Social CRM Doesn’t Exist, But a Need Does

by

Director of Marketing,

Social CRM is to the social media craze what eCRM was to the dot com bubble. The enterprise apps community is hungry for a big new category and social CRM smells tasty. As a result, software vendors, tech media and research analysts are all racing to promote and opine on this new market. Gartner, for example, appears to have hastily published their Magic Quadrant for Social CRM, which has been panned as confusing and unfocused.

But Social CRM Doesn’t Exist
In reality, social CRM is a misnomer. It doesn’t exist yet. This catch-all nomenclature implies a category far more straightforward than the diverse set of specialized systems currently targeting the social media opportunity.

“There is no such thing as a social CRM suite yet, says Jacob Morgan, Principle at Chess Media Group. You have community management platforms, CRM vendors, monitoring guys. No one does everything.”

The debate over social CRM has been drawn out over the past couple of years and analysts are still at odds over how to define it. Depending on who you ask, social CRM will mean something different.

“Trying to put a blanket over it and calling it a market is very difficult right now,” says Bob Thompson, CEO of CustomerThink. “Gartner attempted to do it and they ended up doing silly things like putting community vendors like Jive and Lithium in the same quadrant with CRM vendors that are doing Twitter feeds.”

So why all the buzz? Because there is a need for social CRM. Companies need a scalable way to engage customers in the social sphere. This includes everything from managing brand reputation, to responding to customer service requests, to finding new sales prospects.

The State of the Market
Currently, the social CRM landscape is comprised of several evolving software categories, each with 20 to 150 vendors competing for market share. To help you understand the lay of the land, I’ve created version 1.0 of the Software Advice Social CRM Market Map. It provides a fast, easy way to visualize the leading players in the social CRM space:

 

 

 

Social CRM Market Map
 

 

 

In this map, I segment the market into four categories, each of which markets could be divided into as many as 16 subcategories. However, I can sum them up into three primary applications:

  • Social media monitoring. Monitoring tools allow organizations to “listen” to conversations happening on the web. Also referred to as brand monitoring, social media monitoring allows you to track who is saying what about your organization or your competitors, as well as track when it is said. Some systems also allow you to publish responses, such as Tweets or Facebook wall posts. Social media monitoring is a crowded space with roughly 150 companies vying for a piece of the action.
  • Social analytics. Analytical applications go beyond web analytics and social monitoring to analyze conversations in the social sphere. They can analyze text, rather than just visitor behavior. For example, an analytics program could scour text from emails, surveys and social media, and then report trends and insights that help you decide how to respond. Social analytics companies often pair their main offering with social media monitoring tools.
  • Social platforms. Platforms empower an organization to build its own social communities or networks. These may be internal systems to foster employee collaboration or external networks for customers, prospects and partners. Deploying a social platform is like having your own private-label Facebook. There are roughly 125 vendors offering some form of social platform.

At the same time, CRM market leaders are trying to piece together their own social CRM suites through development, partnerships, and acquisitions. Salesforce.com is the most likely to succeed in this effort. Over the last two years they introduced new social applications, like Chatter and Salesforce for Facebook, and made strategic acquisitions – notably Jigsaw and Dimdim. I would argue that Salesforce is a social CRM leader, rather than just a CRM gorilla trying to edge in on a new market.

Software vendors are all racing to build complete social CRM suites. What does this mean for buyers in the meantime? If you want a complete social CRM system, you will have to piece together tools from multiple vendors.

Next Steps
First, ignore the buzzword. There is no standard for what should be in a social CRM solution and there are no vendors that offer everything. Don’t just say, “Hey, we need to get some of that social CRM!” Instead, you need to decide what you are trying to accomplish and which categories are most likely to make a meaningful contribution to your strategy.

You will need well-defined goals for your social CRM strategy. If you just want to track what customers are saying about your brand on the web, then a social media monitoring application will suffice. But if you want to analyze that data, identify influencers, or spot trends, you should explore social analytics. Finally, if owning the community is strategically important, you will need a platform to build out that environment for your constituents.

Keep in mind that social CRM vendors don’t offer the same level of sales, service and marketing functionality that traditional CRM vendors offer. So if you need capabilities like sales lead management, lead nurturing and a few social features on the side, then you should really be running a CRM software comparison.

We’re obviously just skimming the surface here, but we’ll be publishing more on this topic throughout the year. In the meantime, check out the 18 Use Cases of Social CRM from the Altimeter Group and Social Business Framework from IDC. These tools present possible uses of social media and align them with business objectives.

Special thanks to Brian Solis, digital analyst and author of Engage; Michael Fauscette, Group Vice President of Software Business Solutions at IDC; Kathy Herrmann, thought leader on social business and change management; Paul May, CEO of BuzzStream, and; Peter Hrabinsky, VP of marketing at Antarctica Digital for their input on this article.

