Blog reference: At this point I invite you to read the attached white paper, which covers additional benefits and implementation stages for using SCRM to build a competitive advantage. FYI, I helped develop this whitepaper for my client Morley (www.morleynet.com), a great partner for managing contact centers as they do so for several Fortune 500 companies.
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Morley using social crm to build competitive advantage
1. Interactive
Using Social CRM to Build Competitive Advantage
Imagine a company that can interact with a consumer across multiple brands and touch
points, understand the interests, passions and preferences of that consumer, and provide
the consumer with relevant experiences at his/her preferred touch point(s).
Developing this capability into a global center of excellence requires establishing a
consumer relations communications hub that can identify individual consumers and
manage these interactions across its touch points. It also requires a shift from “inside
out” communication and processes to “outside in,” where the consumer is not only a
user of the product, but also its developer, salesperson and publicist.
Driving Consumer Value
In their book Strategy From the Outside In: service offerings for each individual
Profiting From Customer Value (July 2010), consumer. By 1998 Pine and Gilmore
professors George Day of the Wharton welcomed us to the “experience
School and Christine Moorman of the economy” and told us that we could drive
Fuqua School challenge companies consumer satisfaction by creating unique
to create consumer value by standing experiences, many of which were made
in the consumer’s shoes and viewing possible by mass customization.
everything the company does through
As consumer satisfaction and mass
the consumer’s eyes. They believe that
customization merged, Customer
consumer value is driven by a company’s
Relationship Management (CRM) was
ability to engage in a collaborative
born. We now had a systematic approach
conversation with the consumer.
to building the value of a consumer by
Social media and social networking are listening to and recording the consumer’s
creating the opportunity for an increasingly preferences in order to produce a product
direct dialog with consumers. Facilitating specific to the consumer’s needs. However,
these conversations requires identifying this approach was too often practiced as a
consumers and their experiences across data-driven efficiency exercise where the
internal and external touch points, and company makes the rules and defines
then making each engagement relevant to the channels of communication.
each consumer. This is all made possible
Enter the era of social media and the
through Social CRM.
birth of the online “community.” MySpace
How Did We Get Here? (2003), Facebook (2004), Twitter (2006),
Foursquare (2009) and the personal
Ever since Xerox discovered that its
blog have all contributed to encouraging
“completely satisfied” consumers were
the never-ending flow of personal
six times more likely to repurchase than its
information now available for those who
merely “satisfied” consumers, companies
care to listen. Today’s consumers are
have sought to understand the connection
blogging, posting, tweeting, checking
between consumer satisfaction and loyalty.
in and crowd sourcing in a deliberate
About the same time, in 1992, Joe Pine effort to broadcast their interests to an
introduced us to “mass customization” ever-growing constituency of fans.
and asked us to think about using
computers to customize product and
Moving People to Move Mountains®
2. CRM TRANSITIONS TO Social CRM
The company (sales and accounting) The global online community that expresses
Who and its customers. an interest in the company or its products.
The company creates customer
What service processes. The company supports its social community.
When The company operates on its
timetable during business hours.
The company operates on the
community’s timetable – 24/7.
Where The company has pre-defined
channels to address customer needs.
The company is fluid and communicates
through the community’s preferred channels.
Why The company focuses on
transactions as the KPI.
The company focuses on community
relationship building as the KPI.
The company sees things from the The company sees things from the outside
How inside out and interacts with customers in and lets the community’s perspective
based on company needs. guide its interactions.
Social CRM is the real-time art of listening What has changed is the environment for
to this constantly growing community, achieving these goals. Through the use
recording their interests, passions and of Social CRM, companies can engage
preferences, and engaging with them directly with their consumers and better
on their terms. In this new paradigm, understand and record their interests,
the consumer makes the rules, defines passions and preferences.
the channels and leads a collaborative
Social consumers can become truly
discussion regarding the goods and
collaborative partners helping to build and
services they desire.
deliver better products and services. This
How Is the Current deeper engagement drives loyalty, thus
Environment Different? strengthening ties with your brand and
increasing your competitive advantage.
