Inside the Biz with Jill Dyche

Understanding Social Personas

In which Jill reveals her secret. (Okay, one of her secrets.)

There are some things that only a few good friends know about me. For instance, I like running on the beach. I watch Animal Planet religiously. I enjoy napping in the back of the station wagon, even when it’s parked in the garage. And—I’m not proud of this, but here it goes—on occasion I eat my own poop. The secret is this:  I’m really a dog. And I have 800 Twitter followers.

Don’t go looking for these factoids at www.twitter.com/jilldyche. That’s someone else. Or IS it?

You see, when I started using Twitter I had to reconcile different areas of my life. I like to tweet about professional stuff, including customer relationship management (CRM), social media, and information as a strategic enabler. I also like to chat and share info with my non-work friends, many of whom are hiking buddies, dog rescue advocates, or fellow charity volunteers. Sometimes my work tweeps aren’t necessarily aligned with all my goodwill activities, nor do they always care about my doggie sagas. (Amy is blind, Lu is 14 with vestibular disease, and Colby has epilepsy.)  Likewise my non-work buddies think MDM is simply the acronym for the new slogan, “Mutt Dogs Matter!”

Since Colby comes the closest of my three dogs to having opposable thumbs, I set her up on Twitter. And thus I adopted a new social persona that lets me communicate with a subset of my friends in a more meaningful way, without bothering the rest with humdrum observations or irrelevant news.

[Hiking and dog buddies: go ahead and skip the following paragraph.]

Sound familiar? The definition of CRM (Customer Relationship Management) is the ability to differentiate customers in order to distinguish their treatment. That applies to our sales force, our customer service reps, and yes, to marketing. Why e-mail a customer a discount code for a product he already has? Why ship a catalog aimed at newly-marrieds to a single grandmother? Why pitch cat food to… You get the idea.

Your social persona means more than just having the answer to “Which Superhero are you?” or “Which Barbie are you?” (No, I’m not kidding.) It represents a circumscribed collection of behaviors and preferences, not necessarily your entire set of behaviors and preferences. Social personas—alright work friends, personae—encompass similar attributes and are more narrowly defined. Our social personas help us refine our networks, participate in new on-line communities, and invite fresh collaborations. Social personas essentially allow customers to segment themselves. And they’ll segment themselves in a far more accurate and nuanced way than a marketing department ever could. The implications on sales uplift and return on marketing investment could be staggering.

Indeed some savvy companies have discovered Colby, and are pitching her products according to who she is and what she, er, says. Colby buys bully sticks from Value Pet Supplies (@valuepet); attends fundraisers on behalf of Best Friends Animal Sanctuary (@BFAS); browses the aisles of Red Barn (@redbarnfeed); and has even been known to watch Vet TV (@veterinarytelevision). Colby is a Coonhound, but she’s also a consumer. Those with a stake in the $45 billion pet care industry are cultivating relationships with her.

[Hikers and dog friends: go straight to the end.]

This adds a new wrinkle to social CRM, especially to the already challenging practice of customer segmentation. Most companies still struggle to transcend the well-worn practice of demographic segmentation, seeking to enrich and integrate their customer data to enable more sophisticated behavioral, preference, and usage-based segmentation and with them more intelligent ways to engage and interact with customers and prospects. Persona-based segmentation should be next on their lists.

The hard part of social personas, of course, is establishing the connections between social identities. The very hard part is collecting and structuring that data, then integrating it with the rest of the customer’s profile in a sustainable way.  One could argue that companies have yet to accomplish this successfully with their on-premise structured data, never mind social media data.  But the time to start planning is now.

Among Colby’s followers are @BuckBasset, @Otis_the_Pug, @WinterKitten, and Governor Arnold Schwarzenneger (@Schwarzenegger). You can follow Colby on Twitter at www.twitter.com/Colby_the_Dog. She’ll follow you back just as soon as she finishes her bully stick.

Six Telltale Signs of IT Failure

In which Jill puts her ear to the ground—and hears that giant sucking sound.

We see high-functioning IT organizations that manage their pipelines according to weighted prioritization frameworks that account for business value, available data, and consensus of need. They manage their assets proactively and apply the right skills. They know how to talk to business people.