 
  • http://www.oneforty.com Janet Aronica

    So I love that you are challenging this. We can’t just throw buzzwords around. Where do you place social media monitoring tools and dashboards that have Salesforce integration? (CoTweet, Hootsuite…)

  • Allie Brie

    It’s not true at all, most of the CRM’s out there have social components. SugarCRM and FreeCRM.com both have this…why is Chatter “Special” ?

  • http://www.oursocialtimes.com Luke Brynley-Jones

    I’m pleased it’s not just me thinking this. It’s very useful to see the “real” quadrants set out too. I’ll be hosting Social CRM 2011 in London and New York later this year (see http://www.socialmediamarketing.co.uk). I think you may just have written my opening remarks!

  • http://blog.relenta.com Dmitri Eroshenko @Relenta

    “Software vendors are all racing to build complete social CRM suites”

    More power to those who are. The word “suite” spells disaster. The end result will be more software bloat than ever before. Life is too short for that.

    Enterprise users are always screwed off the bat because the tools people in sales are forced (no pun intended) to use are selected by those who sit in the corner office, not those who get things done.

    Good news for small businesses because it’s not hard at all to give them 90% of the functionality they ever need with only 10% the application weight.

  • http://www.linxonesolutions.com Jason Collins

    I agree with this to an extent. Social media is such a new frontier (in a relative sense) when it comes to using it in a marketing plan and strategy. We’ve yet to scratch the surface as it relates to the power of social media in advertising, and there is no way a comprehensive CRM exists right now. Tying all aspects of social media into one CRM would be quite the task, and there’s no doubt that Social media will continue to evolve. So, who knows if there will ever be an effective social media suite that will handle everything. I hope there will be. It will give validation to our (my) work on an analytical level…Right now though, it’s about being creative, and just convincing businesses that social media is a viable outlet for their advertising model.

  • http://www.brianvellmure.com Brian Vellmure

    Houston, good writeup.

    While I don’t disagree with much of your sentiment, I’m afraid the cat’s already out of the bag regarding Social CRM (which emerged from the initial concepts of CRM 2.0, started in 2004-2005)

    You are right though – start with the job to be done and then create the appropriate strategy and process(es), leveraging technology to accomplish what you’re trying to do.

    For those new to the term, I curated quite a lot of quality content into a Social CRM Resource Guide, which some may find helpful.

    http://freecrmstrategies.wordpress.com/2010/06/30/the-complete-social-crm-resource-guide-1st-edition/

    Best regards,

    Brian
    @CRMStrategies

  • http://www.socialbusinessadviser.com Jacob

    @Janet
    The tools you mentioned are still just that, social media monitoring and engagement tools. No such thing as a social CRM tool or suite. The concept and idea means so many different things to different people that it’s almost pointless to start defining and putting things into buckets.
    @Luke
    You;re definitely not the only one! It’s quite frustrating actually :) Congrats on hosting the event in London, if you need speakers/presenters/etc let me know!

  • http://blog.sysomos.com 40deuce

    I’m interested to know if you’ve seen JitterJam, Houston?
    They bill themselves as a social CRM and I’ve actually been looking into them a lot recently. As a community manager for a social media monitoring software company I easily have a pretty good handle on what is being said by our customers and in our industry space, but I’m looking for something to help me keep better track of all my interactions in the space and this looks like it may be a viable option to look at.
    Just wondering your thoughts on it since you say that there is no social CRM yet.

    Cheers,
    Sheldon, community manager for Sysomos

  • http://www.customerthink.com Bob Thompson

    Nice article!

    Social CRM is a buzzword trying to become a market, and maybe it will be if analysts can agree what is included.

    However, if Social CRM = all the old CRM stuff plus any social media software that can be used in the enterprise, I don’t know how useful that will be to potential customers/buyers. Perhaps good for CRM vendors to “social wash” their solutions to remain fresh or appear so. Not so sure that “CRM” is going to help the new social software vendors much (e.g. community software or SMM). I think they deserve to be treated independently with similar solutions, not lumped into an ill-defined buzzword.

    Personally, I prefer “social business” as a generic term for social media used in business. Not a market, but a very important trend nonetheless, and one that will drive lots of software and service purchases in the coming months and years.

  • http://www.crmatic.com Alyson

    It is nice to find well though-out articles out there. As a CRM consultant, the “Social CRM” game is something we’re paying a lot of attention to. It is great to see what others in the business think and when you can learn something new, it is all the better!

    Keep up the great writing!

  • http://www.nimble.com Jon Ferrara

    Thanks for continuing the Social CRM conversation and education Houston. I think the term #Social will go away once the masses understand that it is just another way of Listening and Engaging. Until then #Social & #sCRM serve as education tags for people to gather around and learn. Following is a recent post I wrote about SocialCRM. It sums up the graph above. There are lots of parts involved in a complete SocialCRM platform and that no one has brought them all together, YET.

    Outside of the #SocialMedia Kool-Aid drinking early adopters do the majority of potential business customers even know what #Social is? Do business really use their CRM platforms for relationship management? Most business people are still managing their contacts using the simple tools like Outlook, Address Book and Google Contacts and their idea of #Social is an occasional trip to LinkedIn and Facebook.

