Wednesday, August 17, 2011

Social Media and CRM

I am pretty late to the blogosphere about the differences between social media and CRM. But in customer meetings I see this kind of confusion all the time. So here goes. Oh, and since I mainly work in the travel industry, my examples come from there.

So first what are the goals of CRM? Knowing the customer. Being able to have enough insight into the customer to persuade the customer to buy more, become more intimate - generally increase their direct value. Maybe to right wrongs - by providing compensation if bad things happen. So CRM tends to foster a set of 1:1 exchanges. Necessary but not sufficient.

In contrast social media is about somehow leveraging an network of relationships. It's one stage on from CRM (or maybe many stages beyond CRM!). So if I have a bad experience on an airline, I need the airline to do what t needs to do for compensation. But the social aspect doesn't stop there. I am heavily armed with well connected devices, a network of acquaintances and friends and time - especially on the flight. So in some ways the Social Network space is a competition between the airline provider, and the customer. Rach trying to get "the story" out to their social network orbits. The magic happens when the stories coincide - when the CRM aspect of looking after me is also told by the airline and by me. The double dip of great publicity.

But when things go badly for a customer (e.g. my luggage misconnected) then the bad story needs to be acknowledged. Through the social channels - posting on the passenger's FB wall for example, and some compensation placed at the same time. Otherwise the annoyed passenger with lots of time will send out a stream of invective to any/all who may listen.

So when thinking about Social Media realize:
  • It's a conversation
  • It's about the whole orbit
  • Don't forget to do CRM blocking and tackling