While it is easy to be overwhelmed
Further, as Social CRM extends its reach,
by this flood of information, focused
local engagements help build the global
companies are still asking the “outside in”
community, and access to a global
question: “How can I completely satisfy
community helps bring innovation and
my consumer and develop an evangelist
information to local markets.
that will carry my message to other
consumers?” The answers are largely
the same: “…the consumer makes the rules,
• Create a great product. defines the channels and leads a
• Surround it with relevant services. collaborative discussion regarding
• Have a plan for fantastic service the goods and services they desire.”
recovery.
• Provide the additional intangibles that
set you apart.
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3. The Story of Julie Jones
CRM
Imagine that Julie Jones, consumer of newspapers, buys an online subscription to
The Wall Street Journal (WSJ). In the process of signing up for the paper, she gives
her basic demographic information. The WSJ now knows her name, that she lives
in Ridgefield, Connecticut, and that she works at General Electric. This last piece of
information was optional, but Julie wanted to record it as part of her profile.
As an online subscriber, the paper lets Julie “personalize” her
WSJ home page by identifying stocks that she watches and
industries that she follows. As a result, every time she logs
onto the WSJ website, the stocks that she follows are listed in
their own column along with links to news stories about both
the companies and the industries that she follows.
In this example, the WSJ has used data that Julie supplied
to customize the way that it delivers its product to her. The
hope is that, by helping her sort through the news more
efficiently, the WSJ is raising her satisfaction regarding its
product/service offering.
That’s how CRM is practiced; it is data driven, it flows out from the company to the
consumer and it is communicated through a company-defined channel.
Social CRM
Owned Media
Now let’s advance the story a bit and say that Julie is one of the 500 million people
who has a Facebook account, and one of the places that she likes to visit within
Facebook is The Wall Street Journal Fan Page. During a recent visit, she feels
compelled to comment on a story that really moved her. At the end of her post,
Julie mentions that she was trying to send the story as an e-mail, but the system
lost her contacts.
Later that day, much to her surprise, Julie gets an e-mail that
reads: “Sorry to hear that the system lost your contacts. We
checked into it and found that we were able to retrieve them
for you, so we put them back into your profile. Hope this
helps. Please let us know if there is anything else that we
can do for you.”
In this scenario, we assume that the WSJ practices Social CRM and has a
proactive consumer relations contact center. If so, it is able to engage Julie and
complete a service recovery operation. If Julie is like most consumers, this will
strengthen her relationship with the WSJ beyond what it would have been had the
problem not occurred.
That’s how Social CRM is practiced; rather than a data-driven prompt to serve
Julie, the WSJ responded to a social event prompt. Rather than being initiated by
the company, it is initiated by Julie. Rather than delivering a response through a
company-chosen communications channel, it is through a communication channel
chosen by Julie.
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4. Earned Media
Let’s move our story forward by assuming Julie was so impressed with the
customer service that she received that she posts the story on her Facebook page
where her 130 friends can see it. A colleague at GE sees it
and posts it on a professional blog that she maintains. Once
there, it generates a string of responses. Eventually a story
line develops around the idea of using the WSJ to research
companies before going on sales calls. Someone even jokes
that the WSJ should sell a service called “Everything you need
to know before setting foot inside a prospect’s business.”
Social Market Research – “Listening”
To make things interesting, let’s assume that the WSJ employs sophisticated
listening technology, and that by listening, the WSJ picks up the Facebook post
and the blog post. Let’s further imagine that the blog story fits into a growing
segment of WSJ subscribers who seem to be using the WSJ to research
prospective or existing clients.
Note that by monitoring owned media and listening to earned media, the WSJ is
able to gain insights into how its product is being consumed.
