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Social CRM, The New Frontier of Marketing, Sales and Service, Accenture Report

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Interesting report from Accenture exploring "Social CRM, The New Frontier of Marketing, Sales and Service, Accenture Report" - Written by @jphughes3

Interesting report from Accenture exploring "Social CRM, The New Frontier of Marketing, Sales and Service, Accenture Report" - Written by @jphughes3

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  • 1. Preferred Letter Alternate Letter Brochure Title Brochure Title Social CRM: The New Frontier of Marketing, Sales and Service
  • 2. Social CRM: The New Frontier of Marketing, Sales and Service The emergence and increasing Such a strategy will help them work for all customer needs usage of social media and touch customers at many and segments, even though other Web 2.0 tools has more points and much earlier they can significantly alter the dramatically altered the in the buying process, often role played by more traditional ways in which companies at lower cost than that of contact channels. interact with their customers. more traditional marketing, In short, social CRM presents For instance, buying advice, sales and customer service many opportunities to build a product information and channels. To do so, companies distinctive capability that can technical help is increasingly should embrace the social serve as a building block of being disseminated from media channels being used by high performance: a method consumers to other consumers, their customers, identify and to potentially connect more in some cases without engage with the “super-users” tightly with customers at lower involvement or oversight by who supply product expertise cost and in a way that provides the provider. Clearly, this shift to other customers, and a real differentiation from presents both opportunities harness the power of advanced competitors. and risks to companies. analytics to provide broad insights on customer needs, To derive greater value from wants and behaviors. Perhaps these new communication most importantly, companies channels, companies should must remember that social adopt a “social CRM” strategy. media and Web 2.0 will not Retweet The New Frontier of Marketing Sales and Service | 2
  • 3. Figure 1. As social media has grown in importance, original equipment manufacturers’ control of the buying and service process has declined. Control OEM has over buying/service process Growth in social media No Web Early stages Social networking of Web and cloud explodes The evolution of manufacturer’s call center for support. The introduction of the Internet gave The Conference Board found 77 percent of adult Internet users considered blogs the Internet and consumers more options. They could access further information on products— a good way to get information about a company or product.3 social media as well as limited support information— via the retailer’s or manufacturer’s The preceding data reflects a The evolution of social media and other websites. For most products, though, fundamental shift from a predominantly Web 2.0 tools is having a significant consumers still had to go to a physical “company to consumer” dialogue to impact on both how consumers interact store to purchase items and call the a “consumer to consumer” dialogue. with companies and the level of control manufacturer for support. Indeed, a recent survey from Forrester such companies have over the sales, Research found nearly half of online marketing and service of their products. Today, consumers make their purchases users say information provided by (Although it is difficult to find consensus either via retailers’ or manufacturers’ other consumers is more important on what exactly is meant by “social sites or retailers’ physical stores. to them than data given by marketers media,” for the purpose of our discussion, However, as social networking and of products and services.4 In this new the term refers to Internet and mobile other Web 2.0 tools have exploded in world, companies have an opportunity channels that enable users both to view popularity—a recent study found the or a threat, depending on how they and create content and to share that number of social networking users adapt marketing, sales and service content with others.) has doubled since 20071—consumers have many new sources of product Consider the example of original information and buying advice, as well 1 “Number of Social Networking Users Has equipment manufacturers (see Figure as answers to usage and technical Doubled Since 2007,” Adam Ostrow, July 28, 2009, http://mashable.com/2009/07/28/social- 1). In the pre-Internet days, consumers questions about the products they networking-users-us/ interested in purchasing a product have purchased. According to a recent 2 “Engaging Consumers Online,” DEI Worldwide, 2008 either asked their friends or a retailer for study by DEI Worldwide, 70 percent of 3 Executive Action Series, No. 251, Sheri Rothman, advice. They had to go to the retailer’s consumers have used social media to The Conference Board, November, 2007 4 “Justifying Social Marketing Spending,” Forrester store to buy the item and call the get information on a product, brand or Research, February 2009 company.2 Furthermore, a report from Retweet The New Frontier of Marketing Sales and Service | 3
