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Measuring
the Returns From
Social Media
Acxiom............................. 4 Jive.................................. 7
Engaging Consumers with Real-Life Examples of
Direct Social Media Marketing Social CRM
eGain.. .............................. 6
Harvesting Social Knowledge
for Customer Service
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Measuring
the Returns From
Social Media
B y all accounts, social CRM is red hot. And it’s no wonder: Combining the intimacy of
CRM with the breadth of social networks and online communities is a powerful way
to increase customer engagement.
Consider recent statistics: Twitter has surpassed 75 million users, while Facebook recently
reported that it has a whopping 400 million active monthly users. Socialnomics reports that
96 percent of Gen Y consumers have joined at least one social network, and more than 1.5
Now is the time for
million pieces of content (e.g., articles, blogs, links, photos) are shared on Facebook alone
organizations across
each day. Additionally, about one third of bloggers post opinions about products and brands.
industries to use
According to a July 2009 Nielsen survey of 25,000 online consumers from 50 countries, 90
social CRM to get
percent of respondents said they trust product and brand recommendations from people
closer to customers
they know. Socialnomics finds that only 14 percent trust advertisements.
and to react more
With all this influence shifting online, now is the time for organizations across industries
quickly to trends.
to use social CRM to get closer to customers and to react more quickly to consumer trends.
According to industry expert Paul Greenberg, social CRM is a strategy “designed to en-
gage the customer in a collaborative conversation in order to provide mutually beneficial
value in a trusted and transparent business environment.” Ideally, this means combining the
best aspects of CRM and social media to create a strategy that uses deep customer insights
to foster deeper customer relationships. It includes such activities as running a company-
hosted customer community to gather feedback, delivering Twitter-based customer service,
and using information gathered from social networks to track customer sentiment.
Although “soft” benefits like customer engagement are clear, “hard” benefits can be elu-
sive. Placing financial metrics such as return on investment (ROI) around social CRM efforts
has proven to be daunting for many companies, says Don Peppers, founding partner at Pep-
pers & Rogers Group. “We’ve not yet come across any organizations that have been able to
successfully measure social CRM returns using hard financial metrics such as net present
value or increased cash flows,” Peppers says.
Even so, social CRM delivers real impact. Companies can obtain measurable improve-
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Studies by Forrester Research have determined
that the ROI for customer service communities is
nearly 100 percent within 12 months.
ments in their business performance through social CRM then be calculated by multiplying the cost per call against
initiatives even if traditional financial metrics can’t easily the number of calls deflected. Studies by Forrester Research
be applied. Organizations can harvest social knowledge to have determined that the ROI for customer service communi-
learn more about their customers, concerns, needs, behav- ties is nearly 100 percent within 12 months, Petouhoff says.
iors, and preferences. Taking action based on that informa- Petouhoff cites as an example Lenovo and its experiences
tion can help to improve customer satisfaction and build after it acquired IBM’s PC Computing division in 2005. After
loyalty. They can use social media channels to listen to cus- the deal concluded, Lenovo executives noticed that its cus-
tomer feedback and create forums for product innovation. tomers were talking about its products in third-party forums,
This can drive up both engagement and sales. And they can such as notebookreview.com. Lenovo’s executives were con-
discover and engage influencers. As many companies are cerned that they were being left out of these conversations.
beginning to discover, power bloggers and Twitterers can Consequently, Lenovo launched its own peer-to-peer on-
have a dramatic effect on business through brand recom- line community. Its goal was to learn more about customer
mendations and word-of-mouth endorsements. views on its products, including features and shipment de-
lays. Although a 2 to 3 percent reduction in support calls
Call deflection calculations would more than offset the cost of building out the commu-
One area of social CRM where companies can often de- nity, Lenovo aimed for a 15 percent reduction. Within a year
termine ROI is online communities, says Peppers. For in- the company experienced a 20 percent reduction in calls
stance, an organization that uses social media to listen to to its contact center regarding laptops for the U.S. alone,
customers can track how many complaints it intercepts thanks to direct and indirect call deflection through the on-
online and prevents from reaching its call center. Combin- line community. Lenovo has also seen an increase in agent
ing this with estimated cost avoidance delivers a hard-dol- productivity, a shortened problem resolution cycle, and a
lar cost savings. By some estimates, each call to a contact reduction in its support costs.
center costs a company about $8. But the cost to resolve In the pages that follow, learn how your organization can
problems online typically costs a fraction of that amount. harness social knowledge, use online communities to foster
The value of call deflection also can be determined by peer-to-peer support, listen to conversations that customers
measuring call volumes before and after a social network are having in social communities and extract meaning from
connection has been deployed, says Natalie L. Petouhoff, them, and collaborate with internal stakeholders on how
Ph.D., an analyst at Forrester Research. The savings can best to react effectively to customer feedback.
