Third Idea Consulting

[Disclaimer: Sword Ciboodle is a client of mine, and I'm posting this in response to a request from my liaison and friend Mitch Lieberman. While that's the motivation, the opinions in this post are my own, and I have editorial control.]

Customer experience is a term that covers a lot of ground. Some get into the meta-experience of being a customer in a world where businesses compete loudly and intrusively for attention. Others use it to describe the look and feel of a brand when customers interact with it—what it means and how it feels to be a customer of that company.

I’m on board with those, but I am an especial fan of a third idea (imagine that!) related more to the second than to the first. Customer experience in this case is what a customer must go through to be your customer. Practically speaking, what happens when they have a question or comment? How often do you expect them to want to hear from you, or to reach out to you? What do your customers say about you to each other? Most importantly, what do they want from the relationship?

The good people at Sword Ciboodle have turned out a white paper on the topic of Total Customer Experience. You can see the paper on their site at the previous link, or here on Customerthink. Not surprisingly, Ciboodle gets it right.

The paper leads with an important figure: 86 percent of consumers quit doing business with a company because of a bad customer experience, up from 59 percent four years ago. That’s taken from the Harris Interactive Customer Experience Impact Report, an important study that I and many of my colleagues refer to each year it comes out. Customers are getting more frustrated with companies’ attempts to get and hold their attention, and are less forgiving than ever.

Why, you may ask? The old standard from Cool Hand Luke: failure to communicate.Another telling figure, this one from the IBM 2010 Global CEO Study, is that 88 percent of CEOs said “Getting closer to customers” is their top priority for their business over the next five years. As the following chart from that study shows, this is probably a Bad Idea.

Customers and businesses are different animals. As much as we talk about community, co-creation of value, and relationships, the fact remains that there is a power imbalance. Customers hold all the power; they do not want you to get closer to them unless it is to give them what they want. And the bad-experience figure quoted above shows that customers are readier than ever to drop you like a wet hairball if you cross them.

The Ciboodle paper goes on to discuss how to allow for the disparity in customer and executive priorities—how to get closer by giving customers what they want, how they want it. I won’t spoil it for you—it’s twelve pages of good work, and I want you to read the whole thing, not just my opinion of it—but there are some key points to consider.

Be sure you know where your customers are and what they value;

Be sure that your infrastructure is in place and your fundamentals are sound; and

Be cautious of the shiny new objects which can distract you from youre core customer service focus.

The bit about shiny new objects is especially important. Of course the other two points are as well, because if you don’t know your customers and have the means to serve them, you’re in more trouble than a white paper can solve. But we have all fallen in love with the possibilities of social CRM, and what we can do with the technology that enables it. Those tools are a means to an end, not an end in themselves; if they don’t first answer the core need of serving customers, they have no place in your company. Integrating new tools with your existing CRM approach must be done in a way that doesn’t annoy your customers, or they won’t be your customers anymore.

Have you ever noticed how all the talk in the CRM sphere tends to focus on a handful of big names? The companies that have already achieved massive success and recognition (relatively speaking; I still need to explain the concept of CRM and SCRM to just about everybody I meet)? It seems there’s no room for smaller vendors to compete, despite the fresh approaches and innovative ideas they may bring.

That state of affairs is a thing of the past. Once again, Paul “CRM Godfather” Greenberg is shaking up the industry—he has masterminded CRM Idol 2011: The Open Season. As the name suggests, it’s something of a riff on American Idol, but with more talent and less drama. Entries are being accepted, starting today; more about that later.

A total of 60 companies (40 in North America, 20 in EMEA) will present their commercially-available CRM wares to a panel of judges composed of the greatest influencers, analysts, and journalists in the field (and also me). Finalists chosen from these vendors will create a 10-minute video presentation to fight it out for a choice of the top prizes.

The prizes, you ask? Several. Free consulting from members of the judging panel and other top minds in the field. Webinars conducted pro bono by the same. Subscriptions and/or beta access to leading CRM suites so partner applications and integrations can be developed. And the coveted free publicity, consisting of a joint product review produced and signed by the judging panel, released immediately through a huge list of media partners.

And since everybody’s a winner in a game like this, everybody gets the review. Like American Idol, though, there is a risk of the Simon Cowell experience—a weak product and a bad presentation will be reviewed appropriately.

But enough of my paraphrasing and editorializing—you want the meat of the subject. Here it is, straight from Paul:

The Idea

Most of what we’re trying to do was outlined in the pre-announcement announcement of CRM Idol last week. But it bears some repeating:

Small companies – at least in the CRM software related world – and that means social software world, in this case, too – abound. There are thousands of companies out there that are possibly innovative, possibly commercially viable in a big way, possibly the next big thing. But, as we said, there are thousands of them. And, no matter how great your product is, if no one knows about it, well, then, oops. Not a good thing.