  • 4. "According to a recent study by DEI Worldwide, 70 percent of consumers have used social media to get information on a product, brand or company. Furthermore, a report from The Conference Board found 77 percent of adult Internet users considered blogs a good way to get information about a company or product." Retweet The New Frontier of Marketing Sales and Service | 4
  • 5. Figure 2. Consumers’ changing preferences and behaviors have made online life more complicated for providers of all kinds. Old World Banner Website Search Direct Phone Call Center Mail Lead Gen Rep Phone New World Social Video IP TV TV Rating Sites Paid Search Widgets entertain inform convert Website connect assist Blogs Call Rep Print Center Mobile Email Organic Banner Search Community Lead Gen Direct Mail Retweet The New Frontier of Marketing Sales and Service | 5
  • 6. Figure 3. Social CRM changes marketing from a push-through funnel to a real-time dialogue at all stages of influence. Forced Message Push "Unlimited" opportunities for dialogue Awareness Awareness Consider Consider Purchase Purchase Usage Usage Loyalty Loyalty Spectrum of opportunity for interaction to influence choice Seized opportunity to Untapped opportunity to influence choice through influence choice through dialogue/interaction dialogue/interaction of their own products to a new In addition, because of the speed with The collapse of the marketing funnel, consumer ecosystem: one in which which customers and information in turn, means the distinctions enthusiasts and detractors can dictate move today, companies must be able to between marketing and sales become customer perception and experience for incrementally, and very quickly, improve further blurred and, in some cases, manufacturers. their operations based on what they disappear entirely. In fact, social media learn from observing customers. As a increasingly is being referred to not in Ramifications for result, many companies have shifted the focus of their investments from building terms of marketing or sales, but rather, as an “engagement channel,” which providers channel infrastructure to creating nimble and robust content management and incorporates elements of both marketing and sales. What are the ramifications of this shift? data collection and analysis capabilities. With consumers increasingly relying on At a high level, the evolution of social From a marketing perspective, the third-party sites for usage and technical media has introduced new contact evolution of social networks and online information, manufacturers must build channels that must be integrated into communities has resulted in a collapse of capabilities to strengthen their brands marketing, service and support strategies. the marketing funnel (see Figure 3). and customer loyalty via these channels, However, while social networking and How so? Traditional, mainstream as well as to up-sell and cross-sell social media are certainly on the rise, marketing forces a message through relevant, related products and services, there are still large groups of customers the marketing funnel, moving through and gather and integrate cross-channel who do not communicate via these tools. stages from building awareness to customer data. Indeed, smart use of Therefore, differentiated service takes on earning loyalty. It only allows dialogue these third-party channels can become an even greater role because of these and relationship building as the prospect a powerful way to boost image and new channels. A thorough understanding or customer progresses through the customer satisfaction while reducing of customers’ channel preferences, funnel. By contrast, the digital revolution, CRM operational costs. combined with insights into the true and particularly social media, makes it value of customers to the business, must possible to engage in a dialogue with drive how companies interact with each prospects or customers much earlier and respective segment (see Figure 2). at many more touch points. Retweet The New Frontier of Marketing Sales and Service | 6
  • 7. A way forward: to discover those that resonate with customers. One example is Intuit, provide valuable intelligence on what customers are thinking, too much focus social CRM which has successfully embraced and enabled a passionate online community on one source or one segment can lead to a narrow or biased perspective. Thus, What should companies do to respond of QuickBooks users that since has companies must integrate the data to these changes? They should start become the place to go for customers they gain from online channels with by developing a “social CRM” strategy, seeking advice and service. Extending other, more holistic quantitative and which Accenture defines as an operating this commitment to the customer qualitative data gleaned from other model, supported by technology and further, Intuit recently purchased Mint. sources to paint a more accurate picture