Over the past year, I have posted some perspectives on the emerging concept of “Social CRM,” which introduces the potential to not only mine data and insights from social networks, but also partner with influential customers or partners to better connect with important markets.
At a panel discussion at the recent NetSuite confab, participants speculated how close companies have advanced toward the ideals of the “social business,” built and powered by engaged, interconnected employees, partners and customers. The consensus seems to be that companies are getting tripped up figuring out the returns they may or may not be getting, whether management is embracing social and whether what they have is really social at all.
Adam Sarner, research director at Gartner, recently published his observations on the elusive benefits of social, predicting that by the end of this year, only 50 percent of Fortune 1000 companies will receive a worthwhile ROI from their social CRM initiatives.
Initially, social CRM was mostly a concern of marketing, but it now affects every discipline, from marketing and sales to customer service and support. Social CRM is increasingly important to lead generation and cross-selling and up-selling capabilities, and to other functions that are key to successful sales organizations.
Although the adoption of social applications by sales, marketing and customer service departments continues to grow rapidly, “for the 50 percent of Fortune 1000 organizations not determining—or even measuring—ROI, ignorance will mean failed projects." Sarner goes on to predict that “among the companies who will not see a worthwhile return, only 20 percent will even have the data to evaluate where their social strategy is falling short. These organizations will be unable to justify future funding.”
During the next two years, the success of social CRM will depend on how well companies and social CRM technology providers can make social CRM projects more than just social objectives by tying them to clear and measurable business objectives. Gartner predicts that by the end of 2012 three-quarters of new social CRM initiatives that receive funding will have a business case incorporating measurable ROI.
“Social data, such as numbers of fan pages and weekly Tweets, is not enough to correlate with the contribution of top business objectives,” said Sarner. “ROI, measurable business value and budget justification for social projects are becoming unavoidable topics for many organizations.”
Gartner projects that the worldwide market for social CRM software licenses and subscriptions to total $2.1 billion in 2012, up from 850 million in 2011, and that social CRM revenue will represent 10 percent of the overall CRM market. Business-to-business applications for sales use will have the fastest growth and will account for 30 percent of social CRM spending by 2015, up from 5 percent in 2011.
Joe McKendrick is an author, consultant, blogger and frequent INN contributor specializing in information technology.
Readers are encouraged to respond to Joe using the “Add Your Comments” box below. He can also be reached at firstname.lastname@example.org.
This blog was exclusively written for Insurance Networking News. It may not be reposted or reused without permission from Insurance Networking News.
The opinions of bloggers on www.insurancenetworking.com do not necessarily reflect those of Insurance Networking News.
Register or login for access to this item and much more
All Digital Insurance content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access