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I didn’t realize it until this week, but there still seems to be some confusion about Social CRM in certain business circles. Let’s fix that right now.

(Before you get too excited, Social Media ROI: Managing and Measuring Social Media Efforts in Your Organization won’t be followed by Social CRM: The Complete Guide to the Obvious. We can take care of this right here and without the need for another 299 pages of examples and how-tos.)

This is how the discussion started: Neville Hobson (@jangles on Twitter) asked Edelman Digital’s Chuck Hemann (@chuckhemann) and I what we thought of Esteban Kolsky’s (@ekolsky) definition of Social CRM yesterday. The definition, as it appears below, comes from this piece on Neville’s blog, dated 9 May 2011, following Luke Brynley-Jones‘ Social CRM 2011 event in London:

[…] The closest best definition on the day came from  Esteban Kolsky in his presentation on “Three Reasons You Will Do Social CRM”:

[Social] CRM is a philosophy and a business strategy, supported by a system and a technology, designed to improve human interaction in a business environment.

It’s a start. A good start, even, but while I don’t disagree with the definition completely (and here I must apologize to Esteban for what follows), it misses the mark twice:

First, CRM is neither a philosophy nor a business strategy, but a business function. CRM stands for Customer Relationship Management. (Emphasis on management: A function.) So before we do anything else, the definition should be changed to this:

[Social] CRM is a business function supported by a system and a technology, designed to improve human interaction in a business environment.

Second, the definition is far too vague about what the system and technology actually do. And because it is vague and doesn’t actually provide a clear explanation of what the technology does, it fails as a definition. We have to go a little further if we want to make it work.

Let’s begin with the last part and maybe we can find a way to whip it into something more helpful: “Designed to improve human interaction in a business environment.” What does that mean? The telephone is designed to improve human interactions in a business environment. So are email and memos. Faxes, IMs, SMS, blogs, video-conferencing and high tech conference rooms and work spaces all perform the same function. What differentiates SCRM from any other collaboration tool? is it even a collaboration tool?

You see how already, something crucial is missing.

If we want to look at the definition of SCRM in the context of company-customer relations, then we must include that element in the definition. Let’s see what that looks like:

[Social] CRM is a business function supported by a system and a technology, designed to improve human interaction between companies and consumers in a business environment.

Okay, that’s a little better. But we still aren’t there. We’ve established that CRM is a business function. We don’t need the final four words of the definition. In fact, they are incorrect as the expansion of CRM into the social space blurs the line between business environments and non-business environments. Our definition now becomes:

[Social] CRM is a business function supported by a system and a technology, designed to improve human interaction between companies and consumers.

Now we are getting somewhere. The definition is far less vague than it was before. We are starting to see what the aim of CRM is… but it still isn’t entirely clear, is it. What kinds of human interactions are we talking about? Is SCRM a customer service tool? A technical support tool? A marketing tool? What sets it apart from communications tools, which also improve human interactions between companies and customers?

We need to dig deeper.

Let’s start with the obvious: What is the difference between CRM and SCRM?

CRM collects data on consumers so that customer service reps and salespeople can look up their purchase history, billing history, complaint history, and any other information pertaining to their interactions with your company. It allows you to serve them better when they call with a question or problem, and it also allows you to better target them when the marketing department cranks up the budget furnaces. That’s what CRM does. It focuses on what consumers do with your company and allows you to use that information.

Social CRM (SCRM) aims to bring a whole new data set to traditional CRM by linking customers’ social data to their transaction data. What does that mean? Well, it means is that in addition to what traditional CRM tells you about these customers, SCRM also adds what they do outside of their relationship with your company: Where they go, what they like, what they share, what they search for, what they talk about, etc. by collecting that data from social networking platforms like Twitter, Facebook, blogs, YouTube, Foursquare and many more.

Fig.1: CRM view

Fig.2: SCRM view

Social CRM takes traditionalCRM and injects it with what can be best described as lifestyle data, human data, broader cultural and behavioral data. You are no longer limited to observing your customers in a controlled environment. You can now observe them in their natural habitat and understand him better.

It also gives you insights into whether or not specific customers talk positively or negatively about you, or not at all. It allows you to map their connections and affiliations. It allows you to understand their beliefs and behaviors better. It gives context to what they do in the tiny narrow bandwidth in which you interact with them as a business. It pulls back the curtain on what makes customers tick.

