High Priority

Is Social CRM a Byproduct of Business Ignorance?

By Erik Linask, Group Editorial Director  |  January 01, 2011

This article originally appeared in the January 2011 issue of Customer Interaction Solutions Magazine

Business success equates to the ability to excel at customer service and at worst, meeting customer expectations while, at best, exceeding them. Of course, in order to accomplish that feat, businesses must be aware of customer expectations, which isn’t always as easy as it might seem. But, it certainly seems intuitive that offering the best available products is part of achieving high levels of customer satisfaction.

That means not only in core products or services, but also with ancillary offerings and amenities that help support primary products. For instance, the best auto dealers, in addition to providing excellence on the showroom floor, have also built best-in-class service departments. Favored hotels tend to have upgraded their in-room amenities and offer on-site food and beverage facilities, as well as complimentary breakfast. Wireless operators with the best networks are only as good as the handsets they offer – which is why Verizon has finally partnered with Apple, making the iPhone (News - Alert) available to its subscribers, many of whom have been longing for it (read my column in INTERNET TELEPHONY to see why I don’t necessarily agree with all the Verizon (News - Alert) iPhone holdouts).

My question, then, is why would a service provider – whether an ISP, Cable MSO, or traditional carrier – not offer the best possible hardware to its subscribers? I asked this question of Cablevision some time ago, more than a year after I had spoken with Cisco (News - Alert) about its acquisition of Scientific-Atlanta and learned of its plans to release networked DVRs. The answer I was given by a rep who, otherwise, provided outstanding service, was less than satisfying: Cablevision doesn’t want to have to train its staff on all new technology.

There had to be more to it.

More recently, when I switched to Cablevision’s triple play service, I asked a technician who, again, provided stellar support, why the company doesn’t offer a cable modem with integrated WiFi, rather than forcing me to connect a wireless router to the cable modem. The answer: the company hopes to be able to sell such ancillary products to its customers. Well, I did buy a new wireless router, a high-end Cisco model with which I am very pleased but, more importantly, I realized that was the end game all along.

Cablevision, while providing high-quality services in its primary product lines, would rather nickel and dime its customers instead of ensuring their loyalty by providing a few key amenities. Why charge for one networked DVR when you can charge for two or three standalone units? Why provide a modem with built-in WiFi, when you can install a basic modem and sell a wireless router on top of that?

For all its talk about standing up for its customers in its battle over carriage fees with News Corp (News - Alert)., I remain unconvinced. The company does not have a history of putting its subscribers’ interests first.

But, there is a silver lining – for a new and budding market.

What such lack of interest in long-term customer satisfaction, combined with the social media explosion, has created is a new market for Social CRM companies, who are feverishly developing products to integrate social media into CRM systems. Such solution will allow businesses to monitor customer comments – positive or negative – and act accordingly. 

While the market is still largely undecided as to how they should approach social media, two things are certain: social media sites are growing and subscribers are voicing their opinions via social media. Consequently, investors are looking closely at Social CRM upstarts, looking for the needle in the haystack that will be the next Salesforce.com. Why? Because most companies have yet to understand that the easiest way to win customer loyalty is not to endanger it in the first place, securing it at the first transaction. Instead, they choose to continue to react to customer sentiment, working from behind to win their allegiance.

In a recent entry on its corporate blog, Assistly, which earlier this year won $3 million in funding, wrote, “the customer’s happiness is the gating factor to… well, everything.” Thus, in light of providers’ reluctance to truly put the customer first, social media will take on an ever more important role in customer service.

Still, the formula is simple. Running your business on the philosophy of always providing more for your customers than you have to engenders loyalty, even when problems arise. Will it alleviate the need for monitoring social interactions? In today’s world, likely not. In fact, regardless of efforts to build satisfaction in the initial stages of a customer relationship, there will always be issues, and social media will remain a key tool for understanding those issues. But, its role in understanding what creates a happy customer is equally important. Indeed, the full power of social CRM will only be realized by businesses that learn to use it for more than reacting to customer complaints.

Erik Linask (News - Alert) is Group Editorial Director of TMC, which brings news and compelling feature articles, podcasts, and videos to 2,000,000 visitors each month. To see more of his articles, please visit his columnist page.

Edited by Stefania Viscusi