Social networking and customer relationship management (CRM) may not be a combination you immediately put together when you think in terms of customer retention. If you are operating in this consumer space today, however, this is definitely a connection you should make and learn to leverage if you hope to lead your industry.
According to this recent Fast Forward blog, Gartner (News - Alert) (News - Alert) has eliminated some of the skepticism in this area by releasing its own prediction that the CRM market will enter what it refers to as a “three-year shake up.”
This new era will begin in 2011 and will usher in a number of key trends that are likely to grab hold of the industry.
Rapid changes are also expected to be readily seen in sales, marketing, customer service technologies, projects and implementations. Gartner analyst Ed Thompson noted that over the next three years, social CRM will continue with its exponential growth, SaaS (News - Alert) will become routine, salesforce.com will reshuffle the order of the market, and consultants and system integrators will sell their own CRM software.
Gartner also predicts that by 2015, one-third of the spending that is done on CRM software will be SaaS. To demonstrate where analysts are grabbing their numbers, 24 percent of the CRM market was delivered by SaaS in 2009, with more than 26 percent delivered in this method in 2010. In 1999, CRM implementations were anything but on-premise implementations.
Spending on social software is also expected to exceed $1 billion globally by 2013, according to Gartner. The firm has also projected that overall spending on CRM software will exceed $12 billion in 2012, meaning social CRM will encompass roughly 8 percent of all CRM spending in 2012, an increase from 4 percent in 2010.
To demonstrate the reach social CRM already has in the market, TMCnet reported that Constant Contact, an online marketing company for small- and midsize businesses, has announced the acquisition of social-media Customer Relationship Management (CRM) company Bantam Live for $15 million.
For those companies interested in social CRM solutions, Gartner does have a few recommendations, such as determining whether or not there are already social CRM projects in place by looking in marketing or customer service departments first. Companies should also calculate the likelihood that they will be forced to start something in 2011 according to the industry and the company culture.
Gartner also suggests that the company find specific case studies according to industry that can provide examples of what is possible and share them with key decision makers. And, most importantly, Gartner recommends that the organization not try and bypass the IT organization when making the move to social CRM to avoid issues with data integration and to address potential concerns regarding inadequate security, privacy and scalability.
Susan J. Campbell is a contributing editor for TMCnet and has also written for eastbiz.com. To read more of Susan’s articles, please visit her columnist page.
Edited by Janice McDuffee