All this sounds like standard operating procedure, right? Not so fast. There are IT organizations that wait for the business to engage, assign resources haphazardly and without forethought, fail to scope work, and use jargon so thick it would clog your arteries if you drank it.  The well-worn adage is that if you look up and you see that you’re in a hole, stop digging. If there are tools of the trade for IT mediocrity, these six are the shovels:

1. The CIO is all about keeping the lights on. There have been some high-profile decisions in the last several years—News Corp and Harrah’s come to mind—of companies deciding not to replace their former CIOs. The implication is that these guys simply keep the machines humming, right? Show me a company that measures its IT leadership by system uptime and I’ll show you a bunch of unhappy IT employees. Or a company that’s increasingly offshoring core skills.


2. IT is viewed—and run—as a resource pool. One client recently tried to explain to me how its BI team members were also responsible for delivering on non-BI projects. Uh oh. Spreading resources too thin risks blurring the lines between projects, rendering completion vague and inchoate.


3. IT management tries to squelch information or suppress feedback. A data warehouse manager recently sidled up to me after an executive readout and said, “Thanks for not throwing us under the bus.” We wouldn’t have—the data warehouse while immature wasn’t a showstopper—but he thought it might be. The point is that he attended the readout anyway. Many IT managers instead choose to circle the wagons, not participating in open forums that might result in reprioritized work tasks or suggested improvements. Worse, they’ll actively spread negative buzz about a new project or the group that’s leading it. That giant sucking sound? It’s the competition hiring your best people away and leaving you with the paranoid jerks.


4. Lack of business-IT alignment. More specifically, the business won’t consult IT before commissioning outside vendors. It’s an erosion of confidence and trust. Despite our nudging, a media company’s marketing department refused to engage IT before building a CRM solution. Finally ceding to our pressure, marketing agreed to put the internal IT organization its vendor list. IT had to respond to the RFP on equal footing with the CRM vendors vying for the work.


5. No closed-loop success measurement. Perfunctory costing worksheets hastily completed and subsequently forgotten are far more pervasive in IT organizations than aligning IT projects with business priorities. So what is success, anyway, and how do we measure it? We wrote ten thousand lines of code. Our data warehouse has 700 tables, and 450 of them contain over 10 million rows. We’re up to twelve terabytes. And yes, we’re ignoring you.


6. No repeatable rules-of-engagement. You simply cannot gather sustained business requirements by leaning in someone’s cubicle doorway dizzily scribbling into your Moleskine pad. Nor can you represent clear business needs by asking someone what data elements they want, or replicating their Excel spreadsheets in the BI tool-du-jour.

Here’s another indicator we’re seeing more often: if someone who works in your company won the lottery, would losing them put you in deep doo? If so, get a shovel and start digging.

photo by lanchongzi via Flickr (Creative Commons License)

They’re Baaaack! IT Spending in Retail Returns

In which Jill peeks into the pipeline—and sees retail for a change!

In the arena of retailing, we’re all players. But many of us are also spectators, sitting high up in the stands and watching as the game plays out. Lately, the retailing game has been a blood sport, and household names—Circuit City, The Sharper Image, and Linens n’ Things among them—have been casualties.

We’ve been working with retailers since Walmart got its first data warehouse (my partner, Evan, was one of the system engineers on their first Teradata installation), since Kmart beamed POS data over satellites, and the apocryphal diapers-and-beer saga went mainstream. In those early days, it was all about analyzing POS data. Subsequent merchandise management and supplier exchange initiatives cemented the need for IT as both a strategic and operational enabler.

In the early 2000s, as they struggled to implement customer loyalty programs and endured criticism for over-investing in CRM technologies, retailers curtailed their IT spending. They had data warehouses—often several—and kept their attention focused on enterprise applications and e-business capabilities. With the exception of some beleaguered grocers and a sprinkling of catalog companies, we didn’t see many retailers spending on either consulting services or new software solutions.

But things are changing in retail, due in large part to five key areas that retailing executives have earmarked as strategic priorities:

Social media: It’s one thing to create a corporate avatar, set up a Twitter account, and lure customers to your Facebook fan page. It’s another thing altogether to proactively collaborate with customers on product ideas, garner feedback on service improvements, cement your brand messaging, and monitor the buzz. Retailers are getting serious about social media. After JCPenney ran a contest asking customers to post photos in their Penney-purchased apparel, the retailer’s Facebook fan base began increasing by a few thousand a day. “It’s a much more significant part of our marketing mix and it will continue to be a bigger part of our marketing mix,” said a Penney exec about social media.

