How do social media influence crm?

Gastredacteur: Nathalie Bulsing

We know social media is all about being social. Being social is all about people and the connections they have and maintain. Social media makes it possible to strengthen the relationships with your employees, (potential) customers and online community. It also helps you improve your image and reputation. Therefore it is obvious social media can be used in your customer relationship management. If that’s the case you’re talking about ‘social CRM’.

There are a lot of different definitions of the term social CRM. When compared, they all conclude the following: Social CRM means the use of social media to strengthen or improve the relationship with your customers or prospects through interaction and sharing on specific social media platforms, which will eventually result in a more loyal customer community and mutual understanding.

Using social media can improve your customer relationship, providing that it is used in a correct way. Social media makes it possible to complement your customer contact information which helps your communication processes. However the true value of using Social CRM lies in the interaction part of your communication strategy. This interaction will sacrifice some of your company safety, but the customers will happily accept you being more transparent about your views and goals. This will give them the feeling you accept them as serious and worthy customers. When listening to and using their comments it is possible to improve the creativity and innovation of your services and products. Why not take advantage of this situation? Exactly: no reason!

Social CRM has the same targets as ‘normal’ CRM, but especially the word-of-mouth advertising part undergoes a drastic change: In a normal ‘offline’ situation an unsatisfied customer can tell up to seven times more people about their negative experiences, compared to their good experiences. In this online world where people have hundreds (or even thousands) followers and friends, their opinion will reach much more people. This information will also continue to exist thanks to the Long Tail effect of the internet. It is therefore even more important to keep your online community – and customers – satisfied.

Keeping your customers satisfied is a tough job. That is why you shouldn’t let a novice, inexperienced employee or agency represent your company because he/she will automatically be considered your company’s ambassador. To accomplish this job in a responsible way requires training, experience and good customer insight. Some companies even introduced a webcare team who has leadership over all online activities and posts.  It would even be better if the person(s) in charge is truly affectionate about the company which makes it a bit easier to convince others. Does it sound logical?

Which communication approaches are possible in your social CRM strategy?
You understand the need of social media and acting social. However there are some other different communication approaches when using social media in your CRM strategy. A distinction can be made based on mutual communication and location of the interaction. This will result in four social media paradigms playing a role in social CRM: Inside-In / Inside-Out / Outside-In / Outside-Out. These paradigms imply the following:

Inside – In
This kind of communication approach has its boundaries between company walls. It is about sharing knowledge between people (e.g. employees) within an organization using a special social network platform. This platform makes it possible for employees to discuss blog, share and organize events. This will result in more social communication environment which will give confidence and trust. In return your employees will be more pleased about the company which will be shown to the outer world.

There are different kinds of platforms which support this kind of internal interaction such as the internal regulated SharePoint or one offered by an external agency like Winkwaves. The active interaction inside an organization makes this ‘Inside-In’ social media paradigm, a typical two-way communication platform.

Inside – Out
This kind of communication sends messages to the outside world without really expecting a discussion. It can be seen as a purely informative platform, to share or keep people updated assuming people want your information. It is therefore important to stay interesting and only send information relevant to your industry.

Twitter makes a good example. It is possible to have short discussions, but it isn’t the real purpose of this application. It is however difficult to maintain a discussion because of the continuous information flow received from others. Nevertheless it is important that some people might talk back through these media. It is reasonable to let them know they are not unnoticed by sending a response. Such a reaction may give them motivation to like you more. Some other information sharing examples are YouTube, blogs or Flickr. This Inside-Out paradigm shows to the outer world that you are willing to give a peek of what is happening in your company. These mostly one-way communication methods defines it the Inside-out social media paradigm.

Outside – In
The counterpart of the Inside-Out paradigm is the Outside-In variety. Instead of sending information, you are now collecting information. This paradigm is mainly based on listening and information gathering on social media sites.

