11 February 2013

Misconceptions on the role for Social in CRM

As a practice, Customer Relationship Management (CRM)  is simple in concept but  complex to pull off well.

In it's simplistic view,  CRM is about aiming to build the kind of relationship a neighbourhood grocer would have with regular buyers, except it needs to be operational at Scale. Technology, Business Rules & Services - Databases, Marketing Automation, IVRs, Mobile Apps, Rewards, Call Centres, Analytics - to name a few, are necessary to make this CRM vision a reality.  A good CRM strategy - one that really attracts & influences loyal behaviours - is complex to architect,  implement and even more to operationalise without glitches. But when it comes together, it's works like a charm to nurture and attract mutually beneficial relationships.

Which is why I find it baffling when the term "Social CRM" is thrown around loosely as a modern substitute for anything & everything "CRM." I disagree.

Yes, branded Social Channels offer lots of options for brands to reach out, engage, influence and help spread the word. But IMO they are best suited to:
  1. Getting conversational with prospects
  2. Driving light buying
  3. Showcasing excellent customer service / customers belief in the brand - to influence prospects 
Beyond this, Social platforms are weak in their capabilities to set up & deliver personalised CRM communications. The crucial phase of the relationship - moving light users to increase portfolio or frequency - is still best nurtured via complementing personal CRM channels - e.g email, mobile, direct mail etc... 

It's been proven, time and again, gains in market share for brands comes first through increasing popularity,  i.e by gaining more buyers  of all types, most of whom are light  and buy occasionally. Branded Social channels can play this role, whilst more private channels  work to complement. So while Social is not a substitute for everything CRM, as yet, it can work wonderfully well if its role in the mix is defined well at planning, taking into account it's limitations.