What SCRM promises to do is combine customers’ transaction data (what you already had access to through your traditional CRM system) with their social/lifestyle data (which they publish to the social web). Imagine the depth of insights this will yield.

So let’s come back to our definition problem. We left things at:

[Social] CRM is a business function supported by a system and a technology, designed to improve human interaction between companies and consumers.

We need to add what we just talked about:

[Social] CRM is a business function supported by a system and a technology, designed to improve human interaction between companies and consumers by connecting customers transaction data with the lifestyle data they share online.

The “improve human interactions” piece seems redundant now. The “technology” piece might also be too complex now to rely on just one. Let’s try that again:

[Social] CRM is a business function supported by a system and technologies whose aims are to improve a company’s ability to derive insights into customer needs and behaviors by connecting their transaction data with the lifestyle data they share online.

Note that the term “transaction” here meaning more than purchases. It encompasses all interactions with the company. An email is a transaction. An order is a transaction. A customer service call is a transaction.

Depending on how well you understand the world of CRM, here is a variation of the definition:

[Social] CRM is a business function supported by a system and technologies whose aims are to improve a company’s ability to derive insights into customer needs and behaviors by adding to their transaction data the lifestyle data they share online.

Are these last two ideal definitions of SCRM? I don’t know. You tell me. All I can hope is that these two versions of the definition – still works in progress – move the ball forward a little bit, at least for now.

My other hope is that by 2013, the term SCRM becomes obsolete, and CRM has simply evolved into the richer ecosystem of data, insights and consumer interactions provided by the social web. In my mind, the sooner we stop qualifying everything in terms of “social” or not social (as if the two were still somehow separate from one another), the better things will work. For now though, the painful transition continues. Viva la revolución!

A huge thanks to Esteban Kolsky for getting things started, and for letting me rudely snatch the baton from his hand (you’re a good sport, Esteban) and to Neville Hobson and Chuck Hemann for getting the conversation started earlier this week on the Twitternets. Their wonderful blogs, respectively, are here, here, and here.

Additional reading – This short and brilliant bit from Eric Swain: http://www.social-collective.com/2010/08/10/guest-post-social-media-is-dead-long-live-social-crm/

The comment section is now yours.

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 If you haven’t already, pick up your copy of Social Media ROI: Managing and Measuring Social Media Efforts in Your Organization (Que/Pearson) at quality bookstores worldwide, or download the e-version to your favorite device. Don’t let the title fool you, it is a lot more about building social media programs for companies than it is about measuring ROI. Check out the reviews on Amazon.com.

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The danger of content-centric strategies in Social Business:

Let me preface this short post with the catalyst behind it – this article by Sarah Shearman for Marketing.co.uk: “Content key to marketing in social media says P&G exec.” Let me throw a few bits and pieces of the article your way, and we’ll get started.

Content is the best currency in social media, according to Usama Al-Qassab, e-commerce marketing and digital innovation team leader at Procter & Gamble.

Speaking at a panel debate at the Social Media World Forum today (29 March) on the role of social media in traditional marketing strategy, Al-Qassab said: “There is a lot of talk about social commerce, but the average person is not yet there yet. On sites such as Facebook, the majority of people do not go there to purchase and still prefer their traditional online retailers. In order to monetise social media, it should not be seen in isolation and needs to be integrated into the wider marketing mix. But unless you have content, there is no point. The content you deliver and the investment behind that is key, much bigger than straight media dollars.”

And this (edited for brevity):

“To grab people’s attention in social media, you need to do something amazing and to do this, [what] you need is a function of how good your product is and how human you appear. The less good your product is and the less human you appear, the more spectacular, giving and generous the thing you do as an organisation needs to be.” – John Willshire, head of innovation at PHD

“There is so much content out there that is great and excellent, [but that] does not mean anyone will be able to even see it. The only way you can get people to see things and talk about things is by giving them a big push. Everything, whether it be business cards, letterheads, the website, the TV advertising, should all drive to one specific thing you want people to do. People don’t talk about things because they think they are great, they talk about them because they think they ought to, or because other people talk about them. Popular things get more popular, as a result of being in the public eye. It is about driving the content and hoping to get additional benefits, when people start getting involved.” – Nick Butcher, global head of social media and digital innovation at ZenithOptimedia.