    They use the simple tools because the CRM platforms are not doing a decent job of contact management. CRM systems are designed for management to keep their finger on the pulse of their business and the hand around the neck of the salesperson and most sales people live in simple contact tools and feed the CRM system whatever they need to so management can run reports. Twitter & #SocialMedia is intimidating to most business people.

    The Enterprise Listening & Collaboration platforms, many of which are trying to get acquired or IPO soon, create confusion when they claim that they are #sCRM & Social Customer Platforms when they are missing the most important piece, the relationship manager. Who are we listening and collaborating about? Our prospects, customers and partners.

    We need to remember that the R in CRM is about relationships and that the root of CRM was and still is contact management., We need to build CRM systems that do a good job of relationship management, which is based on the Four C’s; Contacts, Calendars, Communications and Collaboration. That Collaboration includes strong #Social Listening and Engagement.

    The #sCRM movement will really take off once users understand #Social and they find the right tool(s) that blend relationships, team & community collaboration with listening.

  • http://www.aimtheoryCRM.com Ian D. Rossi

    @Houston, great post. I love the quadrant. It’s nice to see everybody in their respective groups and not just lumped into a “social CRM” group. I wholeheartedly agree with your take on it.

    This whole “social” thing is definitely a turning point in CRM. Here’s why: CRM is already bloated enough. Now we’re going to throw “social media” searching, monitoring, mining and analysis at it.

    What makes this more interesting is that the phrase “social media” quickly brings to mind Twitter and Facebook. However, it also includes blogs, which is just internet content, since “blog” is hard to define nowadays. So, what is “social media” then? It’s pretty much the Internet. Really, c’mon–what’s “social” content and what’s just regular Internet content?

    So, basically, CRM tools of the future are going to have to be able to search, monitor, mine and analyze the entire Internet. That’s a daunting task.

    What does this mean for small business? It doesn’t bode well. Since small businesses need to have enterprise features in order to compete, the SME CRM vendors will have a tough time incorporating these much-needed-yet-unwieldily-complex features into their feature sets. We’ll see how this turns out.

    @Jon, I agree with you that we still need to focus on the relationship. And, of course, this involves real contact with customers. However, since customers are now communicating sentiment (satisfaction) how they choose–on the Internet (whether it be dubbed “social” or not)–on a stage in front of the world–the 4 C’s will only go so far. But again, this isn’t something that just Twitter feeds, Facebook updates and LinkedIn status tracking is going to solve. It’s bigger than that. It’s the entire Internet.

  • http://xeesm.com Axel Schultze

    Social CRM is like trying to run IBM Mainframe software on PCs in the 80′s and trying to move PC applications onto webservers in the mid 90′s. Hundreds or thousands tried, failed, learned and finally understood we are talking about an entirely different concept. CRM and “sCRM” is no different.

    For those who keep digging: Think snow avalanche – most dig in the wrong direction.

    Axel
    http://xeesm.com/AxelS

  • http://www.buzzstream.com/blog Paul May

    Nice post. Totally agree with Jon’s comment about relationships being at the center of social CRM. Paul Greenberg has pointed out that social CRM is an extension of CRM, and, for both, the single view of the customer/prospect lies at the heart of the data model. Given this, I would place the platform portion of the CRM vendors’ solutions at the center of your picture, with a set of horizontal apps plugging into them.

    That said, trying to map the landscape of horizontal apps is inherently difficult because, unlike traditional CRM, virtually all apps fundamentally depend on three core functional areas – profiling, listening and community. There are differences in how these get applied for each horizontal app (e.g., the profiling data you collect for sales is different than for support, a support community solution is more workflow-centric than an influencer relations community, etc.), but the there’s still a huge amount of overlap. So when I look at Jeremiah’s use cases, I think they map pretty well to how people are using social CRM, but because each solution gets utilized for multiple business processes, the mapping to the vendor landscape doesn’t map nearly as well. I think this is the one significant difference from traditional CRM (the functional overlap from category to category in traditional CRM is very limited).

    One of the big question for me is whether Jive’s long-term aspiration is to leverage the fact that they have all three of the core social CRM capabilities to become a true CRM platform player. For now, they tell an “embrace and extend” story when talking about traditional CRM, but I suspect that they have bigger things in mind.

  • http://mariasconsulting.com Maria Snyder

    Thank you for writing this insightful post on social CRM. Your graph categorizing players painted an eye opening picture of the many options available to social media managers like myself. I agree with your statement that “you need to decide what you are trying to accomplish and which categories are most likely to make a meaningful contribution to your strategy”. Many clients overlook that important step to a social media plan. Please keep up with this topic and write future posts as the social media market evolves.

  • http://www.bostonassociates.com Ronald C. Pruett, Jr.

    Terrific presentation but what about open source alternatives like Drupal etc.?

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