The Importance of Social CRM Businesses

What is the first place potential customers go when they first hear about a new product? Google? Facebook? They see what’s being said about the product and company, if any of their “friends” know about it (or, more to the point, “like” it), and find reviews in various online media outlets. Depending on the product or service, they might even take to Amazon or Angie’s List to see what other people think. They might even visit the company’s website.

They don’t go visit a brick and mortar store. They don’t wait for a telemarketer to call them with an offer they can’t refuse. They fast-forwarded through the commercial about it on their DVRs. They flipped past the full-page ad about it as they perused a magazine on their iPads. The email blast about it went into their spam folders.

Bottom line? Social media has changed everything for consumers and even for businesses making purchasing and contracting decisions.

For businesses, social media falls somewhere between art and voodoo. Those that do it well reap significant benefits at lower costs than could ever be expected with traditional approaches. Those that do it poorly see their competitive advantage slipping away because they just don’t get it. They haven’t moved on with the rest of the billion people on Facebook.

It takes more than a Facebook page with a few thousand likes to qualify a company as being engaged with customers through social media. The key here is conversation. Social media were never meant to be one-way broadcast tools. Sitting at a conference listening to a lecture is not social and neither is reading a company’s Twitter feed announcing their latest product updates or blog entries. Sitting around a table at a dinner party, on the other hand, is social. The same goes for an ongoing conversation with a growing community of users and potential customers, even if they’ve never met face-to-face and are only connected through a social medium.

Traditional marketing campaigns focus on this one-way broadcast approach. TV commercials, print ads, press releases, radio spots—all are designed to talk to a wide swath of potential customers. Social campaigns, on the other hand, leverage existing communities of like-minded individuals or businesses and use social media to both expand and engage with those communities with the ultimate goal of lead generation and sales conversions. This can become an arduous process of so-called “lead nurturing”, but, if done successfully, can reduce marketing costs and increase sales because marketing activities are directed at people who are actually listening. The same can’t be said of expensive television ads that people either ignore or skip.

CRM stands for Customer Relationship Management. Yet that word “Relationship” comes into laser focus when businesses seek out robust, authentic interactions with customers via the social Web.

This sort of engagement, though, can be labor-intensive, just as direct sales models have always been. And, just as traditional software revolutionized, modernized, and helped scale traditional sales and marketing, so too can social CRM and customer intelligence help manage social media marketing, community development, and customer conversations.

Managing the social presence of an organization could be handled by simply throwing manpower at the various networks and communities with which a company needs to engage. However, at scale (and, in reality, the Internet brings everything to scale very quickly), this would become prohibitively expensive. It also becomes increasingly difficult to manage an organization’s message and analyze the data and information flowing from social channels. Social CRM helps organizations of any size scale their conversations and, more importantly, drive product, marketing, and sales strategies with objective data. Applying analytics to something as subjective as social media is no small task but the right software can make it much easier.

Social CRM, whether viewed as customer relationship management centered around social media and customer intelligence or as a social-enabled collaboration engine for businesses to improve team performance, is one of the most important trends in sales and marketing. In the 21st century, social channels are essential to both customer acquisition and retention, while business platforms are increasingly adopting social paradigms to improve productivity and break down organizational silos.