Source: “The ROI of Online Customer Service Communities,” by Dr. Natalie L. Petouhoff, Forrester Research, Inc., June 30, 2009.
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pick up the phone and call a company’s help It’s a very manual process. g Attensity Service seeks out information
desk. That customer more commonly will “Search” starts with you feeding a sys- from expert forums and customer commu-
turn to the internet – to web communities tem words to look for. “Text analysis” starts nities, and text analysis is used to extract
and self-help portals to answer their ques- with the text itself and lets it tell a story. It the problem and solution pair, as well as the
tions. How can the enlightened company “reads” through documents, extracts the products and issues the social CRM interac-
use this trend to their advantage? key entities, relationships, and sentiments tion is about. This information can then be
This shift to the internet has opened new from that text, and then gives that text a added to internal information, related to a
opportunities for companies to more ef- unique “barcode” of all that information corporate ontology and knowledgebase,
fectively LISTEN to customer conversations, that can be used in downstream operations. added to intelligent decision trees, and pro-
ANALYZE those conversations, RELATE the Text analysis can be used to shed light on vided via Attensity’s self-service portal for
information within those conversations to compliments, complaints, questions, is- search and guided navigation.
existing information within their enterprise, sues, suggestions, reasons for purchase,
and then ACT on those conversations. We intent (to buy, to leave), and so forth. g Attensity Respond uses the LARA process
call this the LARA methodology. to automatically “read” emails, tweets, and
RELATE posts and react accordingly, automatically
LISTEN Next, you want to relate this information to answering an email about a refund policy,
The first step involves ascertaining where the structured data that exists, to reveal the routing an unhappy customer’s tweet to
your customers are talking about you, and why’s behind the numbers. And we’ll help customer service or a social media team, or
designing a listening program that enables you break down the informational silos that automatically routing a “threatening to sue”
you to better understand what they are say- exist in your organization. For example, posting as a mobile alert for legal to review.
ing. We often find that a company’s “social you might want to better understand how
media listening” efforts belong with one the content or sentiment expressed in cus- g Attensity Analyze uses text analysis for
group, their “CRM listening efforts” are in tomer emails affects call center time-to-res- data mining operations, allowing you to see
another group, and their survey listening is olution time, how many of a product that reports on customer sentiment, complaints,
in yet a third group. Marketing, sales, and customers are expressing issues with have compliments, and other information as eas-
customer service all have important informa- shipped, or how various actions affect your ily as you can report on inventory levels and
tion that must be shared to create a complete net promoter scores. sales figures. Companies like JetBlue and
picture. This is where text analysis can help. Whirlpool are using this system to better
ACT understand their customers and gain early
ANALYZE Using all of this information, your organiza- warning on issues, enhancing loyalty and
Text analysis is not search. “Search” was tion can then more effectively act. Attensity responsiveness. g
specifically designed to enable you to quick- provides a complete customer experience
ly find relevant documents that contain a
term of interest. Search only really indexes
keywords. It doesn’t understand what text About Attensity
is really about, and it’s not able to give you
Attensity provides software applications based on semantic technologies to find,
a big picture of the information that tweets,
understand, and use information trapped in text to drive decision-making. With more
posts, and other documents contain. Be-
than 500 installations worldwide, Attensity software is used by government agencies
cause search is document-centric and relies
and innovative enterprises like Airbus, Charles Schwab, Bosch, JetBlue, Travelocity
on keywords, it’s hard with search to get
and Vodafone to track trends, identify patterns, detect anomalies, reduce threats, and
the big picture. How can you look at a set
improve customer satisfaction and retention.
of search results and get answers to ques-
tions like: What do people think about my For more information about Attensity, visit www.attensity.com
company? What problems are they having?
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of the Web and social networking tools, it Deep Dive, Deep Dive,
Low High Platinum Service
has gone to a new level, leading to the phe- Gold Service
HIGH
nomenon of “social knowledge.” While more
B2C
LOW
B2B
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Acxiom Corporation
1.888.3ACXIOM
www.acxiom.com
Attensity Corporation
2465 E. Bayshore Road, Ste 300
Palo Alto, CA 94303
(650) 433-1700
sales@attensity.com
Follow us: http://twitter.com/attensity
Jive Software
877-495-3700
www.jivesoftware.com
Join the conversation:
jivesoftware.com/jivespace
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