First, let me begin by saying that I have absolutely no problem with what is now called creative/content, or even a proper focus on it. Content is important. It helps communicate to consumers the value and advantages of buying a product or service. It makes consumers discover, desire, crave, and develop a preference for a product. Now, more than ever, content is easy to share, which ads to its value and power. Content also pulls people to websites, which is pretty damn important if you are trying to keep consumers interested and/or primed to visit websites and click on buttons. For these reasons, content is at the core of all things digital marketing, and great content is worth its weight in gold. You will get absolutely no argument from me there. All of this is true.

But here is where experienced marketing executives around the world – including pretty brilliant guys like John, Nick and Usama – fall into a common trap: Mistaking social media channels for marketing channels.

The problem is simple: Marketing professionals see the marketing opportunity in these powerful new channels – as well they should. Their reflex is to do what they know, which is to adapt their marketing thinking to the social space: shift some of their communications, strategies,creative and content to the Facebooks, Twitters and Youtubes of the moment. It’s their job after all. It’s what they know. “Push” has always worked everywhere else, therefore it will work in the social space as well. (And in spite of what social media purists claim, “push” does work quite well on social channels. Ask Dell and Old Spice, for starters.) The problem, however, is that digital social channels are not solely marketing channels. In fact, they are mostly not marketing channels. They are social channels (hence the nomenclature). As such, they favor dialog rather than monologue. Publishing content and creative might be seen as a conversation starter, but it is not in any way, shape or form a dialog. It is a monologue through and through. And there is the rub.

At the root of the confusion between social marketing and social business are two distinct operational world views:

The easiest way to illustrate the problem is – as always – with a silly picture of old white dudes in suits sitting around a table.

Below is the functional view of social media channels as perceived (and expressed) by marketing professionals like John, Nick, Usama and thousands upon thousands of others around the world, including the majority of CMOs:

The problem with a unilateral functional view of SM channels

This begins a chain reaction of tactical thinking in which “content” – whose importance to the marketing function (on and off the web) is without question – becomes the core component of marketing-driven social media programs: If “content is king” for marketing on and off the web, then content must also be king for marketing in social media channels.

Logical, right?

If you have ever wondered why “content” was such a recurring theme and point of focus in the social space – when it clearly doesn’t need to be, this is why. What you are looking at in the above image, and what you are hearing from John, Nick, Usama and their peers isn’t representative of either social business or a social media program for business. What it illustrates is limited to social media marketing: The traditional marketing function adapted and applied to social media channels. This world view reflects a belief that social media management is primarily a marketing function.

This view point is of course a little too limited to work super well in a social medium, where people value non-marketing interactions at least as much (if not a lot more) than marketing-related ones.

Since social media channels and the social space are not inherently marketing-focused channels, the correct approach for a business looking to see both short and long term results, is one that is NOT primarily marketing-centric, and therefore NOT primarily content-centric. Here is what that more integrated social business model looks like:

Social Business favors multi-functional adoption across the org

The above image reflects the nature of social business. This multi-functional approach to social media, marked by the adoption of social channels by all functions and departments across an organization, stands a much better chance of yielding results in a space that is not inherently marketing-focused (and can be, at times, openly hostile to overtly marketing-focused exploitation by companies that haven’t yet thought things through).

This model does not focus on “content” as the key component of its social media program “strategy.” Instead, the model focuses on creating new types of value for consumers and stakeholders:

1. Pragmatically this is done to gain a competitive advantage, or – because the more value an organization creates for its customers, the more win becomes associated with its reputation.

2. From the consumer side, as long as the organization driving such a program seems to be genuinely interested in improving the lives or the experience of people it comes in contact with, as long as it seems to want to foster a relationship with them that isn’t automated, that is as truly human and genuine as an old fashioned handshake or a kiss on the cheek or a warm and honest hello, this business socialization activity won’t come across as one-sided and self-serving. This is important.

Sometimes, the best marketing isn’t marketing at all. It grows out of the personal connections that happen between the impression and the purchase, the thousand little personal interactions that happen between the purchase and the coffee shop, and the bonds consumers form with human beings around them. These human beings can be fellow customers of Brand x or employees or Brand x, or perhaps future customers of Brand x. For the purposes of this piece, let’s just focus on employees of Brand x.