It is necessary to get to know what is happening in your online community, because next to information sharing it is just as important to be aware what  people think about you, your products, service and company. Listening to your customers will expand your customer insight which can be useful in your sales, marketing and service strategies. Luckily there are different applications which make it possible to monitor messages on social media sites and prepare the results for further analysis. These applications are still being further developed. The listening and passive attitude – and thus one-way analysis – makes this the Outside-In social media paradigm. 

Outside – Out
This communication approach is the more social one where your online community interacts with each other on a platform which makes it possible for you to monitor their behavior and discussions. Most Outside-Out platforms are specially designed for people to discuss, share, blog etcetera. The people on such platforms build their own community with a common interest. They are therefore belonging to a group likeminded individuals who most of the time expect interaction and discussion.

An example is My Starbucks Idea. This is an online platform where customers can share ideas, vote and discuss. Then Starbucks shows their fans what they’re doing with their ideas. This way the consumers are part of a co-creation process. This feeling of them being needed will result in a more loyal community. Because it is cool you were part of that idea! In this paradigm your customer has a strong central position. That kind of two-way interaction without really interfering makes this the Outside-Out social media paradigm.  

What are the best ways to use these paradigms in a social CRM philosophy?
These social media paradigms are almost never used alone because they want to complement each other. That’s why they cross-react in their activities and functions. For example: normally spoken you would never ‘just’ send a message without having a goal. That’s because you always have a goal to achieve! The need of a cause makes the Inside-Out and Outside-In paradigms are a strong couple. You will give some information and you will get some information, though it can be in a non-interactive way. By sending out a message and monitoring what the reactions on that message are you can get more insight in what your role as an influencer may be and what kind of customers are interested in you. Or when you don’t ‘play the game’ that well it will tell you which customers loathe you. Interesting isn’t it? That’s your chance to find out why they do so and what you can do to improve their opinions! Time to react!

Next to the Inside-Outside paradigms also the Outside-Out paradigm plays an important role in your social CRM channels. This one makes it possible to talk to your customers and online community in an informal way. These kinds of platforms invite them to give their opinion about your activities which can result in new ideas, interesting discussions and innovative theories. This way it will be possible to manage your image, brand and reputation. Together with the other paradigms you have a strong tool to analyze behavior and attitude of your online community. Using these tools you will get to learn more about your target audience and how to interact with them. One very well known social network platform where these kinds of paradigms strengthen each other is Facebook.

The Inside-In paradigm is however a somewhat peculiar one because it indirectly reinforces your customer relationships by your satisfied employees. The clear communication where interactivity is a key aspect will give you a stronger bond with your employees. In return they will transmit their positive experiences with the outside world. So give them a chance to show what they know and how this fits into your business. This is the Inside-In variation of co-creation.

Indeed a social medium has to be a transparent medium and will anyhow show some of your weak spots. Your online community will also grab this possibility to counteract, give complaints or undertake other surprising actions. This is a risk you must be willing to take. Therefore you have to know how to anticipate in these kinds of situations, e.g. think about your crisis management. Keep in mind your community will surely correct you if you’re doing it the wrong way! Type a few keywords like “social media warfare” and “Facebook” in any kind of search engine and you’re right into some nasty examples of how NOT to manage your social relationships. I truly hope you’ll learn something from it!

When you know and acknowledge what being social really is about, then you know how to use social media as a means of your CRM strategy.

And now?
Understand all this information? Then NOW you’re ready to work on your social relationships and let people ‘like’ you! And remember: just like the real world you first have to be social and then you are ready to have and maintain friendships. This also counts for your organization. Don’t forget this when you are about to step into this social media world!
So get into your chair and mingle with the masses, learn from each other and treat them like you would like to be treated. Gather all the social media user guides you can find and the how-to’s to start a webcare team (which also includes where to install it). Listen, interact and be social!

(Het complete artikel is te downloaden en is een afgeleide van de afstudeerscriptie over relatiebeheer in musea)