A careful balance: Corporate participation in online community

Online community members expect that businesses with whom they engage (or about whose products or services they network) will play some role in, or even facilitate, online dialogue. But for the business this role is a balancing act. Too much content, too much moderation or too much control will negatively affect both attitudes and traffic—to the detriment of the business.

Perhaps it is in part my affection for tex-mex, but I really like the Nacho Analogy.

Feller, K. (2008, 28 May 2008). The Chip-to-Cheese Ratio: when are corporate communities too commercial? Conversations Matter.

Is CRM 2.0 something new?

CRM has been regarded overall as a movement that is tremendously powerful—but predominantly unsuccessful.

No significant flaws have been revealed in the concepts underlying CRM, but rather the ability or willingness of leaders and organisations to successfully undertake CRM has been found lacking. Many authors regard CRM as, simply, a good set of tools and concepts whose application has been conducted poorly by a preponderance of businesses (White, 2003; Xu, Yen, Lin, & Chou, 2002).

“50 percent of leading brands’ heaviest buyers one year are typically not in that same group the following year, with a significant number of them leaving the brand altogether. This reveals a stunning opportunity to do a better job of raising customer commitment levels beyond those being achieved currently” (Rapacz & Reilly, 2008).

Frederick Newell is one author who is deeply critical of CRM’s track record, and quite early in the emergence of web 2.0 he proposed another re-badging of the field:

CMR (Customer Management of Relationships).

“In the world of CMR the power of defining the relationship transfers to the customer. Customers will engage in different types of dialog with suppliers, often being the ones to initiate the search for a solution. The concepts of self-service give the customer more control; the seller no longer mandates the process. There will still be targeting, but the customer may choose the target firm. In this topsy-turvy CMR world, the customer will tell us what she is interested in and not interested in, what kind of information she wants, what level of service she wants to receive, and how she wants us to communicate with her—where, when, and how often” (Newell, 2003).

Newell, and the earliest web-savvy consumers, were onto something. CMR is a concept that reappears throughout contemporary discussions of CRM 2.0.

Marketing and CRM authors have recently begun to acknowledge that the relationship is not only controlled by the consumer, but relate the quality and responsiveness of these relationships, including businesses’ consideration of customers’ needs and behaviours, to brand experience. It is noted that even for businesses pursuing sales or marketing perspectives on their business, ultimately it is customers who manage relationships, and that non-responsive or exploitive approaches to CRM can blind managers to this fact (which we might say would inherently represent a lack of consumer orientation, which we will discuss in a later section of this paper) (Ford & Nicks, 2003).

Ford proposes an integrated framework for uniting brand experience, creation/exploitation of customer relationships, and incorporating customers’ and companies’ perspectives.

“power lies with the customer and it is only by looking at markets through their eyes that businesses will succeed in building relationships” (Ford & Nicks, 2003).

Even this point, though, like the earlier dialog about relational strategies supplanting transactional strategies, becomes only a partial step to the end that is called up in the age of the social web. CRM (and IMC) perspectives on relational strategies focussed on collecting a broad range of consumer information in order to strategise and improve targeting. Discussions of this concept by authors such as Zahay retain the notion that consumer information is collected as a function of CRM in order to adjust the ways that businesses command and control their marketing efforts to maximise returns (Zahay, Peltier, Schultz, & Griffin, 2004). The further step implicit in CRM 2.0 is that control over a business’s purpose and function is largely handed over to the consumer.

The online wiki collaboration created by Paul Greenberg toward the development of the fourth edition of his book CRM at the Speed of Light, rather than helping to advance a distinct new practice, may serve to highlight some of the futility of re-naming the field. After extensive tabling and before-and-after comparisons, each of Greenberg’s points comes back to the same fundamental Web 2.0 ideas: Customers are given control of conversations, and their inputs are acted upon.

“CRM 2.0 is a business philosophy and strategy that fosters mutually beneficial conversations with customers through technology platforms, business rules, business processes, and social characteristics. It is the company’s response to the customer’s ownership of the conversation” (Greenberg, 2008).

Is CRM 2.0 anything new?

With CRM having a strong background in championing customer relationships, breaking of internal silos and overall consumer orientation, CRM stood in relatively strong stead as we shifted into the era of the social web.

Accounting for a new emphasis on consumer orientation and consumer control of communication, is CRM 2.0 a worthwhile re-naming of the field?