Thus, having your marketing department push content all day long via Facebook pages and Twitter accounts and Youtube channels basically amounts to executing a simple social media marketing strategy. It doesn’t build anything. It doesn’t stick either. It’s just marketing spend at a lower cost and with a higher content velocity. Not bad, but that won’t get you very far in the social space.

Moving beyond “social media marketing” – A short list of business functions in social media that do not require content to create value and yield results:

We have seen how Marketing, advertising and PR all tend to focus on content in and out of social channels and why. (And again, there is nothing wrong with that.) Now, let us briefly look at a few other functions that can find a profitable home in the social space that require zero content creation, publication or curation.

  • Digital Customer Service
  • Business Intelligence
  • Digital market research
  • Consumer Insights Management
  • Online Reputation Management
  • Digital keyword and sentiment monitoring
  • Digital campaign or program measurement
  • Digital crisis management
  • Community management
  • Digital technical support
  • Digital concierge services

There are more, but you get the idea. None of these are particularly “content” driven functions, are they. Yet… “content” is supposed to be at the core of social media programs, right?

An emphasis on “content” in social media and social communications is simply code for “we think of social media primarily as a marketing channel.” It clearly needs to be treated as far more than that.

Organizations whose executives come to believe that “content” is key or central to social media success, equity or potential are making a grave mistake: Content doesn’t in fact drive engagement, traction or success in social media. “Content” drives marketing and responses to marketing in social media. As important as that is, we all have to be realistic about the limits of this kind of approach.

Realistically, content doesn’t drive customer service, crisis management, reputation management or market research in social media, nor does it drive conversations about customer service, crisis management, reputation, market research or even shopping experiences about a brand in social media. Since these and other key business function are principal building blocks of every successful social media program (for business), you see how an emphasis on content can hobble an organization’s social media program right from the start if its importance is mistakenly overstated.

Content’s relation to old vs. new forms of media:

Old media was 100% about messaging and distribution. Marketing was a monologue, primarily because the media used by marketing didn’t give consumers a voice. Viewers didn’t talk back to brands through their TV. Listeners didn’t talk back to brands through their radio. Billboards, print ads, posters, point of sale displays, coupons and even Web 1.0 websites functioned the same way: You created the message and pushed it out. The channels were basically one-way pipelines with marketers at one end and consumers at the other, the latter being the receiving end.

Social media channels are very different. Dialog rules in the social space. Marketing is at best suspect, and tolerated only if it doesn’t come across as exploitation of the channel by a company. Moreover, marketing in social media is permission-based: Too much marketing, or the wrong kind, and social media denizens will disengage from an offending brand. The wrong approach in these social channels can even do more harm than good for a company that forgets to treat consumers like individual human beings.

Though occasional monologues and messaging can find their place in the social space within a healthy mix of engagement activity, an operational emphasis on any kind of marketing monologue doesn’t work. Put simply, companies need to stop shoving “content” through social media channels like sh*t through a goose for ten seconds, take a step back, and start placing as much – if not more – emphasis on listening to consumers in order to then respond to them and begin a process of socialization. That is at the core of true engagement, and the fuel that will drive companies’ loyalty engines in the social space. The recent emphasis on content creation and publishing isn’t helping companies engage better. Instead, it is creating a wedge between brands and consumers. A wall of noise, even. It has become terribly counterproductive.

Two more things to think about:

1. Engagement and buzz are not the same thing. Pushing content through social media channels to generate buzz is perfectly fine and it can work very well. But don’t kid yourselves: Generating buzz around content or a campaign isn’t engagement. Not by a long shot. So next time someone tries to tell you that content and engagement go hand in hand, ask them to explain the difference between engagement and buzz. Chances are that they have the two mixed up. (Beware: That kind of confusion can send organizations down the wrong road fast.)

2. Saying hello or thank you doesn’t qualify as content. By the same token, having a conversation with someone is not content creation or curation. Responding to customer service requests via twitter is not content either. In fact, the more your communications resemble a conversation or dialogue, the less your communications qualify as “content.” The flip side of this is that the more focused an organization is on content when it comes to its social media presence, the more anti-social it will appear to be.

Strike for a balance. Always. The social space is far too complex and filled with opportunities to put all of your operational eggs in one basket – even the one tagged “content.”

Cheers,

Olivier

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Social Media ROI: In stores now. Available in print and e-formats. (Click here for a sample chapter.)

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