These small companies are all making efforts to get into the ecosystem that could benefit them – one which includes investors, influencers, technology/strategic partners, media connections, etc. While getting support from this powerful ecosystem is by no means a guarantee of success, it can be enormously helpful in getting well down the road there. But, those small companies are often thwarted in that effort by either really bad PR people, or just the incredible amount of companies out there trying to reach into the ecosystem who are pummeling the small amount of influencers, etc. every week with requests to demo or talk.

Now, to be fair to the influencers, they are human beings with lives that aren’t built around supporting this one company that really thinks they are it. All they know is that each of them is getting between 20-50 requests a week to take a demo or conversation with someone who owns or represents a company they’ve never heard of and never talked to yet. In addition to those that they know. Often enough, they are pitched by a public relations person who is either inexperienced or not really good at their job who makes no effort to find anything out about the person that they are pitching to. So the influencer, journalist, venture capitalist gets a generic curve thrown at them that doesn’t even break over the plate – guaranteeing that the email is going to be discarded as a matter of course before the first paragraph is even read. Or it could be that on a particular day the influencer got 10 pitches and had a headache and didn’t want to see any of them.

As unfair as generic pitches and high volumes of noise are to the influencers in the highly desirable ecosystem we are chatting about here, it is a problem because what are probably a lot of good companies are never given a chance to move ahead because of the difficulties inherent in the process and the vagaries of bad luck on any given day.

Which is why CRM Idol 2011: The Open Season exists.

The concept is simple, small companies out there. If you meet the submission criteria outlined below, you will be given the opportunity, first come first serve, to secure a time slot on a specific day that will put you in front of some of the most influential people in the CRM/SCRM world. They will spend an hour with you in a demo to hear about your technology product – software only – and they will write a jointly signed review of what they saw of you – that will be published in multiple venues as soon as its written. It can be a good review, a bad one, a mix or indifferent. There’s risk on your part to be taken here. But it is something that you need to be aware of. The reviews will go up as soon as the 5 judge sign off on the final content. They won’t be exhaustive reviews but they will be opinionated and fair.

Forty companies from the Americas and twenty companies from EMEA (that means ONLY Europe, the Middle East and Africa) will get a shot at this – again first come first serve (more later on what that means). Of the 40 in the Americas, 4 finalists will be chosen. (NOTE: There will be an APAC edition hopefully late in the year or if not, early 2012, depending on the success of these two events. Sorry, Asia, Australia, New Zealand, et.al. Logistics made it impossible at this juncture.) Out of the 20 in EMEA, 3 finalists will be chosen. Each of the finalists will be REQUIRED to do a ten minute video about their company and the product. Not a repeat of the demo but a video. Note I used the word REQUIRED here. Let me put it this way. If you make the finals and don’t do the video, we will publicly skewer your company. Know why? Because our judges are giving up what little free time they actually have in a summer to do this and it will take us 4 hours a day for 3 business weeks to do it. So if you can’t or won’t put in the effort to do the video, don’t bother to apply. Seriously. We’re trying to help out here and we want you guys all to succeed but it’s a two way street.

Okay, that rant out of the way. Once the finalists are chosen and the videos done, they will be posted online in multiple media outlets. They will be voted on in two ways:

1. 1. Popular vote – see, crowdsourcing is important. All the votes for the one winner from the Americas and the one winner from EMEA will be tallied from the public sites – in aggregate. That’s 50% of the vote.
   2. Extended Judges Panels – as you can see below, we may have assembled the greatest panels of judges – both leading vendors and influencers ever assembled in the history of CRM – not to be hyperbolic or anything. Each judge will select a specific winner in each of the Americas and EMEA from the 7 finalists. That’s the other 50% of the vote. The original judges will be voting as panel members.

The winners in each will get a major array of prizes, some of which are below, and be declared “CRM Idol 2011 Winner.”

Not too shabby is it? Vast amounts of media attention even if you don’t make the finals. If you make the finals at all, some prizes to you. The winners get everything that the ecosystem can offer but guaranteed success. But they do get all the accoutrements they need to support their increased likelihood of it.

That way, you small companies out there who have been victimized by bad approaches or just circumstance have the opportunity to bypass all of that and make something happen. It’s up to you to take the reins in hand but once you do, you have at least a serious chance at making yourself successful.

The Criteria

This competition is for small companies in the CRMish/SocialCRMish world. – see the categories below for some guidelines though please feel free to make the case if you don’t see yourself in the guidelines.

