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Social Networking as the Scarcrow of CRM: If I only had a brain.

by Michael Maoz  |  May 14, 2009  |  3 Comments

The Wall Street Journal is running a lead story in the Marketplace section that “Businesses Quit Slashing IT Budgets.” That brought me back to the subject of an earlier post: are you overspending, underspending or correctly spending on you web presence?

The issue is that there is no “you” out there. I come from a background in customer service contact centers. Customer service managers, because they are often (and historically almost always) viewed as a cost center, know right down to the last drachma what their operation is costing them. You can’t even take a cup of coffee that they haven’t calculated. They can rattle off the cost of communications, infrastructure (PC, network, headsets, furniture, real estate), labor, packaged software, IVR, ACD, CTI. These cats have sharp claws. Now go over to the website. Here we have bloviation: ‘it depends what you want to include’ or ‘my budget for the web is’ or ‘that part is our agency budget.’ There just isn’t a single individual who stands up with all of the facts and success metrics.

Website planning and budgeting is like Napolean’s Grande Armee trying to take Russia. Bravado, resources, more resources – but somehow the pieces never came together. For your business, your customers and prospects are what will wear you down in the end. And into this mess comes your social networking efforts. You should be subscribing to our research to read the incredible depth of work we have from colleagues like Nikos Drakos, Adam Sarner, and Gene Alvarez, but here is the nut of it: most groups building social networks have no really good business case for what they are doing. Let’s get a blog going! Hurray. Let’s get our clients to post 23,585 ideas on our website and then we’ll commit 18 full time resources to see if there really might be a pony in all of this…. stuff.

I know, many of you in the west loved the Scarecrow in the Wizard of Oz. Very sweet, very well intentioned. But he was so easy to just light on fire. Luckily he had friends to protect him. Who are your friends to protect you from building elaborate social networking capabilities but no idea how that will help better market your products? Win new customers? Serve existing customers better? Drive new revenue? And deliver clear answers on the cost/benefit of your efforts?

It’s coming – there will be a person in your organization who eventually owns your website, and it will be measured on how customer-centric it is. Maybe you want to get ready with good data to support what you’re doing.

Category: crm  customer-centric-web  innovation-and-customer-experience  

Michael Maoz
VP Distinguished Analyst
13 years at Gartner
26 years IT industry

Michael Maoz is a research vice president and distinguished analyst in Gartner Research. His research focuses on CRM and customer-centric Web strategies. Mr. Maoz is the research leader for both the customer service and support strategies area and customer-centric Web… Read Full Bio

Thoughts on Social Networking as the Scarcrow of CRM: If I only had a brain.

  1. Michael,

    Excellent thought-provoking post. Well said. There is actually one part that I will take to task here. I agree with everything you write except for the part where 18 resources (or any resources) are dedicated. This is one of the two causes for the failure. There are no resources allocated beyond the initial deployment. Maybe one person who takes on it because they think it is fun or interesting, but usually they are not paid or allocated to the project.

    Of course, you allude to the second reason for the failure: lack of strategy. Even having an idea why they are doing as opposed to “if Oprah and Ashton are doing it, we have to be there”. There is a complex process of ensuring that you have a reason and that whatever you do is folded back into your customer experience, customer service – even CRM strategies. Else, you are creating another silo — and we all know how well those work.

  2. Cheryl H says:

    The wizard of oz reference truly made my day. Thanks! I do agree with complete lack of forethought that is going on with business just jumping on the social network bandwagon. As a previous poster stated Oprah, who is a true marketing genius, tweets so it must be great for business right? It can be a very complex process and a timesink if not done properly, businesses need to take the time to research these social networking websites before placing all of their eggs into this particular basket. On the flip side however, if it is done properly with a well excuted strategy, social networking can be the business equivalent of winning the lottery.

  3. “Let’s get our clients to post 23,585 ideas on our website and then we’ll commit 18 full time resources to see if there really might be a pony in all of this…. stuff.” Great quote! Social networking can bee a huge boon if done properly. The most important part of a social media campaign is to have a strategy BEFORE you start instead of jumping in and hoping for the best.

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