business processes, that is designed com, a provider of free online tools that of their overall customer base. to engage customers in a mutually help consumers manage their finances. "With this transaction, Intuit will gain As they develop their social CRM beneficial two-way conversation. Social another fast-growing consumer brand strategies, companies should consider a CRM is a company’s necessary response and a highly successful Software as number of actions they can take within to its customers’ transformation a Service (SaaS) offering that helps marketing, sales and service to build and from spectators (“TV watcher," people save and make money," said strengthen customer relationships. "newspaper reader," "Web browser”) to participants ("product rater," "blogger," Brad Smith, Intuit CEO. "This move will "ambassador") and their subsequent enhance Intuit's position as a leading co-ownership of the company’s brand. provider of consumer SaaS offerings that connect customers across desktop, A key element of a social CRM online and mobile."5 operating model is a very flexible framework that allows a company to However, companies also must be careful to balance the online feedback 5 “Intuit to Acquire Mint.com,” Intuit press release, observe what customers are doing September 14, 2009, http://about.intuit.com/about_ and saying, and then experiment they gain from customers and prospects. intuit/press_room/press_release/articles/2009/ with different customer experiences While such feedback certainly can IntuitToAcquireMint.html Retweet The New Frontier of Marketing Sales and Service | 7
  • 8. Implications of The National Football League also recently substantially upgraded and devices such as mobile, PC and IPTV, as well as services, including Facebook, social CRM for expanded its social media presence. For the 2009 college player draft, the Twitter, Linkedin); content types (such as user-generated media, short-form video marketing and league set up what it called "Fan War Rooms" for each of the league’s teams, and long-form video); units (for example, ad units); and pricing models (such as sales in which fans could interact with each other about their specific team’s draft cost-per-action, cost-per-engagement or cost-per-desired-outcome). The end of the marketing funnel may picks. The NFL also provided a constant lead to significantly more, earlier, live stream of tweets directly from draft This increased fragmentation means deeper and richer opportunities to headquarters through the days of the analytics must be focused on a build a dialogue with prospects and event and created a widget for Facebook wide range of communication: what customers, and can offer an enhanced that enabled fans to follow the action customers tell the company through opportunity to build relationships and via their own Facebook pages.8 In tweets, Facebook, Amazon.com user influence choice. At the most basic preparation for the 2009 season kickoff reviews, emails, phone and other level, this entails companies embracing in September, the league expanded its channels; what they say to each other (not controlling) all the tools and social social media and community section at through these channels; and how media their customers are using to join NFL.com to include “fan postings, live they interact with other companies. the conversations and meaningfully chats with players and coaches, fan- Furthermore, users increasingly want engaging with customers—or, at the edited video highlight reels, aggregated to enjoy experiences in a seamless way very least, gaining insights into what Twitter and Facebook feeds, quizzes, across multiple screens and platforms. customers are thinking and feeling, polls and other similar material.”9 The permutations of all these variations which could lead to new opportunities will require much more than simple to reach them. Social media monitoring tools also can spreadsheets and gut feel to create glean both quantitative and qualitative the most appropriate experiences for As an example, Virgin America has more responses to advertising campaigns for each customer segment, and will than 20,000 followers on Twitter, which promotions, illuminate opportunities to make optimal marketing spend gives the airline incredible access to improve one’s brand, uncover significant allocation decisions. an engaged and loyal community of unmet customer needs, and identify customers. But beyond simply enabling people who may be highly predisposed Virgin to quickly and inexpensively to a brand or product. Furthermore, we reach customers, the airline’s Twitter believe there will be significant and account actually does the selling for the disruptive innovations within the next company when newcomers ask if they five years in the area of highly relevant, 6 should fly Virgin. targeted marketing that becomes part of the perceived high relevance Drugstore.com emails its customers of the experience itself. Companies automatically three weeks after they that embrace such innovations will have bought something to encourage be positioned to have a much greater customers to post a review of what influence on consumers’ choices they’ve purchased. The