Social networking to boost your business
Thu 15 January 2009 - 2:19 pmGrowing | Marketing
While bosses across the country are banning their staff from using Facebook and other social networking sites in their lunchbreak, are they losing sight of what could be a potentially beneficial business tool?
Business managers today are only too aware of the importance of looking after their customers and gaining their trust. Unfortunately many customer relationship management (CRM) tools today ignore the core driver of customer management success. Instead of engaging in relationships, current CRM systems could be better described as CTM: customer transaction management.
With CTM, companies interact with customers in a narrow, impersonal and highly prescribed way that focuses primarily on the exchange of data, not the interaction with customers. These tools and technologies may assist with logging and tracking interactions but they have very little to do with relationships.
Companies need to develop a deeper relationship with customers. However, emphasising the relationship aspect in CRM requires changes. Whether it’s in the IT department, the online sales process, or in other marketing channels, organisations need to commit to become more open and transparent to their customers. This means giving customers an independent voice in the relationship. It also requires adopting new technologies to enable a richer interaction, including technologies that many employees already use on their home computers such as web 2.0. This can include blogs, instant messaging and social networking websites.
Unfortunately, many companies are hesitant to adjust their strategies and technologies to improve customer interactions, foster deeper relationships and build brand loyalty.
The Australian landscape
Customer loyalty remains one of the holy grails of business. It leads to lower customer acquisition costs and improved customer retention. It drives increased profitability as loyal customers increase their spending. It acts as a strong motivator behind continued investment in CRM and business intelligence technologies.
Yet, even with these and other advances, it’s unlikely that enterprises will achieve their goals for establishing customer relationships and loyalty, especially if they follow the approaches behind many of today’s customer-centric initiatives to date. A good customer relationship exemplifies the same qualities as a personal relationship. It includes each party having a platform to voice opinions and thoughts using both structured and unstructured communications methods. Offering such a platform can increase the average value of a transaction, whilst reducing customer service costs, empowering employees and streamlining processes. These offer important capabilities for any business.
A recent global survey conducted by an independent market research firm and commissioned by Avanade, interviewed more than 500 executives at the largest companies in each country (80 in Asia Pacific) about attitudes and barriers to using tools of social media for both internal communication and customer relationship management. Although results suggested Australian companies are ahead of the game when it comes to using tools such as online chat to receive IT support, it highlighted that Australian businesses are still reluctant to unlock the full potential of social media. The survey also showed that companies know social networking is slowly becoming a reality in the workplace, but most have no plans to handle it, primarily because of apathy at the executive level.
Web 2.0 technologies
Today’s businesses give customers little voice in how they can interact, even for the most highly-valued customers. They find themselves routed through a voice response system to a queue for their particular problem or query. They find few, if any, ways to express their preferences or impact how they are serviced. However, that doesn’t have to be the case.
For example, what if customers found out the profiles of an organisation’s customer service representatives and ratings from other customers? Imagine if they could choose a representative based on a profile, taking into consideration the wait time involved. Customers could make informed choices about whether to be served by the next available service agent or wait for a particular agent with favorable survey ratings for, or expertise in, resolving problems like theirs. Giving preferred customers this type of information, along with the ability to act on it across multiple contact channels such as phone, email, web and chat, empowers them to contribute to the development of a more advanced, valued relationship.
There are numerous reasons why businesses should be active in learning about new forms of media. Although Australia is leading the Asia Pacific region when it comes to early adoption of Web 2.0 technology, many senior executives are still concerned that social networking will sap their productivity and put their businesses at risk. However social media won’t just disappear if it’s ignored. Social media has tremendous potential that Australian companies need to harness to stay competitive or they will risk losing customers and employees. Risks and concerns can be managed, but businesses must actively take part in its use in order to stay in control.
Businesses can apply Web 2.0 social networking and related technologies to a variety of CRM-related situations. They include customer contact centres, online marketing and direct sales. For example, sales executives can take advantage of Facebook, Myspace, Twitter etc. and use them to maintain relationships with their customers, even during periods when those customers aren’t making purchases.