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Social CRM’s 15 minutes of fame is over, onward to Customer Experience!

By on Nov 5, 2012 4 Comments

In a remarkably short time, Social CRM has gone from the hottest thing around to… yesterday’s news?

I’m not going to say “Social CRM is dead” for two reasons. First, I already said that, and I hate to repeat myself. Second, it’s not really dead, just maturing. Into what, I’ll discuss in a minute.

Here are the signs that Social CRM’s day in the spotlight is just about over.

  • Vendors are shifting their messaging to Customer Experience.

    For those who maintain that Social CRM is a strategy, I suggest doing a search and see how many “strategy” hits you get. The problem with Social CRM is the same as CRM – the vendor community hitched their wagons to the CRM star because it’s a big category for tech spending. Regardless of how S/CRM is defined by strategists, terms are really defined by common usage, which is influenced by vendor marketing.

    One of the first vendors to adopt Social CRM messaging was Lithium, a provider of customer community solutions. Last month Lithium acquired Social Dynamx, a “social customer care platform.” In the press release Lithium is described as “the leader in Social Customer Experience.” Three years ago, press releases said “Social CRM.”

    According to Lithium CMO Katy Keim, in the past couple of years customer priorities have shifted from customers service and the benefits of call deflection, to a more balanced approach that also emphasizes customer engagement and the benefits of advocacy. Save money, make money. “Customer experience” resonates better with CEOs that want to get closer to customers, says Keim. The strategy seems to be working, because Lithium’s business has been “crazy good,” helped along with the addition of Rob Tarkoff as CEO, formerly of Adobe — another company that has been pushing CX messaging. A $50M infusion speaks for investors.

    Other vendors have also abandoned Social CRM messaging, including Oracle, the company that was the first to use the term. Oddly enough, the company never capitalized on its first mover status, and now is pushing Customer Experience as part of a cloud solutions strategy after acquiring RightNow. Industry analyst and Chief SCRMer Paul Greenberg recently called out vendors (including Oracle) for “jumping on the [customer experience] trend bandwagon without substance.”

  • Analysts can’t create a concise Social CRM category

    Analysts are in the business of categorizing technologies and applications, to help buyers make better decisions. Even in this age of social-empowered consumers, analysts are consulted for their views, and none more so than Gartner Research.

    Unfortunately, part of the game I see played is vendors that influence (pressure?) analysts to endorse a new category. Analysts are also trying to be thought leaders, so these motivations conspire to cause new “categories” to be born prematurely. I believe Altimeter Group was the first to endorse Social CRM as a category, and did some excellent work describing use cases. But with the possible exception of social media monitoring, Social CRM was not defined as a distinct application but rather a collection of a) tried-and-true CRM (sales/marketing/service) applications infused with social functionality or b) re-branded community/forum software providers that have been around for years.

    Gartner published a Social CRM Magic Quadrant, but this just served to muddy the waters. According to Gartner, Social CRM solutions include a mix of social monitoring (e.g. Attensity), online community solutions (e.g Lithium), and social selling (e.g. Artesian). Apples, oranges and cumquats. The MQ doesn’t help buyers choose, it just throws a blanket over a bunch of disparate applications that include some form of social functionality. Pointless.

    Get Satisfaction was included in the Gartner MQ even though it “asked to not be included and did not submit any material to Gartner.” This according to Jeff Nolan in an aptly named blog post The 2012 Social CRM Tragic Quadrant. Maybe it’s just sour grapes for being classified in the lower-left quadrant, which could be Gartner’s way of punishing vendors for not providing data. I don’t really know, but none of this helps define Social CRM crisply, which I believe is one reason business people have lost interest.

  • Social Business requires an integration of Social CRM and Enterprise 2.0

    In the early days, “socializing” CRM meant focusing on customer-facing applications. Enterprise 2.0, on the other hand, came to mean using social media/networks internally.

    But as time goes on it has become clear that these two ideas should meld together. I’ve said from the beginning of social mania that if companies want to create better customer engagement, they need to integrate internal and external efforts into a long-term social business strategy. In my recent article:

    Some (including me) are now using the term “Social Business” to include both internal (Enterprise 2.0) and external (Social CRM) use of social software for business. In either case, let’s remember the point is to enable better employee teamwork and/or customer engagement, to drive improved business performance. It’s not about singing Kumbaya around the campfire.

    Some vendors are now picking up on this trend, including Moxie Software which offers social solutions to help both employees and customers. It’s interesting to note, however, that Moxie’s new go-to-market partnership with Microsoft Dynamics CRM “validates our strategy of delivering superior customer experiences” according to Moxie CEO Tom Kelly. Here we have a social vendor (Moxie) combining with a CRM vendor (Microsoft) — a partnership that makes good sense to me since Microsoft lacks the customer interaction functions (social, email, chat) that Moxie provides. But Social CRM is not the banner raised over this announcement.

    In other developments, Jive has shifted from internal communities to put more emphasis on customers. Similarly, Salesforce.com started with internally social networking (Chatter), but recently announced it would use the same technology to support private customer communities. Yammer, introduced simple customer forums last year and I expect to see more development in this area as part of Microsoft.