I suggest this is only the case if real orientation to consumers—and the adoption of an organisation-spanning mission to act on that orientation—are issues that fall solely within the domain of CRM. None of the literature or commentary appears to provide a reason that this might be so. CRM is a useful and necessary function, and its relevance is increased where businesses are conducted online, but the fundamental lessons and theory of CRM are really lessons for executive-level management. Every ‘foot soldier’ in an organisation needn’t be a CRM (or IMC) guru in order for the business to have a practical orientation toward its consumers—a general acceptance by executives and managers will lead to the right people gaining those skills and attitudes.

This post is part of a developing series:

1. Web 2.0 Marketing: Consumers’ online behaviours boost brand engagement
2. Does the 2.0 revolution warrant renaming business functions?
3. Definitions and critical success factors for CRM
4. Is CRM 2.0 something new? (You are here)
5. What is Marketing 2.0?

References

Ford, K., & Nicks, G. (2003). CRM And New Marketing: How Do We Capture The Customer Experience? Paper presented at the Market Research Society Annual Conference.

Greenberg, P. (2008). Authoring Wiki for “CRM at the Speed of Light, 4th Edition”. http://crmsol.pbwiki.com

Newell, F. (2003). Why CRM Doesn’t Work : How to Win by Letting Customers Manage the Relationship: Bloomberg Press

Rapacz, D., & Reilly, M. (2008). The New View of Relationship Marketing: Better integration to deepen brand commitment. Journal of Integrated Marketing Communications (2008), 19-25.

White, R. (2003). Customer Relationship Management. WARC Best Practice, September 2003.

Xu, Y., Yen, D. C., Lin, B., & Chou, D. C. (2002). Adopting customer relationship management technology. Industrial Management and Data Systems, 102(8/9), 442.

Zahay, D., Peltier, J., Schultz, D. E., & Griffin, A. (2004). The role of transactional versus relational data in IMC programs: Bringing customer data together. Journal of Advertising Research, 44(1), 3-18.

Does the 2.0 revolution warrant renaming business functions?

Does the business world need Marketing 2.0, CRM 2.0, and even IMC 2.0—or just ‘Customers 2.0’?

Recent changes in internet functionality and consumer online behaviour, originally described as a far-reaching change in internet communications and colloquially titled “web 2.0” by Tim O’Reilly, involve (in part) a shift from an internet serving as a largely broadcast-structured one-directional medium to an internet where users contribute and collaborate extensively. The most apparent, current hallmarks of this shift include the exploding popularity of online networking, blogs, social communities and a general increase in the level of interactivity available online. Many successful commercial websites have embraced the trend by encouraging customers to contribute content in blogs, reviews, forums and other online facilities. Video games have evolved to include team collaboration and real-time communication among any number of remotely-located players.

Web 2.0 pundits suggest that this shift in online behaviour indicates a crucial new direction in consumer behaviour that entails a pervasive and growing expectation on the part of consumers that they should be able to engage with and contribute to whatever communities or entities they make contact with online.

That this appears to be borne out by the very nature of many online success stories—businesses such as Flickr, Facebook and Amazon—has led some in the business community to consider 2.0 trends as a pivotal shift that calls for a redesign or redefinition of business functions such as customer relationship management (CRM), public relations (PR) and marketing.

The lessons that are extracted from these changes, however, reflect in many respects established theory and practice in each field. In fact, lessons for business that are being touted as changes necessitated by the advent of web 2.0 echo some of the key lessons highlighted in the field of CRM for many, many years. The past two decades’ literature on the design, implementation and conduct of CRM overlaps extensively with ‘2.0’ ideas, and these overlapping indications appear to revolve somewhat upon consumer orientation.

Web 2.0 is described by some as a revolution that necessitates a significant redesign of communication with commercially important audiences. This has led some writers to suggest that new fields of thought and practice, with new titles such as ‘Marketing 2.0’, ‘CRM 2.0’ and ‘PR 2.0’, should be adopted to denote the differences to traditional practice.

Is a shift in the field of IMC toward a new era of ‘IMC 2.0’ called for, or would this essentially be giving a new name to pre-existing best theory and best practice in marketing communications?

In my next several posts I will review CRM, CRM 2.0, Marketing 2.0 and the current state of IMC—let’s see if this leads us toward IMC 2.0…

This post is part of a developing series:

1. Web 2.0 Marketing: Consumers’ online behaviours boost brand engagement
2. Does the 2.0 revolution warrant renaming business functions? (you are here)
3. Definitions and critical success factors for CRM
4. Is CRM 2.0 something new?
   
5. What is Marketing 2.0?