Ensuring a successful relationship, through communication and collaboration embodying a value based approach in order to win business.

Modern business demands that we are able to maximise value to our customers; we achieve this through our relationship and by building a partnership. Customer relationship management (CRM) has long been on the agenda for business growth – yet to many this is merely an IT system rather than a way of life for the organisation. With Social Media there is a need for a more holistic customer relationship management process. We talk to customers and prospects, we address their concerns while building a relationship with them in a public forum. The relationship we build is not one-to-one, it is based on the needs of one individual but is is visible to a much broader audience (in fact it can be visible to the entire world).

There is an old maxim that we hold out friends close and our enemies even closer. In Social Media Land it is important to build relationships with your customers and with prospects alike – the reasons are obvious; because we wish to do business with them. We also need to build relationships with competitors – why? to know what they are saying and doing of course. Then there are a wealth of other people that we need to build relationships with, including researchers, writers, industry experts, shipping companies, suppliers, etc, etc. Social Media impacts them all.

Ultimately there is a sphere of influence that extends beyond the organisation, its staff, its suppliers, its customers. This must by its public nature extend to the industry at large; it is like everything that we do being published in a trade journal for all to see. That sphere of influence is becoming increasingly visible and our competitors are already leveraging it to their advantage.

Generally we would all like to think that improving our visibility is good, we all want that – it drives in business. Dell Computer has stated that it expects to have sales of over $6 million through its activity in Social Media channels in 2010. This level of sales comes about through a commitment to Social Media that operates across the company. It comes from answering marketplace questions about Windows, PC faults etc. Dell takes an approach that ensure responses are made by people with the real knowledge – it is more likely to be the product designer than a marketing person because they do not want a ‘marketing spin’ put on the story. The response must be focused, accurate and deliver knowledge to the person needing it. This delivers VALUE to the customer, or prospect.

This dialogue wins friends in the marketplace, not only is the person with the problem impressed that a mega-corporation took the time to respond, but they did so in a timely and accurate manner, even when the question related to another company’s product. For Dell this pays dividends because that person will add the company to their shortlist when they are looking for a new product that Dell sells – Dell will be on the shortlist. The other aspect about this dialogue is that it is public and clearly visible to other people encountering the similar questions, yet have not put finger to keyboard to ask the question.

Yet there is also a negative side to all of this visibility: our failings can be seen by all as well. Again though this needs to be managed in an open and honest way. Businesses are driven by people and as we all know people do make mistakes. Our faults must be managed, business needs an intelligent intervention in the Social Media space to understand what is being said about our brands and to respond appropriately.

BUT Surely the reason I want my business to be using Social Media is to sell more products?

Yes, that is true. Yet moving traditional ‘push-based’ marketing techniques into the Social Media space meets with only limited success. Your business can advertise on Social Media sites, it can even focus the advertising to appeal to specific audiences, but remember more than ever before people have learned to tune-out advertising on web sites – because they have a purpose, a goal, and responding to that advert no matter how compelling will mean they delay or do not reach their goal. Involvement in Social Media means more than simply advertising, it means being involved. Through this general introduction to relationship based business it should be clear that the key elements are:

☼ Improving the way we communicate and collaborate

☼ Intelligently intervening in the marketplace

☼ Through this building a revenue stream

Obviously revenue is important, we could not survive long in business without it. These three elements are closely bound together in a relationship based business. Part of selling is providing a solution for other people’s problems. We are better able to provide solutions by understanding those problems; listening; asking questions; building relationships; envisioning solutions. This is at the heart of a social media engagement and building a market intelligence which can be leveraged to build the business.

It may be that building sales through trusted relationship takes a longer sales cycle, but yet people may also be lining up at your door because of your Social Media intervention. Some sales take more patience than others but then you are adding value through every communication in an holistic way. One of the longer term results will be increasing customer loyalty around specific products – something that has been lacking of late in certain industry sectors. In fact brand loyalty can be put back on the agenda through correct use of Social Media.

There are a great deal of so-called ‘Social Media Marketing experts’ talking on this subject on a daily basis. Yet the majority of these are marketing people who are simply advising businesses on how to leverage Social Media sites as a tool for traditional advertising.

Now, I am not against leveraging the channel as an advertising mechanism, but it is only a tiny part in leveraging the Social Media Channel for business success. I have been giving some recent seminars on this topic in the Toronto area and wanted to take this opportunity to share with my web based community. I have carried out a lot of investigation of how businesses successfully leverage the power on Social Media. I have discovered that there are 3 key components:

◊ Collaboration

◊ Intervention

◊ Revenue Generation

Some marketing specialists think only in terms of generating in income from this channel, but this approach will not ultimately lead to success. So lets look at each of these in turn

Collaboration

Here is one of the slides that I have been using to talk about Collaboration.