company’s chief and, consequently, realize significant marketing officer says doing so not only increases in revenue and profitability makes customers feel valued, but also and sustained competitive advantage. strengthens the connection between the company’s brand and its customers. As As fragmentation increases across the a result of the program, Drugstore.com board, companies will have to adopt 6 http://www.washingtonpost.com/wp-dyn/content/ saw a more than 300 percent increase in more sophisticated analytics and article/2009/07/12/AR2009071200319.html new reviews posted. In addition, because dynamic optimization capabilities to fully 7 “What Do You Think?” Geoffrey A. Fowler, The Wall Street Journal, October 12, 2009, page R6. customers who respond to the emails capitalize on social media channels. More 8 “How NFL is Drafting Fans Via Social can be verified as actual customers, specifically, companies will continue to Media," Elaine Wong, Brandweek, April Drugstore.com is able to identify see increased fragmentation in almost 23, 2009, http://www.brandweek.com/bw/ reviews by these individuals as coming all attributes of user experiences as well content_display/news-and-features/direct/ e3i202b681b4f137513fd1730c682acf73b from actual purchasers, which adds as in performance marketing products 9 “NFL Kicking Off Some Site Upgrades,” Eric Fisher, authenticity to the reviews and further and services. We will see fragmentation Sports Business Journal, September 7, 2009, 7 bolsters the company’s credibility. in engagement platforms (for instance, http://www.sportsbusinessjournal.com/article/63490 Retweet The New Frontier of Marketing Sales and Service | 8
  • 9. Support and understand customer service issues and proactively respond before they service in the can impact their brands. Other leading companies—aided by the use of new social media era capabilities from enterprise software providers—are using sites such as Twitter Consumers today increasingly see to more quickly solve service questions. social media as channels and tools A great example is Comcast, which for customer service. Indeed, one managed to turn a customer's "Tweet" recent study found that 43 percent of into a case study on how to learn about consumers think companies should use and resolve a customer’s issue via a social media to solve their problems.10 social network. In this case, an influential customer (a well-known tweeter with A number of leading enterprises have 12,000 followers) called out Comcast via taken major strides toward fulfilling Twitter for the trouble he was having such wishes by creating an online with his Internet connection. Comcast environment that enables customers discovered the tweet and, within to interact with each other as well 20 minutes, responded and restored as company representatives to find 13 service. In his speech at the 2009 Web solutions to their issues. For example, 2.0 Summit, Comcast CEO Brian Roberts Sybase utilizes newsgroups to enable said Twitter “has changed the culture of users to communicate with product our company.”14 engineers and other users about specific issues, thereby creating a forum for customers to seek and obtain technical Social CRM is driving a sea support. And this is a rich experience: change that is requiring the customer gets multiple answers to companies to invest in new his question from a variety of sources, service and support capabilities. including super users (“Team Sybase” volunteers) and Sybase employees. From To Furthermore, each community forum is categorized by product to simplify the Static Dynamic customer’s search for information.11 Knowledge Knowledge Management Monitoring A variation on this theme is the approach taken by Samsung, which Call Center Social Media partnered with CNET to create an Operations Integration online community for all Samsung products. Although the forum is staffed Information Desktop by Samsung employees, it is far more Gathering and Applications than just a “Q & A with Samsung.” The Analysis company acknowledges that often the most helpful answers come from forum members themselves, and encourages 10 “Cone Finds That Americans Expect users to contribute their insights to Companies to Have a Presence in Social Media,” company news release, September 25, 2008, help those with questions.12 The key is http://www.coneinc.com/content1182 to determine how to “authorize” users 11 http://www.sybase.com/support/community- to provide assistance and enable and forums support the most helpful of these users. 12 http://forums.cnet.com/5204-13973_102-0. html?forumID=146 13 http://www.penn-olson.com/2009/09/21/5- Transforming the ways in which service social-media-disasters/ is provided is only the beginning. Social 14 “Comcast: Twitter Has Changed the Culture of CRM also can be used to help companies Our Company,” MG Siegler, TechCrunch, October proactively unearth issues before they 20, 2009, http://www.techcrunch.com/2009/10/20/ comcast-twitter-has-changed-the-culture-of-our- become problems. Indeed, many leading company/ companies crawl third-party sites to Retweet The New Frontier of Marketing Sales and Service | 9
