More than half of companies are likely to establish online communities to help them with their CRM initiatives by next year, but poor management may cause many of these projects to backfire, according to new research from analyst firm Gartner.
The firm's new report, The Business Impact of Social Computing on CRM, predicts that by 2010, more than 60 per cent of Fortune 1,000 companies will have some form of online community that can be used for customer relationship purposes.
However, if firms rush into such projects without clearly defining the benefits for customers and the business, they are likely to fail and end up eroding customer trust, according to the report author, Adam Sarner.
“Social applications offer a great opportunity for CRM practitioners to improve customer experience and influence the customer, particularly in an economic downturn when companies are trying to keep customers and increase wallet share,” he said.
“Investments should focus primarily on the customer online buying process where it can offer a direct return on investment in terms of sales, awareness and customer loyalty.”
The report outlined key steps to successfully undertaking social software initiatives, including recruiting or outsourcing skills which focus on " influencing social interactions to encourage participation effectively".
Firms must also use social reputation technologies in order to allow users to rank the quality of input provided by contributors, filter content and differentiate the best information, said the report.
Gartner recommended that organisations apply ground rules to install self-moderation, solicit feedback to make users feel appreciated, and assign an advocate to liaise with the community and represent it to the company.
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