Survey software: Put simply, retailers are formalizing feedback mechanisms, and executing on their findings. Several retailers we work with have announced new “Voice of the Customer” programs, driven by C-level executives. While most large retailers continue to rely on market research, they’re combining it with customer surveys at the time of purchase in their brick-and-mortar locations as well as on-line. Discounts on future purchases not only get customers coming back, but shopping via different channels—customers who shop across multiple channels are known to be more profitable—thus increasing the retailer’s share of wallet.

Master Data Management: Retailers not only need to manage customer relationships, they must share that data across sales channels, locations, and brands. Retailers came late to the MDM party but they’ve taken a seat and are listening to the music. More than ever, retailing executives are seeing the business impact of so many silo-ed applications and are mandating a “single view” of their customers. MDM not only promises to help retailers harmonize individual customer records across channels and brands, it helps them reconcile their product catalogs and store locations and standardize pricing. Welcome to MDM, retailers, pull up a chair!

Retail in the cloud: Retailers still hamstrung by headcount and IT budget cuts are turning toward the software as service (SaaS) model to enhance both operational and analytic capabilities. Many are looking to hosted services companies like PivotLink and Retail Solutions to deliver self-service, web-based analytics or to provide POS and inventory data to suppliers. Larger retailers may look to outsource customer identification and data enrichment functions by leveraging third-party providers like Acxiom. Mid-market retailers in particular have been looking to the cloud to enhance their reporting and data quality capabilities without adding headcount or hardware.

On-demand reporting: As they increasingly compete on service, retailers are exploring ways to deliver customer intelligence to front-line sales staff. “We use a range of analysis tools, from basic reporting to statistical modeling tools,” explains Kakoli Seal, Vice President of Customer Insight and Database Marketing at Saks 5th Avenue. “But getting information into the hands of our sales associates so they can deliver superior service is a priority.” Saks 5th Avenue uses sophisticated clienteling software to deliver customer contact and other details to its associates. Similarly, a specialty retailer uses mobile dashboard vendor Webalo to deliver purchase history to sales associates, thus enabling them to advise customers as they shop.

With all the emerging technology hoopla, retailers are still focused on two main issues: managing inventory levels and retaining customers. Both involve a little art, a little science, and leaders who are willing to question established industry norms. Indeed the days of unwieldy enterprise applications and IT infrastructure overhauls are a thing of the past in retailing. In their quest to be nimble, retailers are seeking new solutions—and fast.

Interested in learning more about how retailers are re-embracing business intelligence? Read Jill Dyché’s latest white paper: Information for Everyone: BI Evolving in Retail. Download the paper here.

photo by NNECAPA via Flickr (under Creative Commons license)

CRM and Social Media: The Rules Still Apply

In which Jill reminisces about CRM failures past—and warns that past is prologue.

Last year a large brokerage firm engaged Baseline to review its customer strategy and build a CRM program plan. The firm’s customer service and marketing departments had collaborated on a CRM vision and now needed a tactical roadmap for moving forward. That roadmap would include things like an information strategy, new tool acquisition, and a plan for social media.

I love engagements that meld our experience with CRM delivery, customer data deployment, key technology recommendations, and building roadmaps. When the client signed the statement of work, I felt particularly happy, like I’d come home to discover Viggo Mortensen singing in my shower. Here was a project I could sink my teeth into.

We recognized the warning signs almost immediately. A long and random wish-list of new functions. Disproportionate energy around technology acquisition. Disagreements about outcomes. IT circling the wagons while pushing its enterprise app vendor’s CRM suite. It was just like the old days, only with a lot more talk about Twitter.

It’s almost as if this company—where everyone admitted that, when it came to technology, “we have one of everything”—hadn’t heard of the sins exposed in the heyday of customer-focus. It was as if they’d forgotten all the lessons learned, namely:

• Define your requirements before investing in technology
• Articulate end-state goals—and be sure they’re customer-focused
• Be willing to change business processes and job roles to accommodate new customer-centric practices
• Define customer value tiers—and focus on conversion
• Measure both hard and soft ROI
• Create a feedback mechanism to let the voice of the customer drive improvements

Traditionally blame for many of the classic CRM failures has landed squarely in IT’s lap.  But this time IT was off the hook. The business hadn’t been clear about the desired outcomes of its new customer-focused vision, never mind how it wanted to leverage social media to help deliver it. All the lofty mission statements in the world won’t get customers to return to your store or exalt your service on their Facebook pages.