  • 10. Figure 4. The “virtuous loop” knowledge management lifecycle. Authors create and/or Publishing workflow hor modify content. Authors Aut allowing for review, now may be customers P approval and publishing. as well. ub lis h Content analytics are Analytics critical to understanding what content is being used and rated. These analytics provide insight to where improvements are needed and what is working well. me Users (i.e., agents and su Fe n ed Co bac customers) use the Users provide feedback k content. Analytical data such as recommendations is gathered based on for new content or updates this usage. needed and/or ratings on how useful content is. Salesforce.com has announced it will loop” that provides for a continuous integrate Twitter into its solution, process of learning, whereby solutions and complementing its existing integration answers are created and strengthened by with Google and Facebook. This solution input from both customers and internal will enable a company to both conduct resources—which, in turn, makes the automated searches of Twitter content overall online service experience more to be pulled into salesforce.com’s system, robust, helpful and easier to use (see and to set up alerts when Twitter users Figure 4). The key to such a virtuous loop mention the company name to track is a technology platform that can support sentiments.15 Of course, such tools do customer forums, self-service FAQs and not completely obviate the need for internal knowledge management in the personal intervention. Virgin America, same framework. for instance, has the equivalent of 1.5 people dedicated solely to monitoring Second, social CRM gives companies and engaging Twitter and other social the opportunity to redefine the roles networks to understand what customers played by their contact centers and are saying about the airline.16 the agents who work in them. Indeed, with an increasing volume of simple In incorporating social media into its transactions being supported by self- service and support operations, a company service channels (including mobile must keep several things in mind. First devices, IVR and kiosks), the role of the and foremost, companies must ensure call center gets drastically diminished. they integrate their customer forums with their internally developed knowledge 15 http://thenextweb.com/2009/03/23/salesforce- management systems. Importantly, the integrates-twitter-service-cloud/ integration should support a “virtuous 16 http://www.washingtonpost.com/wp-dyn/content/ article/2009/07/12/AR2009071200319.html Retweet The New Frontier of Marketing Sales and Service | 10
  • 11. "The end of the marketing funnel may lead to significantly more, earlier, deeper and richer opportunities to build a dialogue with prospects and customers, and can offer an enhanced opportunity to build relationships and influence choice." For many companies, it may make sense “virtuous loop” knowledge management, a customer’s situation—using low-cost, to allow external communities to handle the time needed to resolve these issues offshore engineering resources as well as Tier 1 and possibly even Tier 2 levels of will be substantially reduced and first- a new generation of automated tools that service inquiries. Such communities, which call resolution will be much more likely. can rapidly collect and sift through data can provide a high level of service at costs to glean insights into what a customer most companies cannot touch, include Third, each interaction—regardless of the is experiencing—than they would get not only ad hoc collections of customers, channel in which it occurs—must be united through an initial phone conversation but also more formal entities such as into one complete composite customer with a much more costly customer service CrossLoop. CrossLoop is a “consumer record that can provide accurate, cohesive agent. This arrangement has the potential Internet company that empowers service. In other words, a social CRM to substantially reduce the cost structure everyone to help someone anywhere in strategy should ensure that interactions of support while streamlining and the world with its free and easy-to-use with call centers become more customer- simplifying the process for consumers. software application for desktop sharing. focused, value-added and relationship- CrossLoop connects computer users with based. The key is that companies no longer Finally, companies can improve the trusted, qualified service providers and can optimize a single channel, but rather, user experience while reducing service friends who can provide the support they must optimize the customer experience and support costs by building into their need quickly and conveniently.”17 across all channels of support, which products or services some capability requires the integration and analysis of that enables customers or the devices However, even with external structured as well as unstructured data themselves to proactively take charge communities handling much of the in real time. Technologies that exist today of problems on their own. An obvious initial service requests, companies still make such “voice of the customer” analysis example of this “soft panel” approach