6

Mar

What every business should know about Social Media

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Social Media

IBM CEO Study: Building a good rapport with the customers is the top priority of every CEO. And what are they doing to achieve this?

The report states: Businesses today, are zealously framing social media strategies to accomplish the goal of healthy customer relationship.

Source: IBM Institute for Business Value and Analysis, CRM study 2011

But then are customers actually interested in connecting with companies socially? Let’s figure out:

As the aforementioned IBM study puts it, Customers are pragmatic. Most of them engage with a company on a social media platform (say: Facebook, Twitter, Google+) to get tangible value in return of their time, endorsement and data.

In the words of Carolyn Heller Baird, ‘Today businesses are facing an immense pressure to be there where their customers are. And in the current worldwide explosion of social media usage, companies have left no stone unturned to be socially available.'

Considering the speed at which customers and businesses have adopted social media, the success rates should ideally touch the sky. But this is not so. Why – Because in all probability, customers and businesses are not in sync with each other’s expectations.’’

IBM institute for Business Value surveyed more than 1000 consumers and 350 executives to go into the crux of the matter. The objective behind this mass analysis was –

·         Who is using social media?

·         What sites consumers frequent?

·         What entices consumers to socially interact with companies?

·         Why consumers are interacting on social media? (the company perspective)

Below enlisted are a few of the key findings from the survey:

1. Social media is personal

In spite of ubiquitous presence of corporate profiles over every social media platform, consumers still think that social media is much personal i.e., engaging with friends and family and accessing news and entertainment.

According to the survey, while 70% of consumers cited personal reasons for accessing social media, only 23% agreed of interacting with brands there.

Reasons of reluctance while engaging with brands:

·         Privacy (47 percent)

·         Spam (42 percent)

·         Disinterest in the brand (32 percent)

Note: of the 23 percent consumers who admitted of interacting with a brand socially, emphasized that they need to feel the company is communicating honestly to connect with it.

Source: IBM Institute for Business Value and Analysis, CRM study 2011

What is your takeaway?

Most likely, less than half of the customers actively interact in a social media environment. Having said that, regardless of the customer profile and company type, all corporate social media strategies should be build on one question –

Why would people choose to interact on social media rather than contacting via traditional channels?

While the obvious answer is convenience and speed, experts suggest that businesses need to build strategies keeping in mind the 70% consumers who are not much inclined to participate.

It is essential that companies honestly and authentically communicate to learn what their customers’ value and offer those to persuade them to act. In short, companies need to have transparency to avoid being perceived as manipulative or self-promotional.

2. The perception gap

Businesses perceive that consumers interact in a social media environment to become a part of the brand’s community. Most business owners firmly believe that receiving discounts/coupons and product/service purchase is the least reason why consumers seek companies on social sites.  Ironically, the customers’ opinions falsify this perception totally. When asked to the group of consumers why do they interact with businesses/brands via social media, the following feedback was recorded:

·         Discounts/coupons

·         Products/services purchase

·         Product/reviews/rankings

Inevitably, this question revealed the huge perception gap between the companies and consumers. What got precisely clear is that consumers interact with a business socially, only if they find it to their benefit, say: offers/coupons/product details etc. Although connecting with a brand’s community has an emotional intangible gain, this is not what drives majority of consumers.

Source: IBM Institute for Business Value and Analysis, CRM study 2011

What is your takeaway?

In order to monetize your social media endeavors, adopt social commerce strategy. Multiple cases can be cited as examples of companies offering commerce opportunities through different social media platforms.

Note: The popularity of social commerce campaigns among consumers varies. However, experts believe, the advantage of one-stop shopping is always difficult for the consumers to resist. Thus betting on social commerce is a wise decision.

3. Value of advocacy

Most businesses deem that social media interactions create customer loyalty. The truth in this statement comes under the scanner with a large section of consumers dubious about the influence social interactions have over their brand preference.

·         Astonishingly, only 38 percent of consumers feel that social interaction with a company develops loyalty towards it.

·         24 percent think things remain neutral

·        While a whopping 64 percent consumers believe that social media engagement leads to future purchases only if they already have a sense of loyalty/passion for the company.

Put simply, social media interactions act as a catalyst and not a developer of customer loyalty.

What is your takeaway?

Build social media programs that touch consumers emotionally and motivate them to share their experiences with others. The objective should be to connect with customers on a shared set of values, while providing tangible benefit to them, like American Express Small Business Saturday program on Facebook.

Such social media campaigns will encourage your loyal customers to act as advocates. By supporting/participating in the campaigns, they will share the endorsement with their other social friends. Inevitably, this will expand the viral spread of the campaign and spread the word about your business to the not-yet customers.

Don’t forget

Recent research has cited that 45 percent of consumers seek recommendations from their social pals prior to a product/service purchase. As a result – the power of social media endorsement is paramount and unquestionable.

Social Media benefits

The benefit of implementing corporate social media program is real and deep.

·         Direct value to business through social commerce

·         Instant broadcast of offers/promotions

·         Valuable data for customer insights and brand monitoring

·         Continued analysis of business.

With this in mind, it is understandable that every big and small company is hell bent to use social media for interacting with customers. However, as mentioned above, companies need to shed their traditional approaches and perceptions and get into the skin and mind of the customer.

They need to invest in the right direction to break through the noise and offer a reason for the current/potential customers to connect to their brand.

In the words of a social media expert, ‘’the consumer finings gained from the survey (conducted by IBM institute for Business Value) is a wake-up call that more needs to be done than the regular stuff. Investing in the right technology should be the first step of every company who does not want to miss the boat here.’’

Social CRM – key to social media success

Social CRM recognizes the shift of power in company-customer interactions and hence, helps companies embrace this shift with a new strategy. Instead of concentrating on operational responses to manage customers, Social CRM facilitates sharing and collaboration between customers, partners and employees.

 It enables a brand to truly listen to its customers more than ever before. Consequently companies benefit in several ways like; engaging in social media conversations, tracking new leads from a Tweet and moving them into the sales funnel. In sum, Social CRM gives the benefit of pulling all the contacts in one place to help engage with them across any social channel from an easy to use interface.

Experience the magic of a Social CRM now!

Opt for a FREE TRIAL of ConvergeHub cloud CRM to transform into a social enterprise. Get a deeper insight into your customer's likes, preferences and opinions to accordingly customize your client approach.

 


Patricia Jones

Patricia is a full time CRM consultant at ConvergeHub and part-time blogger. She has earned herself quite a fame as a specialist and market expert in CRM software. In the last five year she has worked with various companies as CRM consultant to help them move their businesses to cloud. Her expertise lies in offering cloud CRM consultation, CRM customization and integration solutions to small enterprises. For last one she is engaged in building ConvergeHub, cloud-based CRM solution for SMBs, as a consultant.Follow her at Twitter: @convergehub


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