We went back to executives in marketing and customer service and asked them to answer the following questions:

1. Can we agree on our “desired outcomes” for improving the customer experience?
2. When customers who participate in our social communities share more information about themselves and, how will we use this newfound information? How will we avoid mis-using it?
3. What existing capabilities and technologies can we leverage to deliver this new vision? What investments do we need to make?
4. Can we anticipate the organizational impact of these new changes? Are we willing to support them?

Once we collected their answers, we brought executives together and had them discuss each others’ responses. It was clear that while the business wanted to participate in CRM, they expected IT and line workers to actually execute. We helped them understand that their ongoing involvement—and the need to enlist their peers in the Sales, IT, and e-Business organizations—was necessary for customer acquisition and retention. And to instill customer-centricity into the

Yes, it was more complex than they thought it would be. But ultimately they got a comprehensive roadmap for deploying CRM, including a robust plan for incrementally-delivered social media capabilities. And I must admit that when we delivered the roadmap to executives, I felt newly happy. Like Viggo had just asked for the soap.

Meeting Customers Where They Are: When Social Media Misses the Mark

In which Jill watches Social CRM consultants get naked—and throws them a towel.

Don’t look now, but I’m about to marginalize social media for CRM. For those of you still reading, I’d like to share a recent client experience with social CRM. The V.P. of Customer Service at a Top 20 U.S. insurance company had a vision for using social media tools to help insurance agents, and then call center reps, to interact with their customers.

This client spent entirely too long Examining the Role of Social Media in Customer Relationships. There were off-site meetings with key executives in marketing, customer support, operations, IT, and sales. There were strategy documents. There were alignment and ownership discussions. There were cocktail confabs, private appeals to the CFO, and even a few ad-hoc debates in private Yammer groups.

And yes, there were the social media experts. I sympathized with the two guys who came in to lead a discussion of how social media can be a strategic game-changer. They wore t-shirts and alternately spouted clichés about customer loyalty and the importance of transparency. They had the bad manners to tweet as they presented, but the good sense not to use the client’s name. The tone was “let’s get naked and party—online!” One of the consultants proclaimed, “You can’t do CRM without going social.”

Daring? Yes. True? No. You see, the insurance company had already tried enticing agents to use social media. In turn, the agents tried enticing their customers, many of whom they’d known for years. The fact is that social media, bright and shiny though it may be, is still one of many communications channels. In a survey of agents, most admitted that they were available by phone “during 90 percent of the business day, and often thereafter” but they nevertheless tended to use social media “occasionally or when I’m bored.”

The social media dudes advocated enlisting the CEO who, unsurprisingly, was busy doing things like communicating with Wall Street. (And I’m pretty sure that most of those conversations weren’t done using Twitter.) When he was finally asked to publically advocate instant messaging accounts for all agents and a corporate Facebook page, he e-mailed his direct reports a missive that said something along the lines of the following (although shorter, and a bit more colorful):

Who are we kidding? Our agents are our channel. We’ll give them every tool they want to engage our customers, but we’re not going to force them to use new tools for the sake of it. They know our customers—it’s their choice.

Hey, don’t get me wrong, I’m all over social media. But when you come right down to it, a company’s effective adoption of social media has everything to do with its knowledge of its customers. As CRM Magazine managing editor Josh Weinberger pointed out in a recent blog post, “that doesn’t mean you’re absolved of the responsibility to maintain the relationship.”

The fact is your customers should dictate the forum via which that relationship is maintained. And who your customers are, their behaviors, their preferences, and their history with you, has everything to do with that. Factors like tenure, demographics, product offerings, branding and other factors tells us that customers of the Auto Club are far less likely to engage the company via social media, and customers of JetBlue—who don’t interact with JetBlue as much as they stay tuned to JetBlue—are more likely to use social media.

And that’s just how the insurer decided to move forward. Our strategy, in essence, was simple:  “In Touch. Inform. Engage. Inquire.” 

We would establish a social media presence and start “pushing” interesting, relevant, and timely communications to an opt-in community of tuned-in customers. We would then gauge who was listening and use that data to refine messages to the customer segments most likely to use social media. Once there was some history and those segments’ habits and preferences were better understood, new segments could be determined where additional social media strategies could be deployed, and see how they were interested in keeping the conversation going.

Call it an experiment. Call it a community prototype. You can even call it “bottom up social media.” But unless you’re meeting customers where they’re at, don’t call it Social CRM.