    As a result, the usage of Social CRM and Enterprise 2.0 is waning, while Social Business is on the rise.

Trend watching

In 1968, Andy Warhol said that, “In the future, everyone will be world-famous for 15 minutes.” With Social CRM that’s not literally true, because the term has been in the spotlight since 2009. In my 15 years of industry watching, 3 years is the lifespan of most marketing buzzwords.

Here is a Google Trends chart comparing the terms discussed in this post. Big picture: looks like “Customer Experience” and “Social Business” will stick long-term.

I believe Social CRM will settle down into what many suggested from the outset — an extension of CRM, not a completely new thing. Buzzwords aside, Social CRM advocate Mitch Lieberman, in The Social CRM Non-Revolution, sums up smartly with this:

What is clear is that the companies who can successfully extend their CRM practices to include social media channels (in process and execution) will be at the forefront of truly leveraging ‘social’ for business benefit.

Now we’ll have to see if Customer Experience is just another fad. Check back in 2015!

Further reading:

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4 Responses to Social CRM’s 15 minutes of fame is over, onward to Customer Experience!

  1. christine crandell November 6, 2012 at 7:12 am #

    Bob, great post and I’m glad you said it. I would go so far as to say that not only is Social CRM dead but so is social business. We have evolved past that and the effect of multiple forms of collaboration and interaction within, beyond and across companies is driving new rules of how to organize work, lead, manage and measure.

    Keep writing these thoughtful posts :)

  2. Bob Thompson November 6, 2012 at 12:51 pm #

    Social business — using social media/applications for business purposes — has been a mixed bag so far.

    Here’s my quick take:
    * companies that have an open and collaborative culture have a good chance for success using internal social networking, but will struggle to prove the ROI
    * companies that are already customer-centric will adopt social interaction channels (think Zappos) and won’t care about the ROI

    So that covers maybe 10-20% of enterprises! The rest will have to take a leap of faith or find a specific application where social adds value.

    When I researched social business for a previous article, I got a headache. You can make arguments pro and con, and find studies to support either position.

    The ROI story is murky at best, and yet some companies do succeed and more will as the field matures and companies change. But just like process automation AKA CRM didn’t make sales organizations have a real sales process, social tech won’t make companies social.

    Five years from now, I’m willing to bet we won’t talk about Social business any more than we talk about Phone business or Email business. Success will be a different thing entirely, because Social tech is just a tool, it’s up to the user whether it delivers benefits.

    And now, I’m off to do an ROI study on my smartphone!

  3. Mitch Lieberman December 17, 2012 at 8:54 pm #

    Bob,

    Nice post and thanks for the mention. I do not disagree with much of what you are saying, the ‘but’ here is one a different type.

    It occurred to me as I was listening to last of a series of presentations during the past few weeks. Customer Experience is very very big and broad. It is also not built to be a software or technology category. It may be becoming this way because we are all so connected. My concern is that Customer Experience is too big and broad to affix to software.

    The goal of the technologists is to connect the real world with the digital world – but for the most part, experiences are visceral, not technological and for so much of the world have nothing to do with tech – If I go for a run, hike, ballgame, dinner, drinks, lunch, theme park, movie, play, ballet, air travel, hotel stay…. the list goes on – all experiences, none having anything to do with tech. So, the job is hard.

    I view CRM and in part the social connection of CRM (there I said it without saying it) as the way in which we try to enhance the experience of the real event, though information and context. I want to know the customers food preferences or allergies, room type, shoe type, favorite drink, favorite ride…I may gain some of this knowledge the old fashioned way or via social means.

    Yes, we beat up the buzzwords – pretty quick. Sometimes they come and go so fast that most of the world misses it completely. The key point is that it does not change what we are trying to do, does it?

    Mitch

  4. Bob Thompson December 17, 2012 at 10:16 pm #

    Mitch, buzzwords serve to rally interest in an idea, and that’s not all bad.

    I remember quite a few years ago talking with Ed Thompson at Gartner and he said that “CRM” was the “flag of convenience” for a customer-related initiative, because it was the hot buzzword.

    Fast forward a few years and it became Social CRM. And now Customer Experience is the hot ticket.

    The dark side of buzzwords is when they become too big and too broad. Then the backlash ensues.

    On Linkedin there’s a discussion boiling about how some executives are already tired of the CX/CEM hype — see “I am concerned with the growing executive backlash against CX” at http://linkd.in/R2IlFC.

    So I agree with you completely, they don’t change what we are trying to do. Being “social” is important. So it delivering a great experience. So is managing customer information.

    It’s unfortunate when buzzwords and marketing gets in the way of clarity and real insight. And yet, we do need labels to pin on complex ideas to simplify our world and communicate.

    I don’t think CX will become a software category any more than Social CRM became one. You’re right, it’s too big and broad. But digital experiences are growing in frequency and importance, and technology will be required to make the digital world delightful to us humans. So I see plenty of opportunities for technology in CX but hope that technology doesn’t become the centerpiece.

    For more on the risks that CX faces see “RIP Customer Experience – Seven reasons why Customer Experience is in danger of dying” (http://bit.ly/PHFmPs). This post and the debate it stimulated could easily have been written (and probably was) for CRM or Social CRM. Here we go again!

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