Just What is Social CRM?

Is social CRM a product category or a collection of strategies that social media consultants and analysts are pushing? That is the question I have been spending much time considering as of late.

Clearly there are product components, most notably the customer community pieces that vendors like Get Satisfaction and UserVoice are offering (notice the Feedback widget to the left, I started my own VC community on Get Satisfaction!). There are many analytics and monitoring tools, on the latter there are at last count over 100 products in the social media monitoring business. The core customer community offerings take over where forums and wikis stop, and in the case of forums I can’t imagine a traditional product category more primed to be wiped out than this one.

The analytics pieces are much more complicated because they attempt to analyze social graphs to derive authority and reputation, with the ultimate goal of identifying fans, friends and followers who are acting as unpaid promoters of your products and services. Among many outcomes for analytics, perhaps no measure is more important than raising your company’s net promoter score (NPS), which is in simplistic terms a measure of the potential word of mouth advantage you enjoy in the marketplace. Lithium says they have deep analytics capabilities but whenever I read their stuff I get a headache, it’s pretty big brain stuff and not entirely clear what it does for me beyond discerning authority in my brand’s social graph.

Ideation is an interesting set of features that are often embedded into social CRM products, in a nutshell these are idea submission and voting components that crowdsource product ideas. I’m on the fence about the value of ideation as a product category but only because it’s a seems like a bandaid for a bigger problem that companies often have which is that they do not understand their customers well, however it could equally be argued that the entire point of social CRM is to better understand your customers. A number of companies are offering ideation, from IdeaScale to Salesforce Ideas.

Consumer product and services companies are concerned about review and rating sites but my intuition tells me that the market has compartmentalized review sites. What I mean by that is that there are two aspects to review sites that cause us pause, the first being the integrity of the site in light of the well publicized controversies around Yelp but maybe that’s an inside baseball thing that the broader market isn’t concerned with. The second issue is a big one and it’s structural, which is how do I know the people who are reviewing products and services care about the same things that I care about… in other words are they like me?

The issue of affinity, which is the ability of a review site to group me with other people who are like me and offer reviews tailored to their likes and dislikes is a very interesting one to consider. I organize the concepts of identity, reputation, and affinity like this:

- Identity are my attributes.

- Reputation is what other people think about me (my authority).

- Affinity is my relationship to other people who are like me and our collective relationship to other groups.

As it relates to social CRM strategies that any company is employing to target messaging and promotion to their marketplace these definitions are incredibly important. Companies have employed identity based targeting for decades, it’s called demographics and to some degree pyschographics, and while it’s tempting to say that these are affinity group techniques the fact is that they are not because in social CRM the notion of affinity and reputation are intertwined. Forward thinking companies have moved beyond demographics and are attempting, with the help of social CRM tools, to accommodate reputation in their interaction strategies but the whole notion of affinity is a wide open opportunity.

As it relates to review sites I’m not sure that these remain as relevant and valuable in the years ahead as we have assumed them to be in recent years. However, they are not going anywhere and some interesting products like Huddler are offering to integrate them along with wikis and other user generated content forms.

Q&A sites are hot, I’m particularly impressed with Quora and see much potential for this as a valuable augmentation to social CRM suites. Fixya is another site that is Q&A organized for the purpose of technical support, and it’s probably only a matter of time before offerings like this are integrated into service and support ticketing applications like Zendesk and Parature. The service and support vertical is about $3b a year just in the U.S. so integration and extension of traditional CRM with these newer offerings as well as outright replacement in some cases is an attractive market scenario.

I have touched on a number of related market segments and companies however by no means have I provided a comprehensive look at the market, for that I would suggest you get Altimeter’s Social CRM report which does a good job of laying out the market.

Lastly, one thing that is very clear to me is that social CRM is an extension of two very large markets, the enterprise collaboration and content market and the CRM market. Successful social CRM products and services will co-exist with these markets and not attempt to displace them, although for some companies it may make more sense to eschew the traditional CRM suite offerings for best of breed with light integration.

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