Photo via MikeBlogs via Flickr

Rebranding and the Customer Experience

In which Jill argues that rebranding is in the eye of the beholder.

 “Watch your elbows! Coming through!” The outward briskness of the flight attendants is a physical manifestation of their collective intention, which is: “Let’s hurry up and feed these trapped masses so we can retreat to our jumpseats and read ‘OK!’.”

 “We have no implements,” a flight attendant replied when I asked for a spoon. I was 5 rows behind first class, where the tinkling of utensils was drowned out only by the clatter of the liquor cart rolling on its well-worn casters. The twitch at the corner of what was otherwise the straight line of her mouth betrayed her. We were both in on the ruse.

In an act of sheer passive-aggression, I stuffed all my dirty napkins into the seatback pocket, along with a dozen reply cards from various magazines—seven of them from a single issue of Vanity Fair—used the first-class restroom, and contemplated breaking the ultimate rule and texting some friends. I was in a bad mood, suggesting that the Stockholm syndrome is indeed alive and well at 35,000 feet.

Interestingly, this same airline recently rebranded. But rebranding is a hollow exercise if it’s not accompanied by changes in the customer experience. A revamped logo and a signature cocktail in business class hardly count when the flight attendants continue to patrol the cabin like martinets. In the world of customer loyalty what counts is the way your behaviors change. And no, you may not have the entire can.

photo by Aaron Escobar (via Flickr)

Customer Surveys and Social Media

In which Jill maintains that “Who Were You in a Past Life?” isn’t the only survey on Facebook. At least, it shouldn’t be.

I just bought a car. And I just saw my doctor. In the spirit of their respective customer-focus initiatives—of course I don’t know whether either has a customer-focus strategy, but it’s a good bet—both the automobile company and the HMO surveyed me about my experience.

The automobile company called me a week after I bought my car. After leaving several voicemail messages, an agent finally reached me and asked me a series of shockingly banal and uncreative questions. “Was the showroom clean and well appointed?”  Look, I was there to buy a car, not to eat off the floor. “Was your salesman knowledgeable about the car?” Well, he couldn’t get the navigation to work but that’s only because it had never been installed. “Would you buy a car from this dealer again?” I don’t ever want to buy a car again, from this dealer or any other, so that one’s a loaded question.

The truth is: I didn’t particularly enjoy my car-buying experience—who does?—but I love my car. Did the automaker inquire about their new customer’s initial impressions with the product? No. Did they even ask what I thought of their brand before and after my purchase? Nope. Did they ask if I’d tell my friends about the car? Well, if you read this blog you’re my friend. Do you know what kind of car I bought? You get my point.

The HMO’s survey was more structured, and their questions were more relevant. Do you feel like your doctor spent enough time with you? Do you feel she really listened to you? Did she offer useful information? Were the nurses courteous? Did they pronounce your name right? Were all your questions answered by the time you left?  These factors really do contribute to the patient’s care experience, and I appreciate how deliberate and well thought-out they were. Trouble is, the form was two pages long and I had to return it via snail mail.

The surveys were completely different in almost every way, save for one. There was no attempt to cultivate an on-line relationship. I’ve had automobile and healthcare clients, and both industries are extremely focused on-line customer interactions. Many have invested in building on-line communities, encouraging their customers to contribute to an ongoing dialog and gathering important data in the process.

So what gives? Why not ask me for my e-mail address, and have me fill in an on-line form so I could share the fact that I spent more time waiting around for my sales guy than I did talking to him? (Amazingly, this was not true of my physician.)

Better yet, what if one of the questions was:

Would you share your Facebook, Twitter, LinkedIn accounts in the space below? This way we can send you periodic updates and service reminders. Plus, we’d be happy to give you access to our site, which compares your responses to people who bought cars at the same dealership [saw the same doctor].

Sure, you could do this via e-mail (neither survey requested an e-mail address), but social media communications are generally more engaging, more interactive. I would really like to know whether I was hyper-critical of my car dealership, or whether other car buyers, like me, are repressing the memory of the purchase process and are now enjoying their new cars as much as I am. I’d be interested in understanding whether my doctor spends the same amount of time with all her patients, or whether I truly was special. In the process, these companies could not only learn more about themselves, but learn more about me. By opting in, I could receive tweets like:

@jilldyche We’ve received your completed survey! Here’s a link to how your answers stack up with some of Dr. X’s other patients. Tweet us @hmo if you have any follow-up questions.  Meantime, don’t forget your 5000 IUs of Vitamin D!