Centralized Consumer Relations Hub
If Dow Jones has a centralized communications hub, it could leverage these
capabilities across all of its media properties as a global center of excellence.
Supporting this effort would be a single database composed of CRM data, contact
center engagements that include phone calls, web chats and e-mails, and social
engagements that include Facebook, Twitter and blogging. Thus, all of Julie’s
interactions with the WSJ would be available.
Returning to our story, imagine that the WSJ uncovers an
insight that seven percent of all Dow Jones consumers
are using its publications to search for information about
prospective or existing clients. Dow Jones decides to label
this “friendly intelligence,” and builds a new intelligence
gathering tool across all of its publications.
In addition to the WSJ’s promotional efforts, a contact engagement professional
posts a comment on the blog that Julie’s friend maintains that reads: “We read
your post about the Journal and are thrilled to hear that your friends are using
it to research companies. We wanted to make sure that they know their Journal
subscription entitles them to use any of our other publications at no additional
cost. If they go to the WSJ home page they can find links to our new intelligence
gathering tools. Good luck with the prospecting!”
So at the end of our story we see how Social CRM is practiced:
• It is relationship driven rather than data driven.
• It is directed by the consumer rather than the company.
• It is communicated through channels that are chosen by the consumer.
• It is used to gather intelligence, develop insights, and launch or adjust
product offerings.
• It is a facilitation tool for a company that looks to its consumers as the critical link
in creating products and services that lead to high levels of customer satisfaction.
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5. Facts to Consider
• The fastest growing sector of Internet Step 1: Start Listening
use is communities (+5.4% in a year). As you establish a social presence,
Nielsen, “Global Faces on Network engage in social market research and
Places” listen to what consumers are saying about
• Member communities reach more each brand, both inside and outside
Internet users (66.8%) than e-mail of your owned communities. This is an
(65.1%). Nielsen, “Global Faces on important step, as most consumers reside
Network Places” outside of your owned communities
• The average Facebook user has 130 (typically five to 10 times the population of
friends, is a member of 80 different a brand’s self-identified communities).
communities and creates 90 pieces of
When people tweet, blog or post on social
content each month. Facebook
sites, they are presenting a slice of their
• By 2010, over 60% of Fortune 1000
lives to a community. They essentially
companies will have some form of
reveal how they use each brand and the
online communities deployed for CRM
reason behind their usage. In the past,
purposes. Gartner Group, “Business
this type of derived demand information
Impact of Social Computing on CRM”
was only available through extensive
conjoint analysis in a test environment.
“It is the combination of social Today, we can actively listen and build an
market research layered onto understanding of individual consumers by
traditional CRM data that provides using their own words.
the ultimate power to deliver relevant
This program also taps into the macro
experiences at optimal touch points
discussions surrounding the parent brand
and with appropriate frequency.”
portfolio as it relates to specific issues
such as “quality, health, innovation,
environment and trust.” These can then
Building the Social CRM Model be benchmarked against competitors.
Creating a global consumer relations The centralized knowledge base becomes
communication hub as a center of a key asset to identifying patterns,
excellence requires truly knowing each discovering breakthroughs and driving
client individually and being able to product innovation.
interact with each appropriately. The Step 1 Goals
recommended method for accomplishing • Mine all of the online and social
this combines the traditional profiling of conversations across the parent brand
a CRM model with actively listening to portfolio on owned and earned social
consumers and identifying influencers media (e.g., blogs, message boards,
while they are interacting within their social networks, media and news sites).
respective communities. It is the • Track each brand independently for data
combination of social market research accuracy.
layered onto traditional CRM data that • Collect available profile data from each
provides the ultimate power to deliver online conversation including users’
relevant experiences at optimal touch hobbies, interests, demographics (age
points and with appropriate frequency. and gender), geographics and ethnicity.
This is achieved at even lower costs as • Merge all of the user profiles into one
consumers also become ambassadors common profile database.
and assist each other with tips, anecdotes
and information on the brand.
