You Need New CRM Solutions To Keep Pace With the New Social Consumer

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It’s the start of the new year and my phone is ringing off the hook as CRM professionals and technology solution providers call to debate the impact of that burgeoning new phenomenon: the social Web. Does it matter to the CRM community? Big time.

The social Web, a.k.a. Social Computing among my colleagues here at Forrester, includes the fast-growing peer-to-peer (P2P) activities like blogging, RSS, file sharing, open source software, podcasting, search engines, and user-generated content. These technologies have seen a rapid adoption — 22% of adults now read blogs at least monthly, and 19% are members of a social networking site. Even more amazingly, almost one-third of all youth publish a blog at least weekly, and 41% of youth visit a social networking site daily. Technology and social changes are creating a potent mix of forces that will transform the way all businesses operate, create products, and relate to customers.

CRM is being redefined, with a torrent of new acronyms and labels spilling forth from consultants and pundits: “Social CRM”, “Collaborative CRM,” and “CRM 2.0.” Traditional CRM solutions will continue to be important to enable organizations to aggregate customer data, analyze that data, and automate workflows to optimize customer-facing business processes. But, changing consumer/customer buying behaviors and new Social Computing technologies are spurring the idea that new generation CRM solutions will, and must, emerge.

My clients are looking farther afield in their search for solutions to help them manage their relationships in the new world of the social consumer. They are looking beyond the traditional solutions vendors like Oracle (Siebel), SAP, Microsoft, Consona (Onyx), and even the newer software-as-a-service (SaaS) providers like salesforce.com, and RightNow, in their quest to collaborate with customers in new ways.

If you want to listen to your customers more closely, consider creating and participating in private communities supported by vendors such as: Communispace, MarketTools, and Think Passenger. Monitor “market buzz” and perceptions, using solutions from: Nielsen BuzzMetrics, TNS MI/Cymfony, Umbria, and MotiveQuest.

Help the fans of your products spread the message more easily through social networks like MySpace and Facebook. Find ways to communicate continually with customers and monitor responses using blogs supported by technologies from Six Apart, WordPress, and Google Blogger.

Develop your capabilities to use customer opinions to increase sales through ratings and reviews using forums like Bazaarvoice and PowerReviews.

Help customers to solve each others’ problems with solutions that support customer forums from Lithium Technologies, Jive Software, and Prospero Technologies. Enable customers to build solutions together; think about using Wikis like SocialText, Confluence, and Wikia.

A New Year? Yes. A “next generation” of CRM solutions emerging? Ditto.

4 COMMENTS

  1. Bill

    Thank you for posting on CustomerThink. It is always great to hear from an experienced analyst such as yourself.

    When I look around at what is happening in business today, I wonder to myself whether what we have traditionally called CRM – marketing, sales and service – is really enough for business to succeed. In particular, I wonder whether CRM needs to be extended, to cover the end-to-end customer experience, (including the all important months or years of the usage experience). To Customer Experience Management (CEM) in other words. Whether it should be broadened, to involve customers more in innovation, in CGM (like you mentioned), in social selling and in self-service. To Customer Co-creation. And whether it should be deepened, to describe how each CRM capability’s process, technology, information, work climate and organisational components dynamically work together to create value.

    Your article already starts to make the case for extending CRM to include the social computing elements of Customer Co-creation. The case for expanding this to include CEM is equally strong. But as the Forrester Best Practices Framework for CRM that you very kindly provided a link to clearly shows, the framework is already obsolete (despite being written in August 2007); it does’t contain any CEM capabilities, nor any Customer Co-creation capabilities, nor a broken-down, dynamic view of the capabilities. It provides a snapshot of static CRM 1.0.

    We need a new capabilities model for CRM 2.0 (call it what you will). One that includes a better understanding of the customer’s end -to-end experience, one that includes more customer co-creation and one that has a detailed, dynamic understanding of how the capabilities work.

    Look as I may, I haven’t yet found a coherent capabilities model for CRM 2.0. Not from the analysts, not from the consulancies, not from the CRM auditors (like QCI) and not in the many busineses I work with.

    CRM will always be work in progress. But who is going to progress the work in CRM 2.0?

    Graham Hill
    Independent CRM Consultant
    Interim CRM Manager

    Readability Index: 13

  2. Bill, glad to have you blogging on CustomerThink!

    Enjoyed your first post on Social CRM. Just when you think the innovation has stopped in the CRM software industry, along comes social computing to stir things up.

    I think it’s the best chance that CRM has to move from the company-centric, controlling paradigm it has had over the years, to a collaborative future.

    Bob Thompson, CustomerThink Corp.
    Blog: Unconventional Wisdom

  3. Great post! Thanks

    I want to call out a couple things that I believe are implied but need to be highlighted in your post above:

    1) Social Networking / Social Web / Online Technologies should not (can not?) be thought of in isolation of other customer relationship channels; the key thing to understand is that now is not only about the Company <> Customer Relationships but now we have also the Customer <> Customer Relationship element (a very important element indeed, as is what helps us identify Influencers/Advocates).

    2) If the above is true (which I believe it is) the platform solutions we will all need to address this new relationship space will need to become fully integrated with and drastically change the CRM solutions as we know today; you will need to be able to know and do something about your Customer <> Customer relationships from your CRM suite (i.e. identify key advocates and empower them to spread the good word).

    3) Program that successfully take advantage of the capabilities and philosophies mentioned above will be of paramount importance; just like CRM strategies continue to fail in some companies because the programs are not in place to properly use the great tools available today we will also have people that implement all of these new great capabilities and fail to use it correctly (and likely blame the tools for it)

    Filiberto Selvas
    http://selvascano.spaces.live.com/

  4. William Band, Forrester Research
    I thank you Bill. The catch is here. Your name is William and you call yourself Bill. I understand the elasticity of Robert called Bob, William as Bill, Kennedy as Ken, Turnkey as Turn or only Mr Key. But this sis what I understand, not all do, do they. What I read is slightly skewed. The CRM does not work always. WORK THE WAY YOUR BUSINESS DOES. The third method involves showing your team that CRM does not change the way your company does its best business. … Secondly as it is implemented marketing strategy does not sufficiently encompass the new CRM enabled multi-channel environment. What CRM does is to provide …
    http://www.creativematch.co.uk/viewnews/?88468 – 101k – Cached – Similar pages… WhyCRMdoesNOTwork.com reflects on the sales software needs of midsize corporations and it proposes a brief yet in-depth explanation of the reasons why CRM …www.whycrmdoesnotwork.com/ – 35k – Cached – Similar pages
    I read the book and I do believe that CRM is legging.
    Let me elaborate. When I came to know of the supermarkets’ handling the online stock methods, real time, as it is sold the suppliers are informed that the supermarket on that street has sold so many of our product so s soon as the level drops it is topped up. Here is the problem, When I read the book by Amazon.co.uk: Shopped: The Shocking Power of British Supermarkets: Books: Joanna Blythman by Joanna Blythman.
    http://www.amazon.co.uk/Shopped-Shocking-Power-British-Supermarkets/dp/0007158033 – 139k – Cached – Similar pages
    This book emphases the relabeling of the out dated goods, keeping the old smelly fishes near the freshly baked breads to hide the pong. Now when I look back at the real time issue, I feel I am cheated.
    Firozali A Mulla MBA PhD
    P.O.Box 6044
    Dar-Es-Salaam
    Tanzania
    East Africa

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