The emergence of social media has dramatically changed how companies interact with customers. Customers now get product information and support from other consumers through social media instead of directly from companies. To take advantage of these new communication channels, companies should adopt a "social CRM" strategy to engage with influential customers on social media, understand customer needs through analytics, and provide support across multiple channels. If implemented correctly, social CRM allows companies to better connect with customers at lower costs and gain a competitive advantage over other businesses.

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
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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
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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."
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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
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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.
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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
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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
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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
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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
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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
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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
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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.
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Accenture as general guidance. It is not intended
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If you require advice or further details on
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