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6. awareness and cross-use linkage of
brands. Step 3 is the stage at which
specific campaigns and strategies can be
developed through ideation.
Step 3 Goals
In Step 3, our goal is to gain insights by
identifying:
• Cross-correlated consumer profiles (i.e.,
users of multiple brands)
• Consumer interests across the portfolio
and between brands (e.g., dieting and
weight loss are the primary purchase
drivers for brands A, B and C)
• Consumer demographics across the
One of the benefits of taking this first portfolio and between brands (e.g.,
step comes from establishing individual Hispanics desire brands C, D and F
profiles of people who are interested in because of reasons X and Y)
your company. Social market research • The mindset of the consumer (e.g., X%
gives us an independent method of of brand-A, -B and -C consumers love
identifying consumers. It also gives us country music)
greater insight into the true motivators of • Influencers across the portfolio and
each individual’s brand preference. Finally, between brands (identify and leverage
it provides us with an effective opportunity influencers where they reside)
to listen to how people view competitive • Other high-value insights that inform
products and the service offerings that strategic decision-making
surround them.
Step 4: Program Development & Testing
Step 2: Integrate CRM Basic Social CRM engagements start
In Step 2, we take existing CRM with responding to the social prompts
information developed at the brand level, that arise from listening to the owned and
including the consumer contact centers, earned social media in Step 1. This level
and combine it with the profiles that we of engagement requires the development
are developing through active listening. In of a database of answers and customer
many cases, we are able to identify people service contact center training that
who exist in both data sets and combine enables quick and accurate responses to
their records into highly accurate and these prompts.
detailed profiles on a common information
technology platform. Additional engagement opportunities are
drawn from gaining insights into the social
Step 2 Goals market research that accompanies Social
• Identify internal consumer databases CRM. Here we are looking to stay ahead
• Collect data of both the market and our competition.
• Unify CRM profiles and Social CRM By using insights gained from this
profiles in one common database process, companies can make changes
to their communications plans and then
Step 3: Connect Data Points
test the public reaction to those changes.
This newly integrated, robust database
Product launches, commercials and social
allows us to look at the entire experience
initiatives can all be tested through this
continuum and develop the relevant
centralized resource by providing real-time
experiences, optimal touch points
monitoring of public sentiment.
and frequency that will increase
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7. Social CRM
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Winning the Race to Completely
Satisfy Our Consumers
We believe that Social CRM is the logical anticipating consumer needs, literally
outgrowth of customer relationship contacting them before they contact us.
management. In fact, we believe that this
Turning this capability into a competitive
is exactly what the early pioneers in the
advantage requires the establishment of
field were looking for – a way to listen to
a consumer relations communications
the consumer, record what they want and
hub that can listen and engage across
give them a better product at each turn
all brands and all touch points. By
of the cycle. All signs point to the early
accomplishing this, we can better serve
success of this effort to positively impact
our consumers by anticipating their needs
individual brands. However, the biggest
and driving their satisfaction levels closer
gains seem to point toward centralizing
to the ideal of “completely satisfied.”
the function and “gathering all the trees so
that you can see the forest.” It is here that As has often been observed in the social
a company’s ability to leverage insights media space, it is not always the big that
can truly result in the development of eat the small, but rather the fast that eat the
competitive advantage. slow. Social CRM has the unique ability of
keeping companies one step ahead in the
Social CRM allows us to observe how
race to satisfy their consumers.
consumers interact with multiple brands
across multiple touch points. It allows us
to understand the interests, passions and
preferences of consumers and gives us the For more information, please contact:
knowledge to provide each consumer with Louis Furlo Jr.
relevant experiences, at the optimal touch Regional Vice President
points and with the appropriate frequency.
187 Danbury Road
This model of consumer relations is fast Wilton, CT 06897
becoming the dominant paradigm for T 203.354.0971
F 203.354.0976
louis.furlo@morleynet.com
www.morleynet.com
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