Customer feedback via social media not only personalizes the message, it reflects my preferred way of communicating. After all, differentiating customer treatment based on the customer’s history and preferences is the very definition of CRM. So what’s taking so long?

A Social Media Mini-Manifesto for Marketers

In which Jill gives advice to well-meaning marketers to manage their messaging.

photo by Zingaro

In my last blog post, I admonished marketers not to abandon a solid, multi-channel marketing strategy in their frenzy to embrace social media. Savvy CMOs are just now coming to terms with the fact that social media isn’t an alternative but instead a supplement to a deliberate, customer-focused marketing plan.

Concentrating on social media often usurps other marketing tactics in terms of visibility. Follow Tony Hsieh, CEO of Zappos.com on Twitter? Sure! Remember the details Zappos’ last e-mail offer? (“Free shipping” reminders don’t count.) I didn’t think so. As awareness of social media grows it risks becoming the Web 2.0 version of “spray and pray.”

What’s a well-rounded marketer to do? Here’s a list of six rules that effective marketers are following now. Consider it a mini-manifesto of social marketing:

1. Stop saying “Hi!” While offering a quippy joke about your sandwich spread or the odor emanating from your dog as she reclines under your desk is hilarious the first time (and maybe even the second time if it’s Braunschweiger), best-practice marketers don’t just entertain, they inform. As much as people like a good chuckle, your customers and prospects are hanging around because of your product, not your witty repartee. Unless you’re Eddie Izzard, be sure that your on-line dialog offers value.


2. Get busy with BI. Every company wants to predict its customers’ wants and needs. To do that requires more than an on-line dialog with customers, it requires an understanding the customer’s profile and historic behaviors. If your company doesn’t have a robust and evolving business intelligence program, build one before investing heavily in a social media infrastructure. Social media analytics and measurement are arguably a subset of a complete BI strategy. If you’re launching a social media program ahead of BI, you’ll end up over-investing in both.


3. Differentiate your members. You have a loyalty program, right? What? You don’t?  Then logoff FriendFeed and launch one. Because understanding who your top-tier customers are is paramount to your company’s share of wallet. Social media and Web 2.0 technologies promise new ways to reach out to your “best” customers and differentiate them to keep them coming back. But first you need to know why they’re your best customers. (See Number 2.) Then, start treating them differently. Then that Facebook fan page might even be useful.


4. Know your influencers. There are customers and then there are “constituents,” those concentric circles around customers that might represent suppliers, employees, service partners, industry gadflies, and marketing analysts. If you’re web-visible, then you’re talking to them, too.


5. Maintain your brand. In the rush to start an on-line party with their customers, some companies forget what they’re selling. Worse, the personality of the blogger/tweeter/e-mailer trumps the voice of the brand. Want to let your followers in on the action while flossing? Get your own personal Twitter account. Want to let on-line customers in on the 20 percent off coupon code? Now you’re tweetin’.


6. Finish strong. Like many buzz-worthy business fads, social media efforts can launch big, then fizzle. Don’t let social media become another intellectual exercise. Have a plan for adopting and rolling out a variety of social media programs,using it as a vehicle for  a deliberately planned marketing strategy. Be sure to define what success looks like. Then measure early and often.

In the end, social media is another set of tools in the marketing toolbox. And, like any business enabler, it needs to pass the management “sniff test,” meaning that it needs to generate sustained revenues or offer savings or efficiencies that exceed its cost to deploy. Otherwise, success is just another word for fad.

Social Media Renders Your Marketing Strategy Obsolete. NOT!

In which Jill admonishes marketers to be deliberate about their strategies now, and tweet later.

photo by Matthew Oliphant

The evolution of social media has all my marketing and CRM buddies a-twitter. (Sorry). They understand that there is promise in using social media tools to strengthen their brand images, to share company news, and to connect with customers and prospects. It’s just that they can’t seem to tear executives away from their balance sheets long enough to enlighten them.

Indeed, faced with falling stock prices, budget cuts, and shareholder disaffection, your CFO is all for social media, as long as it’s free. Your CEO thinks Delicious is a porn site that should be blacklisted from corporate access. And forget about asking your CTO to start blogging. He’s hunkered down trying to figure out the next disruptive innovation, and pronto!

