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Lessons Social CRM Can Learn From Telecom's Mistakes

Lessons Social CRM Can Learn From Telecom's Mistakes

It's not enough to buy social CRM tools and start flailing away. You have to tune your approach to your customers, and doing that will make your approach different from every other business' approach, because your customers are different -- and, if you're on top of things, you understand why they are different.

By Christopher J. Bucholtz CRM Buyer ECT News Network
03/10/11 5:00 AM PT

Around the time the Telecommunications Act of 1996 was passed and signed into law, I was a reporter covering that area of technology. Specifically, I was writing about service, measurement, data management and the software that made all that possible for telecommunications companies.

Little did I realize it, but this was a great laboratory to get a peek at what would be important for building customer relationships for all businesses. More than that, it offered a view of the adversarial relationship between innovation and the status quo. That's a battle we see today as companies wrestle with social media and social CRM, and the human dynamics today are the same as they were 15 years ago in the telecom industry.

One of the things that drove me crazy back in the "olden days" was that when telecom companies discovered an innovation that worked for their customers, they often treated it as if it were a state secret. I heard about lots of great technologies and strategies off the record, due to fear that competitors would then adopt that innovation.

Business vs. Customer

There were major problems with this approach. This secrecy often doomed the small company providing the innovative technology by limiting its customer base. Another hazard was that telecom companies saw innovation benefits accruing only to their business when, in reality, customer service gains and flexibility in product delivery were really benefits to the customer.

Keeping the "how" a secret often meant that innovation was not only shielded from competitors' eyes but also obscured from internal attention, which often led to really interesting and innovative ideas being shelved during realignments, belt-tightening and leadership changes.

Many of the customer service technologies finding homes in business today had their roots in products that were sold to the telecom industry -- and yet calling your phone company is still an exercise in frustration.

Too Secret for Your Own Good

I truly hope this does not happen with social CRM -- that innovative approaches are played so close to the vest that the ideas, techniques and technologies are obscured both inside and outside the business.

Lack of external visibility is not so much of a worry -- that dynamic is different. The vendors playing in the social space are nothing if not vociferous about getting their message out, as befits players in an ever-more-social world. They are not constrained like the companies trying to service telecom were by a limited number of potential clients; they see a constellation of potential customers, and they're going after them.

It's the internal business dynamic that I fear may be the same: Competitive pressures keep an innovative approach hush-hush for so long that even its successes aren't made known internally, or they aren't correlated to improved results.

When that happens, the innovation becomes vulnerable to ROI arguments and shifting priorities. The silence surrounding it becomes ammunition for skeptics who can rightly or wrongly work for the abandonment of techniques and technologies that can be truly business-changing.

Avoiding this is as easy as understanding how vital the customer is to your business's identity. The reality for the telecom companies was that the exact same service innovations that worked on the West coast may not have worked in the Southeast or in New England. The customers were different, the products they bought were different, and the way they interacted with their carriers was different.

There were many similarities, but there were also some subtle nuances. Using a certain technology was not enough -- understanding how to use the technology in the context of the customer would have been the key to success.

It's About the Customers

The same thing goes for social media and social CRM: It's not enough to buy the tools and to start flailing away. You have to tune your approach to your customers, and doing that will make your approach different from every other business' approach, because your customers are different -- and, if you're on top of things, you understand why they are different.

To do that, you'll need input from sales, service and marketing people in your business, since they deal with identifying and working with these customers on a daily basis. While you're doing that, be sure to share the news of your efforts so that they don't take place in a vacuum.

Keeping your social media and social CRM efforts on the down low is not only contradictory to the idea of social -- it sets you up to repeat the failings of the late 1990s. Ensuring visibility both inside and outside your company will only strengthen your efforts, and strengthen your support within your organization.


CRM Buyer columnist Chris Bucholtz blogs about CRM at Forecasting Clouds. He has been a technology journalist for 15 years and has immersed himself in the world of CRM since 2006. When he's not wearing his business and technology geek hat, he's wearing his airplane geek hat; he's written three books on World War II aviation.


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