1. 1. You have to have software that is commercially available by the time of the demo – that would be in August – again see below. No betas, alphas, release candidates allowed. If we find that you’re not commercially available, and you have a time slot, you’re out and someone else will fill the slot. So please be sure that you can verify the claim if you want to participate.
   2. You have to have 3 referenceable customers that, if we care to, we can contact and ask about you.
   3. You have to have revenue under $12 million U.S. your last fiscal year. As far as disclosure goes, you have the choice of making the claim that you do – though that will have to be stated in your submission and we’ll trust you or you can disclose your revenue in the submission with the knowledge that only the permanent judges will know what it is. If you make the claim, please be prepared to back it up if we ask. Your call on how.
   4. You have to be willing to make a ten minute video if you get to the finals. More on that later.
   5. You have to fit a category – though there is some leeway there.

The Categories

The categories that we’ve identified to start are:

1. 1. Traditional CRM Suites
   2. Social CRM
   3. Sales - Sales Force Automation, Sales Optimization, Sales Effectiveness
   4. Marketing – Marketing Automation, Revenue Performance Management, Social Marketing, Email Marketing, Enterprise Marketing Management, Database Marketing
   5. Customer Service – all permutations
   6. Mobile CRM
   7. Customer Experience Management
   8. Social Media Monitoring – requires the possibility of integrating with a CRM technology
   9. Customer Analytics – including text/sentiment analytics; voice based analytics; social media analytics, influencer scoring, etc.
   10. Enterprise Feedback Management
   11. Innovation Management
   12. Community Platforms
   13. Enterprise 2.0 – collaboration, activity streams etc.
   14. Social Business
   15. Knowledge Management – this one requires the possibility of integrating with CRM systems
   16. Vendor Relationship Management
   17. Partner Relationship Management

Once again, if you don’t see yourself in this list, don’t worry. Just make the case as to why you have some customer-facing possibilities and the likelihood is that we’ll be cool with it. We’re trying to make this easier for you, not hard.

The Rules

They are numbered to be entirely clear.

Submissions

1. 1. There will be 40 slots made available in the Americas and 20 in EMEA.
   2. The submission will be by email ONLY to: [email protected]. (See below to see this again and what to do if there are problems). Any other attempt at submission will be rejected out of hand with the problem exception mentioned below.
   3. The submissions will occur starting today – Monday, April 25 and will continue until Friday May 13 or until all slots are filled, whichever is first (watch #crmidol on twitter for updates on that as it occurs). On May 13, should any slots be left, the remaining specific dates and times will be made publicly available and another final round of submissions for those remaining slots will occur from May 13 through May 20. After that the submissions will be closed.
   4. Each submission will include the following:
      • Your company contact and named person contact information Two date and time specific slot requests. ONLY two. If your slots are not available, you’re out of luck until May 14 – and then you can resubmit to any time slots that are publicly announced as still available. Though there is no guarantee that there will be any available slots at that time. (see below for examples of how to submit the dates/times)
      • The category you feel you fit into - or if you don’t but think that you qualify – why.
      • A description of what the product is/the company is. Be persuasive here that you meet the criteria, not that you have a great product. This is merely a qualifying discussion. URLs cannot be used as substitutes for this description. The submission needs to be all inclusive. However, they can be used as supporting documentation.
      • The names of the three (3) referenceable customers – the company, the contact and the way to communicate with them – minimum of email and phone, please.
      • A statement that says that you meet the revenue requirement along the lines of “our company states truthfully that our revenues in our last fiscal year 2010 were under $12 million U.S”. OR you can state the actual number with the knowledge that the primary judges in each of the Americas and EMEA will treat it as under non-disclosure. But please be aware those designated primary judges below will see the actual figures if you choose to reveal them.
      • A statement that says, “if (you) make the finals, you are committed to making a 10 minute video for submission and public viewing as part of the conditions for entry.” Word it anyway you prefer but make the commitment clear.
   5. If you are accepted, you’ll be notified privately but it will be posted that you’ve been accepted on the Twitter #crmidol stream. The time will only be sent to you privately. Just your acceptance will be posted. Please allow some time between your submission and the posting of it to the hashtag and your private notification, since we all still have to work for a living.
   6. If you don’t include everything specified in the rules for submission, it means automatic disqualification and you cannot resubmit.

The Demo

The demo has few rules. Just be prepared to a. explain your company; b. show your product – live please c. answer questions from the influencers/experts. Not much more than that. I’m sure many of you are experienced at this already so wed don’t have to tell you this, but just in case… A site for the demos with login etc. will be announced to the timeslot owners in early August.

The Video

The standards for the video will be mentioned to the finalists once they are named. To rest any unease, you won’t be required to spend lots of money to get it done. How much you spend and on what will be up to you as will the content and how you present it. We’ll issue guidelines when the time gets near, including how the video is going to be distributed for posting and voting.

The Judges

Here are the lists of all the judges. As you can see, we have what is likely to be the heaviest hitting list in the history of anything done in CRM when it comes to awards or competitions. Click on their names to get to their LinkedIn bios. They are in alphabetical order.