But your marketing department is intrigued, enough to form a social networking task force and send twenty seven staff members to BlogWorld Expo. And just when you think social media has saturated the marketing Zeitgeist, you overhear your CMO say the words, “Friend me” to a supplier. This exchange strikes you as obscene, not because of any sexual undertones but because what the hell is he doing on Facebook anyway, he has a marketing organization to run!

If you’re like me, you’ve noticed that the social media buzz is taking far more time and energy than the answer to the question, “How will sales and marketing support this year’s corporate objectives?” Many sales and marketing organizations have emphasized social media at the expense of their strategies. It’s as if strategy doesn’t matter anymore.

Newsflash: It does. Moreover, the past is prologue. Companies that emerged from the last recession did so by returning to fundamentals. They understood that technology—even the coolest let’s-get-naked-and-party, Sandhill Road-backed, WTF 2.0 software—was nevertheless still a means to an end. In 2001, writing in Harvard Business Review as the dot-com bubble spewed its detritus far and wide, Michael Porter said of the Internet:

“Two broad conclusions can be drawn. First, many businesses active on the Internet are artificial businesses competing by artificial means and propped up by capital that until recently had been readily available. Second, in periods of transition such as the one we have been going through, it often appears as if there are new rules of competition. But as market forces play out, as they are now, the old rules regain their currency. The creation of true economic value once again becomes the final arbiter of business success.”

If you substitute the Internet theme of Porter’s assertion with social media, the same truisms apply. Companies still have to articulate how they intend to compete in the market, serve their customers in differentiating ways, and innovate. Smart marketing, customer experience management, and CRM leaders will lift their heads from their Facebook 25 Things lists, craft a deliberate, multi-media plan that supports their firms’ unique value proposition, and then—only then—determine how social media will fit. Got that? Okay, now friend me.

Social Media and CRM

By Jill Dyché

In which Jill in gets a bad grade, but keeps a good client.

My client is a long-time, self-described “data geek” and we get together when I’m in the Bay Area for status updates and some gossip. So here we are sipping our lattes at the headquarters espresso lounge and we’re not talking about data models (yet), open source BI tools, or what new information Marketing needs for its campaigns. “Our CRM is Web two-oh,” he tells me as he bites a biscotti.

photo by filipe ferreira

This is a departure for him, and I’m not sure what to make of it. “Really?” I say, cursing my lack of creativity but at the same time not wanting to prematurely prescribe anything.

“Yeah,” he says as he chews. “We have a corporate LinkedIn profile, our sales reps are friending all our clients on Facebook, and we have a corporate commercial on YouTube. AND,” he adds, inserting a pregnant pause for effect, “I just convinced our CEO to do Twitter!”

“So how are you measuring success?” I ask him. It’s a genuine question, but his expression changes immediately, and I realize I just graded a C minus in my role as Trusted Advisor. My client explains that though they haven’t worked out measurement yet, the fact that they’ve embraced social media is in itself a major cultural leap, as well as a personal career coup for him.

But is it really? Anyone in a bowling league, a reading group, or yes, a corporation, can throw together a MySpace page or cultivate a tribe of tweeple on Twitter. The adoption of online tools doesn’t automatically propel a company forward into the new world of social media any more than partying at Social Hollywood makes you a hipster. The art isn’t in establishing a social media presence as much as it is closing the “talking-listening-acting” gap.

When social media pioneer Scott Monty joined Ford Motor Company last year he set about helping on-line content providers tell “richer stories” about the Ford brand, once engaging a web site owner that Ford’s legal department had considered suing in a positive partnership dialog. The point is that Monty and his team have their ear to the ground when it comes to the Ford brand. They regularly act on the information they access—from online tools and elsewhere—to refine that brand. And yes, a potential Ford Focus buyer can indeed use the website’s RSS feeder to get regular SNPRs (Social Media Press Releases) and other updates about the car pushed to her reader or e-mail account.

My client wants to talk to me about the virtues of Facebook over MySpace and how FriendFeed can help drive more engaged customer conversations. But I owe it to him to tell him that this isn’t the hard part. The hard part is establishing new business processes and job roles in order to use these and other emerging social media tools effectively. It’s establishing on-line personas that are legitimate and empowered to engage in sometimes-difficult conversations. It’s about more than listening to or even  celebrating customers. It’s about formalizing new ways to capture this data, use it to re-segment customers, measure your share-of-voice, and redefine customers’ experience with your products and your brand.

And if you make some friends in the bargain? Well, that’s kewl too. E-mail me your comments—or tweet me @jilldyche if you’re already there.