Service and Social Media: You’re Not Social (Enough)

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For the rest of the June 2009 issue of CRM magazine — The Social Media Issue — please click here.

Sam Hunter can’t point to a defining moment that convinced him of the power of a user community—but there’s no denying that power today, he says. As the senior vice president and general manager of Act! by Sage for North America, Hunter says his team had long considered the notion of community, but it took a series of events to finally prompt the company to jump into the social networking world.

“We have a large customer base, and they like to discuss what products work for them, and ask questions about how to do certain functions [with our solutions],” he says. “We figured it would be nice if we had some way of creating a single forum where they could do all of that and enable the conversations to take place.”

The vendor turned to Emeryville, Calif.–based forum builder Lithium Technologies to create the Act! by Sage Community for its consultants, customers, developers, and employees. Just a year later, the company was on the receiving end of a 15-point boost in customer loyalty, a 300 percent increase in beta-program participants, and more than 8 million page views. Hunter says he can’t imagine ever turning back. The community, he says, “opens communication and exposure to many topics, and it just really creates a great dialogue both with and among customers,” he says.

Welcome to social service, in which today’s consumers increasingly turn to each other and the Internet in all its forms—blogs, communities, Facebook, forums, LinkedIn, MySpace, Twitter, wikis, and more—to connect and find information. Deloitte Consulting predicts technology providers and carriers could spend up to $500 million this year on social networking solutions. Furthermore, in the past year global social networks have enjoyed a 25 percent increase in unique visitors. Combine this with trends cited by a recent Datamonitor study—the struggling economy and difficulty in new-customer acquisition—and the time seems ripe for technological advances in customer service.

“The customer is in charge of the process now,” says Anthony Nemelka, chief executive officer of Helpstream, a Mountain View, Calif.–based on-demand social CRM provider. “It’s not about managing customer relationships but rather serving the consumer. The term we use, ‘contact center,’ is really becoming a misnomer for a lot of organizations because agents and service representatives are engaging the customer on their terms.” (Helpstream was recently named one of CRM magazine’s Rising Stars; see our profile of the company in the April 2009 awards issue.)

Bob Peery, director of knowledge base product management at on-demand CRM company nGenera, believes this is no different than any other technological advance the CRM space has seen in the past. “It’s exactly the same kind of metamorphosis that happens whenever a technology that has such huge social implications surfaces,” he says, citing the telegraph, the telephone, and the Internet as game-changing examples.

Regardless of history, says Natalie Petouhoff, a senior analyst with Forrester Research, companies afraid to jump headfirst into the social world now risk becoming part of it—for all the wrong reasons. “A lot more will happen a year from now than three or even five years,” she declares. “I’m flabbergasted by how many companies are already doing this.”

As with any new technological iteration, questions still remain as to what social service is today, much less in three to five years. However it develops, there’s little doubt that social service is here to stay.

When it comes to deploying forums, it’s the simple, small things that count. Customers want two things out of online forums, argues Dan Ziman, director of marketing programs for Lithium: instant gratification and proof that companies are actually using their commentary. “It’s just basics,” he insists. “Saying, ‘Hey, that was a great comment and we’re looking into it’ can work. But you have to get back and show you’re making changes, otherwise you’ll see the community start dying off.”

Petouhoff explains that deploying communities is actually different than most technical applications generally utilized by enterprises. In the case of these forums, the focus is on the customers; executives speak directly to them. Strategy and management take higher precedence than the technology itself—the historical downfall of many CRM implementations. Petouhoff also stresses the sheer effectiveness of collaboration, the sense of belonging to and being part of a community, and making a difference by sharing regardless of the level at which it occurs. “There are three tiers of sharing,” she says. “[First,] peer-to-peer—company-sponsored or not. The second tier is where the company is watching and maybe responding to the peer-to-peer communications, while the final one is full-on via CEO postings, monitoring, and knowing when and how they need to respond.”

Just because the technical application of community forums may be shifting doesn’t mean that best practices are thrown out the window, argues Adam Sarner, principal research analyst at Gartner. Unless clear expectations, ground rules, and mutual purpose are established before the community’s launch, he says, it will ultimately fail.

“People don’t mind ground rules because they need a purpose [for] why they’re there,” Sarner says. “Establishing [guidelines] and guardrails—basically spelling out what the company wants from customers and what they’ll get in return—streamlines the conversation so there’s no blow-up and mismatch of expectations.” No one says those rules have to be set in stone immediately, though. “Defining this mutual purpose and having a balance is lesson number one,” Sarner says. “Even if it’s not perfect what the purpose is, it can develop over time.”

