Customer relationship management (CRM) has made inroads quickly over the past year into the world of social media, adopting Facebook, Twitter, YouTube and Google-plus to reach customers.
Mark Woollen, vice president for CRM product strategy at the US-based Oracle Corporation, says so-called social CRM is a new management tool being used by many companies around the globe as it is proactive and more effective than regular CRM.
For example, social CRM can help companies greatly improve customer service by enabling them to detect early signs of discontent and deal with it proactively.
Shortly afterwards, the musician wrote a song titled "UA broke my guitar" and posted it on YouTube. The clip went viral, and later generated several articles in print and other media, tainting the airline with bad publicity.
To avoid a similar fate, some companies have created a new staff position, called a community/marketing manager, to take charge of monitoring social media.
The role of a community/marketing manager involves being an active member of major social media networks so as to effect timely engagement and responses to any publicity, good or bad, about the company, its products or services.
The company's community manager will act as if he or she is part of that social network.
One example is furnished by a Malaysian telecom service provider's proactive response to complaints of an Internet service breakdown.
According to Woollen, the younger, more tech-savvy generation of customers - especially those in their 20s and early 30s - do not expect to have to call a company's service centre if there is a service breakdown.
In the Malaysian case, social CRM was able to come to the rescue, allowing the company, which provides 4G (fourth-generation) Internet service, to be proactive.
The firm can now reach their customers quickly to report how big the problem is and when the service will return to normal.
Woollen says this kind of social CRM is possible when using Oracle's monitoring tool for Facebook, Twitter or YouTube feeds. The software will monitor any mention of your company, your products or the quality of your services - depending on your setting - that occurs on these social media sites.
The monitoring can be set for geographic regions, or according to other criteria, so that engagement and responses can be more proactive and effective.
Social CRM tools are also useful in sales and loyalty programme management, especially for high-value customers.
Instead of making phone calls and sending e-mails, marketers typically now turn to Facebook and the likes to launch their campaigns.
For example, retailers like Lane Crawford are more likely to launch their new fashion line and offer incentives to high-value customers via social networks. Though some of these customers may not buy, they can share the information on new products, promotions and services with friends on social media. Given that trends on social media networks are driven in this way by word-of-mouth, they serve as a cost-effective method to get sales leads and new customers.
Facebook, for example, now has more than 750 million users worldwide, with 50 per cent of these logging on to the network on any given day. On average, each user has about 130 friends. Overall, its users spend more than 700 billion minutes per month on Facebook.
Woollen also points out that today's consumers have more trust in their community than in any company executive, so it is more effective to use social media to put a company's message across.n