Business has come a long way from the mom-and-pop stores of yore to a wide and comprehensive system that involves marketing and sales. Customer satisfaction has assumed great importance during the past decades. Where businesses were simply focused on manufacturing a product and advertising it, today they are more concerned with whether the product meets the expectations of the customer. CRM or Customer Relationship Management is a result of this concern. CRM first originated as a database marketing tool engineered by Kate and Robert Kestnbaum. The Kestnbaums collected customer data, stored it in a database, and analysed it statistically (www.crmswitch.com). From there CRM has evolved into marketable software that helps businesses manage their customers.
With the emergence and popularity of social media, businesspersons began using it to promote sales. Social CRM is an emerging branch of CRM. It is described as the strategy that businesses use to engage their customers. Social CRM (SCRM) uses social media like Facebook and Twitter, to inform the customers about their products and services (PGreenblog, 2009). The difference between CRM and SCRM lies not just in the use of social media. There is also a difference in the way the company talks to the customers. SCRM has been described as the company’s response to the queries of the customer (PGreenblog, 2009). CRM is about managing customers whereas SCRM is about engaging the customers. SCRM opens a channel for communication between the customers and the company.
Need For Social CRM
The contemporary customer is outspoken. Social media, where the customers’ thoughts are written rather than spoken, offers the customer a safe outlet for his feelings. Therefore, he does not hesitate or hold back his criticism of products and services. The new genre of customers have control over their conversations with the company. The company merely responds to the comments of the customers on social media. According to the Huffington post, 89% of GenX and 79% of GenY customers are active on social media. Even among the boomers, 72% are active participants (huffingtonpost.com). With the increasing internet presence and use of technology in business, these customers who make up a large part of the customer base, can make or break the company. It is therefore critical for companies to participate in Social CRM.
Social CRM Strategy
Customers on social media often become long term customers because of a healthy relationship developed with the company. It is therefore important for companies to strategize carefully, their responses to posts on social media. These responses serve as personal communication and personalized attention that the customers consider their right. Special discounts, tailor made deals, coupons, trouble compensation tickets and appreciation for suggestions all comprise the responses to customers’ posts. Talking about SCRM, Carolyn Baird, global research leader at IBMIBV says that companies should “deliver tangible value in return for a customer’s time, attention, endorsement and data.”
Social CRM which may be dubbed SCRM is the emerging business strategy in response to the increasing use of technology in general and social media in particular. SCRM is evolving as a specialized area of business strategy, marketing, and CRM. SCRM involves not merely managing customers but engaging them in conversation and turning social media customers into loyal customers. With proper strategy and management of SCRM, businesses stand to gain in terms of customer satisfaction and therefore improve profitability.