Once customers know what they’re getting themselves into with a community forum, it’s your turn: Taking customer information and acting upon it—and showing this action to the customers—is extremely important.
Lithium’s Ziman says that many of his clients establish a social media committee to address issues raised in the forum. “Even if they meet only once a month, they can go over some of the information, engage people online, and foster that idea exchange,” he says. “Take the feedback coming in and embrace it.”

The Act! by Sage Community knows that firsthand. According to Kim Josephs, Sage’s director of online communities, the insights gained provide a fantastic learning opportunity for all of the Act! community members—consultants, customers, developers, and executives. “There’s also a big benefit in rolling information into areas where it can really help foster product improvement,” she says. “Product management teams are very involved, and take the ideas and really put them to the test.” (See “Social Support for Software,” Insight; and Connect, April 2009, for more on the Act! by Sage Community and other vendor-sponsored social networks.)

Helpstream’s Nemelka says the customer service forum is useless if it’s not intertwined with the everyday processes of contact center agents. He stresses the importance of ensuring that customer service representatives (CSRs) have a desktop of applications with easy access to the online community. Also critical: “The data must be captured about the user in online communities and integrated with a back-end CRM system,” he says. “So when you’re collaborating with Joe Smith who just raised an issue in the online community, you have at your fingertips all the information about him and can really be responsive and attentive to him.”

That integration also must connect customers and CSRs to the increasing number of social technologies that can be deployed on a company’s Web site. “Being able to have people on the service desk and contact center area with Twitter profiles so they can monitor information in that channel is important,” Nemelka says. “At the end of the day, it’s about integrating into business practices and modifying [them] to make [them] embrace these social technologies, never putting up a wall.”

Peery, of nGenera, believes it’s something that will come—in time. “Companies are putting more pressure on us to put social enablers in there so that they can provide dot-com presence in a mobile format or even enable an online chat via mobile phone,” he says. “They’ll continue to force software vendors to adapt to software in place today so they can be more social-service friendly.”

What about beyond the realm of service? The idea is that CRM today should have already broken the silos barricading customer service, marketing, and sales. With the introduction of social technology—and the feedback received—companies now must be able to spread the wealth. One method could involve internal customer-advocacy groups, taking one person from each department. Datamonitor Associate Analyst Aphrodite Brinsmead suggests in a research note that there is great opportunity for customer experience analysis vendors, including ClickFox, SAS, and SPSS, to “find ways to use the information from social networking to help enterprises understand and analyze data from customers.”

Olivier Jouve, vice president of corporate development at Chicago-based SPSS, says that it isn’t as easy as one may think. “Companies need sophisticated Web-scraping technology to extract interactions between people in a social network,” he says. “If you’re a worldwide company…and need to understand feedback from customers in Japan, Europe, Africa, South America, and so on, you need to understand the different languages and extract sentiments, which of course integrates new complexity in what you’re doing.”

Being able to gather these insights adds another arrow to a business’ quiver, Jouve argues. “It’s not just what you say but also what you are,” he says. “We’re talking about insights, the need to integrate to make decisions, and combine all of the information to provide a full view of the customer.” The ideal, he says, is to “gather all the information possible about customers, be it their attitudes, behaviors, and everything they say.”

Joe Outlaw, principal analyst at research firm Frost & Sullivan, believes that loyalty forums are synergistic with customer service and contact center functions—but are not working together yet. “We do see loyalty forums growing quickly,” he admits. “Those are more linked to the marketing and sales parts of organizations.”

He explains that companies and vendors alike recognize the need to make these forums work seamlessly with more-formal customer service applications. “I wouldn’t be surprised to see companies like Aspect [Software], Avaya, Genesys [Telecommunications Laboratories], and Nortel [Networks] feel as though they need this as part of an overall offering,” Outlaw says, though that might mean a proprietary offering, a partnership with other vendors, or even an original-equipment manufacturer agreement.

Petouhoff says breaking down silos isn’t automated, but it should be. “Right now, most companies I’m talking to have a list of most important posts from each day, and they use that as part of a weekly meeting at a high level,” she says. “That way, product engineering, manufacturing, and quality assurance get to hear what’s happening in the company and what customers are saying, so they can try and fix it. It’s not automated yet, though, which is really key because of the kind of rich information you can get.” She cites Dell Ideastorm and My Starbucks Ideas—community-innovation sites running on Salesforce.com solutions—as “real examples of how communities are making a company more transparent and authentic.”