In the past collaboration has been about reaching out via email, we often forget to involve all the knowledge-holders within our own organisation, let alone with suppliers, customers etc. Collaborative efforts have been based on team membership.

The challenge today is to involve a wider audience, including suppliers, customers, and other partners we are able to improve the level of communication and take appropriate action. Understanding that a customer’s business is closing early on Wednesday for a corporate event and keeping the trucking partner in the loop will ensure that deliveries are re-scheduled and arrive at an appropriate time for processing. I include Industry Experts as a category here to relay what IT has done for a long time. Don’t know the answer to a problem – look it up on-line or find an expert. Social media is bringing those experts closer to us as a normal reource.

My earlier article “Invest On Relationships” discusses the value to be gained from improving collaboration within the workplace. Everyone has competencies they bring with them from either their social life or prior workplace. Every person has an associated sphere of collaboration, starting with themselves, they can expand that by working with other people. This builds through teams, their department to the company as a whole. Each step of this process potentially adding expertise. Ultimately our individual spheres of influence touch customers and suppliers, they may also touch various third party partners like the haulage company with whom we are able to build a trusting relationship over time.

Intervention

When people are talking about your brand your finger needs to be right on the pulse! The response needs to be immediate, proportionate and relevant.

Remember that Googling your brand or company should show your web-site to the top of the search results, but it is unlikely to show what someone just said about you on Twitter. Using traditional search engines it takes time and a lot of effort to discover what was said yesterday. A negative blog may take months to discover via traditional search.

A person who starts a hate campaign against your product or company needs to be placated before the press come knocking on the door.

Social Media Intelligence is about knowing what is being said about our product and having a plan to respond proportionately in any given situation. The triggers are questions about ‘What is being said about my organisation, my product, my competitors?’ To a large extent these are traditional market research questions, but we have never before had such a powerful view about people’s thinking. I think that Social Media can go way beyond that level of thinking because it is driven by what is important to people.

In addition we can link this general knowledge with a knowledge of the views of our customers, if we retain social media ID’s of our customers when they make on-line comments. This information is closely allied to marketing intelligence.

Monitoring solutions are available that will automatically monitor the internet buzz and throw up an alert when action need to be taken. Rewarding recommendations is a key part of this approach. What do you do when an independent person spontaneously says something good about your product and company? At the very least it is important to thank them, one  airline thanked a customer by giving a 25% discount on flights because of something said on Twitter.

Helping people with their problems is one of the best ways of intervening. E.g. solving someone’s PC problem will win you kudos, even if the person does not use your product right now. What happens next time they are looking to buy a new computer? Of-course you will be very high on their wish list, if not the only candidate. Dell knows this, it is one of the reasons their Twitter account will answer a multitude of Windows and PC related questions – to develop a trusting relationship.

Revenue Generation

As I said before some marketing specialists think only in terms of generating in income from the Social Media channel. I have placed this deliberately at the end of this article, because real revenue will come as a result of doing the other things right.

Advertising on the Social Media channel will an income at the same rate as general advertising on the Internet. We may be able to tweak this a few points by focusing our advertising on the specific demographic group that we are interested in. At the end of the day the Social Media channel is based in trust and expertise. Leveraging this channel requires a big shift in entrenched thinking. This is where a corporation’s ability to leverage the Social Media channel to collaborate and intervene becomes important. This builds trust and proves expertise in specific areas.

A prospective customer who has found you through a specific Social Media is interested in the services that you have to offer, they will come to you because they already trust you and they are interested in your product. Hey isn’t this better than Yellow Pages?

The ROI of Social Media

Social Media can be viewed by many as the current must-have, but at what cost to the corporation? Are corporations setting aside the ROI in order to jump start their enterprise social media presence?

I have heard it said that it is not possible to identify an ROI for collaboration improvements and that we only see the real improvements in the rear-view mirror. Yet when I look back over my IT career this has frequently been stated for any systems implementation. Defining an ROI for any proposed solution is about producing a best estimat at the time the need is perceived. That is as relevant for any Social Media implementation as it is for any other corporate change. Remember here the major impact of social medial is more in the area of business than with the technology that underpins it.

The other aspect here is about contributing to an improvement in business results. This should be measurable through the Business Intelligence (BI) solution. We are seeking to measure the contribution made by Social Media to the bottom line. This must include a value for the collaborative effort, and for our web intervention (including the real value from promotions offered).

Spending needs to be appropriate, but will always be based on business drivers.

Related Articles:

“Invest On Relationships” by Peter B. Giblett

“Realizing Value from Social Networks: A Life Cycle Model” by The Global Human Capital Journal

“Feeling the Fear” by Elizabeth Bennet

“Don’t Set Aside the ROI in Building your Social Media Solution” By Peter B. Giblett