Social CRM: Innovation Through Community

Seldom are people able to identify the long-term implications of game-changing innovation when unveiled, but if we’ve learned anything throughout the past several weeks of hype surrounding the release of the iPad, it’s that originality in technology is alive, well and demanded from customers.

However, the most interesting inventions are not necessarily those that are most profitable, have the highest adoption rate or survive to see a second or third edition. The most successful innovations are those with the highest demand – innovations that solve problems we did not know we had.

Forrester Research noted that all successful IT innovations must satisfy four cascading criteria: 1) technological advantage; 2) economical advantage; 3) compatibility with vested interests; and 4) ability to encourage development of complementary elements. Although IT-focused innovations represent only a slice of the pie, this criteria provides a map to guide the success of nearly all new products.

But innovators are young, hip and “in” with the latest trends, right? Even if product strategy is under your wing of responsibility (likely is not), are you able to put your finger on what your customers want? More importantly, how do you know what they need?

Enter the era of the increasingly enabled, vocal and ready-to-help customer (hand-in-hand with their virtual soapboxes). As Dion Hinchcliffe notes, “The general concept is that managing customer relationships in the classical way, meaning transactionally and one-on-one can be greatly improved by making the relationship less structured, more participatory and created around an open community model.”

Social CRM replacing traditional CRM

Customer relationship management, or CRM, has been around for a long, long time. Since before the days of the first customer service hotlines, companies saw the value in supporting their customers’ needs. With the introduction of the Web, companies began mining those relationships for insight on product development. Now that social media and networks are pervasive in the mainstream, average consumers expect deeper and more frequent interaction – enter the era of social CRM, a strategy built around collaboration and customer engagement, rather than the traditional operational customer management.

Breant Leary explains, “Social CRM is growing out of a completely different need – the need to attract the attention of those using the Internet to find answers to business challenges they are trying to overcome. And nothing captivates the attention of searchers like relevant, compelling content.”

So how does this equate to innovation? Companies who are adopting such technologies are providing a direct portal to communicate with and learn from their customers – garnering end-user insight about solutions to problems and recommendations for products, subsequently catalyzing “why didn’t I think of that” innovations.

What does this mean? It means the people who are most involved with your product want to tell you what they like, do not like and where improvements can be made. In simple terms, think customer service meets research and development meets absolute stake-holder honesty.

The challenge then is transforming your community of customers into tangible members of your organization – although some customer communities may self-organize, the vendor or organization has the opportunity to create a forum for interaction, collaboration and innovative idea generation.

So how do you get started? What are the best tools? How do you know if social CRM is right for you? How do you know if your organization is ready for the weight of a collaborative customer community?

We’ll highlight great case studies of customer communities and social CRM platforms at work – detailing how they were implemented, the results companies have experienced and insight about the future of the customer’s virtual influence.