The customer service upside of an online community is clear. According to Outlaw, an immediate advantage is consumers can help each other with questions, delivering cost savings by reducing the number of inquiry calls the formal contact center has to take. “There’s also the faster creation of growth of knowledge bases as people solve each other’s problems,” he says. “Companies can capture and put the information into the overall knowledge base. More people are smarter than one, and you can grow a [knowledge base] faster than you could if the company went about doing so on its own.”

He continues, “There is a scenario in which…a very active forum…sucks up other channel requirements as far as customer contact, like chat and live agents. It’s very interesting.”

Petouhoff sees communities finally fulfilling the promise of self-service in the contact center. “It actually works,” she says. “Integrating this into contact centers by taking internal Web agents and seeing FAQs, knowledge bases, and answers in the forum…makes them smarter [and] more productive, and reduces stress.” She also sees call deflection as another avenue for direct savings in the contact center, but says there’s an opportunity to utilize it for more than just that.

Josephs explains that when the beta of Act! by Sage 2009 was shared with the community, the vendor was able to glean which features customers truly wanted. “By running the beta in that forum, our engineering and product marketing executives were moderators and able to cull feedback quickly as opposed to the traditional four-week beta cycle,” she says. Call deflection was another thought, but a concern was contact center calls were a service customers paid for, that Sage would lose money. However, the opposite turned out to be true. “It’s allowed our support team to offer higher-value services in addition to self-service in the community,” Hunter says. “Honestly, we don’t want customers paying for simple answers.”

Nemelka bristles at the mention of call deflection. “We wear ‘no deflection’ pins,” he says. “[Deflection] has been a mantra for contact center operations for a long time, and it needs to go away.”

Perhaps, but it may first need to be replaced with another hard-number metric. Peery, of nGenera, believes that anyone considering social technologies will need hard numbers to convince their companies to invest. “You still need tangible ROI that is tied to tactical and operational expenses,” he says. “It’s a backward approach…. You have to save me money first and reduce maintenance costs before we realize the soft benefits. That’s why I think three to five years is a good estimation of how long it’ll take to really take hold.”

The future of social service can be difficult to discern, especially when many companies are still in the nascent stages of incorporating Web 2.0 and social networking. Nemelka believes we are on the cusp of a revolution in customer service, one that breaks down barriers that have traditionally separated companies from customers—and customers from each other.

“People in contact center management [are] really embracing this idea of being a community manager [as] a new job description,” Nemelka says. “For the people who’ve made that transition from being ‘just’ a service rep, it’s not just another path but one that’s more rewarding [with] more exposure in an organization.”

Why? Because the issues that are coming up in communities are more substantive, Nemelka argues. “[They] need the attention of the head of marketing, training, you name it,” he says. “The community manager, in essence, identifies and escalates to various people in the company. The contact center itself becomes more core and central to the customer satisfaction experience rather than a peripheral act when products aren’t working right.”

The new, more-influential posts can end up attracting the most unorthodox of employees. “The really interesting thing we’re finding is that it’s not a title-based [phenomenon],” Lithium’s Ziman says. “It can be the receptionist who is 23 years old and happens to be one of the most-active bloggers or twitterers. She could know nothing about the value of customers or profit/loss, but she can engage people on the Internet and bring them in.”

Shifting requirements, Peery says, could lead to a mass exodus of CSRs either unwilling or unequipped to handle the new, socially connected contact center. “A portion of the people they currently have in their contact centers are going to have to find new jobs because they can’t do it…. Their brains aren’t wired that way,” he says. “It’s really hard for CSR vets to do two or three chats, maybe work in a couple of emails, and the phones. I think that’s why the concept of a ‘Super Rep’ has never really taken off.”

The nearest we’ll get to that mythical Super Rep, Peery argues, is among younger workers accustomed to multitasking and intimately familiar with Web 2.0 technologies. That, however, requires a change in performance management. “Swapping out the human resources that have the ability to do that…will only become effective when the younger generation feels its value is recognized correctly,” he says. “It goes back to a mentality on how to track and evaluate performance. It’s not as easy as average handling time and work mode anymore.”

As Sage continues on its path toward social service, Hunter says he expects various tools to emerge to help further engage with the community. Regardless of what those tools end up looking like, however, he says the emphasis must always remain on community. Many companies are tempted to try new technologies for the sake of being blindly ahead of the curve. (See this month's Re:Tooling, page 49, for social software best practices that are anything but blind.) Hunter, though, says he’s determined to take things one step—one discussion-board posting—at a time.

