projects I've seen either have an imbalance of purpose or no purpose," Sarner says. "Either it's too much about the business saying, 'Hey, be social with us' and people saying, 'What's in it for me?' or it's too much about the customer or even the employee, where they're having a great time but there's no business value."

The companies that will be the most successful at social CRM are those that can tie their social objectives to clear, measurable business goals. Three-quarters of new social CRM initiatives that receive funding by the end of 2012 will have some semblance of a business case incorporating measurable ROI, Sarner says.

The companies that can expect the greatest return are the ones that will make progress in two or more areas.

Marketers traditionally held the purchasing power in early adoption of social CRM solutions, but the purpose for deployment centered on "softer metrics," such as brand engagement, according to Sarner.

"To this day, marketers are the biggest adopters of social CRM technologies, followed by IT," Sarner maintains. "The next user…is customer service, because there tend to be more metrics. There's 'How quickly can you turn around a customer inquiry?' and 'How do you turn 18,000 calls a day…to 16,000?'" As a result, vendors are attuning themselves to customer service processes to account for the harder variables of ROI.

B2B lead management, Sarner says, is a nascent area in social CRM deployment and is poised for growth because of its inherent measurability. Companies that append social leads might begin to measure how that contributes to a more qualified lead, cuts down on lead time, and contributes to the greater success of a sales cycle. Sarner estimates that B2B applications for sales use will experience the fastest growth, accounting for 30 percent of social CRM spending by 2015. That's up 5 percent from 2011.

To accommodate new social CRM use cases, vendors must tie pitches to quantifiable results. While unique functions, analytics, ease of use, and an excellent user experience differentiate a product, those that hold a competitive advantage will demonstrate quantified business cases and deliver repeatable social CRM processes, Sarner says.

Companies that want to implement a social CRM solution and incur measurable ROI numbers must focus on the business purpose. "That's when you can make the technology make sense," Sarner says. "Otherwise, it just remains in this giant blob of stuff that adds to the confusion."

Instead of merely eyeing an improvement in "efficiency," companies must ask, "What is this actually making better?" Sarner adds: "How does a marketer discover what the new black is next season three months ahead of the competition using social data? That, to me, is a direction."

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