is can expect direct calls from customers much more active, enabling companies to the ability of devices such as the Xbox and unwilling or unable to take advantage of analyze a customer contact as quickly as iPod to assess the condition of the device self-service options—so companies must five minutes after the interaction. each time it is connected to the Internet have agents who can provide personal and automatically download or suggest service when needed. If a company Fourth, the interconnectedness of today’s new software to correct any shortcomings. has adopted the preceding principle of high-tech products via the cloud enables companies to get more information on 17 http://crossloop.com/about/aboutus Retweet The New Frontier of Marketing Sales and Service | 11
  • 12. Conclusion From a marketing and sales perspective, companies should embrace the same sites preferred sources of solutions to customers’ problems. Also, companies We are at a tipping point. The majority social media sites their customers use, that crawl third-party sites to proactively of customer CRM interactions now are and use those sites to both create identify possible service issues mentioned occurring outside of company-controlled dialogues with customers to help them in consumers’ online conversations can channels, and companies must adjust with their purchase decisions, and mine avoid or reduce the impact of potentially their CRM operating models to adapt sites for information on what customers bigger problems that arise when issues and engage these outside channels are saying about the company and its are left unaddressed. to drive growth and keep customer products. New tools that enable the amalgamation and analysis of a wider By making social CRM an important satisfaction high. element of their customer strategies, range of quantitative and qualitative data As noted, consumers are increasingly will be a key enabler in this regard. companies are better positioned active users of social media sites, and to achieve a stronger and more they also view such sites as purveyors In terms of service and support, differentiated market position, provide of important and trusted information organizations need to leverage social superior service, lower operational costs on companies, products and brands in media and Web 2.0 tools to create more and attain a competitive advantage—all which they are interested. Companies robust service and support capabilities of which helps them take major strides that recognize, embrace and integrate that enable customers to interact toward high performance. social CRM into their customer- with each other as well as company facing operations for marketing, sales representatives to find solutions to and service are better positioned to their issues quickly and easily. Robust simultaneously improve their consumer customer forums, powered by passionate relationships while reducing the cost of customers who are appropriately marketing, selling and delivering service. incented and rewarded by the enterprise, are especially critical to making these Retweet The New Frontier of Marketing Sales and Service | 12
  • 13. About the Authors About Accenture Todd R. Wagner is a senior executive Accenture is a global management leading Accenture's Management consulting, technology services and Consulting CRM practice for outsourcing company, with more than Communications and High Tech in North 176,000 people serving clients in America. He specializes in customer more than 120 countries. Combining experience strategy and operations unparalleled experience, comprehensive across marketing, sales and service capabilities across all industries and for enterprise and consumer facing business functions, and extensive technology companies. He can be reached research on the world’s most successful at todd.r.wagner@accenture.com. companies, Accenture collaborates with clients to help them become Joe Hughes is a senior executive in high-performance businesses and Accenture’s Global Systems Integration governments. The company generated practice and leads the Global Customer net revenues of US$21.58 billion for the Service and Support and Integrated fiscal year ended Aug. 31, 2009. Its home Desktop Offerings for Accenture's page is www.accenture.com. Electronics and High Tech industry group. Joe specializes in Voice of the Customer analysis and the service applications of Social CRM. He can be reached at joseph.p.hughes@accenture.com. Copyright © 2010 Accenture All rights reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. This document makes reference to trademarks that may be owned by others. The use of such trademarks is not an assertion of ownership of such trademarks by Accenture and is not intended to represent or imply the existence of an association between Accenture and the lawful owners of such trademarks. This document is produced by consultants at Accenture as general guidance. It is not intended to provide specific advice on your circumstances. If you require advice or further details on any matters referred to, please contact your Accenture representative. Retweet The New Frontier of Marketing Sales and Service | 13