“For us, the community was such a redefining moment because [we] invested a lot of time and effort to make sure we launched successfully, so we’re not going to spread ourselves thin,” he says. “You’re going to see a lot of tools become more prominent in all aspects of the business. But for right now, from a service perspective, we see the community as the right one to have in place.”


SIDEBAR: The Social Definition of Multichannel

In a Datamonitor research report earlier this year, “Twitter and Google as Customer Service Tools,” Associate Analyst Aphrodite Brinsmead wrote about the emerging multichannel contact center. Incorporating email, SMS, interactive voice response, and instant messaging—in addition to the traditional live-agent channel—the new-age center also includes Web 2.0 technologies such as blogs, social networking, forums, and search engines to share information.

While the new technology has great potential, Neal Keene, vice president of industry solutions for United Kingdom–based multichannel solutions provider Thunderhead, explains that those focused on the latest and greatest in social technology are missing the big picture. “Social networking is only one component; every channel must have consistency,” he says. “One of the things we’re focused in on from a strategy standpoint is how to have information centralized from social communities, but also email and [other channels], so the CRM platform knows everything about your customers. That way, you can have personalized communication with people no matter what their preferred channel may be.”

Keene goes on to explain that despite the mainstream media’s fixation on social networking, there still needs to be a clear business plan for companies to take it on successfully, as well as the infrastructure to support it. The upshot? Don’t put the cart before your technological pony. “The challenge organizations will continue to face is supporting all the traditional channels as well as the social ones,” he says. “Many haven’t focused on combining their strategy around communication.”

That’s not to say companies won’t get their acts together soon, though. Keene is optimistic that planning will shine through as more organizations want to track conversation histories across all channels to better service consumers. “Then, when someone calls the contact center, [the agent] can see what the last communication was about,” he says. “That’s what’s missing on a lot of interactions…not only communicating through social [networks], but [having] the history to be more effective on the next conversation, no matter what channel it is.”


SIDEBAR: B2B versus B2C
The idea of social service naturally lends itself to the mainstream consumer—a 54-year-old man trying to set up a new computer, or an 18-year-old high school senior looking to buy her first car. As a result, B2B companies often seem to get overlooked in the discussion of social media, despite the prevalence of B2B buyers in many forums.

“Some of the larger communities are more B2C oriented, but that’s the nature of the beast,” says Dan Ziman, director of marketing programs for Emeryville, Calif.–based forum provider Lithium Technologies, adding that
60 percent of his company’s customer base is B2C while the remaining 40 percent are B2B. “The challenge on the B2B side was whether to make them open or closed forums.”

Ziman says open communities are “far more active” than closed ones—a double-edged sword in B2B. “The difficulty is that people like being in the community…but if they join [it] for free, it could hurt support-maintenance revenues. Support is the basis of how a lot of B2B technology is sold.”

Anthony Nemelka, chief executive officer of Mountain View, Calif.–based on-demand social CRM provider Helpstream, believes that the difference between the two is not in the social technology itself but rather in the issues tackled. “Adoption is not different among B2B and B2C companies out there—that‘s driven by the customer demographics,” he says, adding that in B2B community forums, a larger proportion of community managers are actually company employees, while in B2C the strong customer advocates are actually consumers who can then serve themselves effectively. “There is not as much moderation in B2C forums,” he says.

On the other hand, says Natalie Petouhoff, senior analyst at Forrester Research, there’s very little difference between what B2Bs and B2Cs hope to accomplish with online communities. “They are pretty similar,” she says, “in that questions still need to be answered, whether that’s an internal forum in which employees are helping fellow colleagues or between businesses.”

Bob Peery, director of knowledge base product management at Austin, Texas–based on-demand CRM company nGenera, takes a different view. He rejects the B2B/B2C alphabet soup, preferring to place his bet on demographics making the difference. You can primarily thank the members of Generation Y for the adoption of communities and forums, he says, because they’re the ones who are most accustomed to utilizing social networking technologies for collaboration. “The younger generation is…obviously driving all of this,” Peery insists. “There are a lot of companies trying to come up with that killer app. The only reason that it’s still slow is because there are so many people like me, in their 40s, [who] at the end of the day are more comfortable with email [instead of text messages] when handling a customer service issue.”

Contact Assistant Editor Christopher Musico at cmusico@destinationCRM.com.

Every month, CRM magazine covers the customer relationship management industry and beyond. To subscribe, please visit http://www.destinationcrm.com/subscribe/.

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