Let’s catch on few basics about ‘Social CRM’ (An extension of CRM Landscape) & its Emergence

September 15, 2014 Published by:

Social CRM Basics

As we all know Change is a continuous process and our world has changed a lot in the near past, is changing presently at a much faster pace and will keep changing over time. Social Media has been continuously evolving since the inception of Web 2.0. Web 2.0 can be referred to as the changing trends in how we perceive the Web, World and web technology in today’s time. Web 2.0 has been the perpetrator in increasing collaboration, community creation, conversation and creativity and the overall communication channel. It has changed the WEB from READ to WRITE WEB, which caused emergence of social relationship management aka social customer relationship management aka SCRM or Social CRM.

This entire Change had a great impact on the CRM landscape as it today:

  • Stimulated changes in the consumer behavior, the customers now
      • Extensively make use of new communication tools & channels.
      • Expanded their landscape by taking advice and getting influenced from the online community, from both acquaintances and strangers.
      • Makes greater online purchases as compared to earlier.
      • Proactively share ‘feedback’ with the online community
      • Expect higher Customer Experience and faster response to complaints.
      • Study of Reviews & Ratings before purchases.
      • Posting & Sharing Reviews and Ratings based on experience.
  • Expanded the scope of the ‘R’ in CRM from merely Company-Customer (and Company-Partner) Relationship to a more complex relationship network involving
      • Customer – Customer
      • Company – Competitor
      • Company – Company
      • Customer – Partner
      • Customer – Competitor
      • Partner – Competitor
  • Triggered the evolution of traditional CRM to a more vast landscape where the focus shifted from individual relationships to collaborative relationships generated from multiple connections.
  • Actually created an environment for generating more data/information about the customer (customer behavior) beyond the earlier set walls.
  • Allowed customers and 3rd party websites (Social Networking portals) to own and hold the valuable data about customers, products, and potential customers. Earlier held only by the company.
  • Enhanced the view of traditional CRM from a controlled environment, having merely data on transaction history, complaints, phone calls and emails to an open un-controlled environment, having data about lifestyle, culture, demographics and behavioral trends of consumer in their natural eco-system.

Now let us start looking into the term “Social Customer Relationship Management” in view of the changes observed into the CRM landscape caused by the emergence of Web 2.0. The term “Social Relationship Management”:

Let’s now see how the definitions of “Social Customer Relationship Management” go and in a way will try to know what SCRM is all about?

  • Definition of Social CRM given by Paul Greenberg, “A philosophy and a business strategy, supported by a technology platform, business rules, workflow, process, and social characteristics, designed to engage the customer in a collaborative conversation in order to provide mutually beneficial value in a trusted and transparent business environment. Social CRM is the company’s response to the customer’s ownership of the conversation.”
  • Another definition of Social CRM: It 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.
  • Another way of defining Social CRM resembling above one: 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.
  • A simpler definition of SCRM: SCRM involves the activity of building, maintaining, strengthening and broadening personal-business relationship with relevant people.

Having learnt the reasons that created need for the SCRM we can now look into how actually Social CRM may impact an organization:

  • Social CRM does not replace the CRM 1.0 (traditional CRM) in any organization instead it enhances its scope and extends capabilities of CRM 1.0.
  • Social CRM projects the company in a more humanized way and thus changing the perception of the customer to see the company as peer and thereby enhancing trust element.
  • Social CRM prompts companies in making strategies that are customer centric.
  • Social CRM enables the evolution of organizational mindset and it affects its entire operations, its value chain and its organizational structure.
  • Social CRM enhances possibilities in an organization of bringing innovation from all the employees rather than bringing it from an internal specialized core group only. This leads to a customer-centric innovation cycle as all the employees are connected closely with customers via web 2.0.

How Social CRM works? – Let us try to understand taking an example.

How Social CRM works

Now let us see what are the benefits of Social CRM?

Social CRM Solution ArchitectureSocial CRM Solution Architecture

SCRM or Social CRM has opened the gates to a whole new world of possibilities for the consumer and companies to interact, be informed and take decisions based on the natural behavior rather than the controlled or limited scope of earlier times.