Primary Judges

The Americas

These five judges will handle the 40 entries for the Americas which consists of the United States, Canada, South and Central America. They will all be involved in the one hour reviews each of the days over the two weeks and will jointly sign off on each review which will be posted to multiple media sites. They will also solely choose the four finalists for the Americas.

1. 1. Paul Greenberg – Managing Principal, The 56 Group, LLC
   2. Jesus Hoyos – Managing Partner, JesusHoyos.com, LLC
   3. Esteban Kolsky – Principal and Founder, Thinkjar LLC
   4. Brent Leary – Managing Partner, CRM Essentials
   5. Denis Pombriant – CEO, Beagle Research Group

EMEA

These four judges will handle the 20 entries from Europe, Asia, Africa, Australia etc. They will all be involved in the each of the 1 hour demos/discussions from Sept 5 through 9 and will write and jointly sign off on each review which will be posted to multiple media sites. They will also solely choose the three finalists for EMEA.

1. 1. Laurence Buchanan – Vice President, CRM & Social CRM, EMEA, Capgemini
   2. Silvana Buljan – Founder & Managing Director, Buljan & Partners
   3. Paul Greenberg – see above
   4. Mark Tamis – Social Business Strategist, NET-7

Mentors

This is an exciting part of CRM Idol 2011. Each of these fine human beings has volunteered a day of their time – two during the finals and one with the winners – to provide the benefit of their experience to the contestants. What they will do is noted by their name. This is an awesome idea that Anthony Lye actually cooked up. Each of these mentors has decades of experience in the software and venture capital world and is considered a leader in the CRM space. So if you make it to the finals, you have the benefit of their knowledge and their valuable time. Amazing.

1. 1. Anthony Lye – Anthony will provide one day for the Americas finalists and one day for the EMEA finalists for consultation on how to best do the content for the contending videos and whatever other pertinent advice the finalists need. Anthony has had years of experience as a senior management person for enterprise CRM and a thought leader.
   2. Joe Hughes – Joe will provide one day for the Americas finalists and one day for the EMEA finalists for consultation on how to best do the content for the contending videos and whatever other pertinent advice the finalists need. Joe has been a leader in the CRM space for as long as we can remember and one of the more foresighted when it comes to the value of Social CRM
   3. Larry Augustin – This is a prize for the winner of EMEA and the winner of the Americas. Larry who has years of experience as an executive in the software space and has been a successful venture capitalist will work with the winner to prepare them for dealing with possible investors including doing a VC matching with the winners.

There will most likely be other mentors announced as the competition gets closer to the demo dates. We might try to make some mentors available to prepare you if you need them for the one hour demos but that’s still up in the air. We’ll keep you posted.

Extended Judges Panels

The Influencer Panel

1. 1. William Band – Vice President & Principal Analyst, CRM, Forrester Research
   2. Jim Berkowitz – CEO, CRM Mastery
   3. Bruce Culbert – Chief Service Officer, The Pedowitz Group
   4. Zoli Erdos - Publisher/Editor, CloudAve and Enterprise Irregulars
   5. Mike Fauscette – Group Vice President, Software Business Solutions, IDC
   6. Josh Greenbaum – Principal, Enterprise Applications Consulting
   7. Dr. Graham Hill – Partner, Optima Partners
   8. Dennis Howlett - Buyer Advocate
   9. Ian Jacobs – Senior Analyst, Customer Interaction, Ovum/Datamonitor
   10. Michael Krigsman – CEO, Asuret
   11. Marshall Lager – Managing Principal, Third Idea Consulting
   12. Kate Leggett – Senior Analyst, CRM, Forrester Research
   13. Maribel Lopez – Principal Analyst and VP, Constellation Research Founder Lopez Research LLC
   14. Jeremiah Owyang -Managing Partner, Altimeter Group
   15. Sameer Patel – Managing Partner, Sovos Group
   16. Scott Rogers – Customer Evangelist
   17. Robert Scoble – Managing Director, Rackspace Hosting
   18. Brian Solis – Principal, Altimeter Group
   19. Dilip Soman – Professor of Marketing, Rotman School of Management, University of Toronto
   20. Ray Wang – CEO, Constellation Research
   21. Mary Wardley – Vice President, CRM Applications, IDC

The Vendor Panel

1. 1. Larry Augustin – CEO, SugarCRM
   2. Anthony Lye – Senior Vice President & GM, CRM, Oracle
   3. Phil Fernandez – CEO, Marketo
   4. John Hernandez – General Manager, Customer Care Business, Cisco
   5. Jonathan Hornby – Director, Worldwide Marketing, SAS
   6. Joseph Hughes - Senior Executive, CRM Service, Support and Social System Integration Lead, Accenture
   7. Charlie Isaacs, VP, eServices and Social Media Strategy Alcatel-Lucent Enterprise
   8. Vinay Iyer – Vice President, Marketing CRM, SAP
   9. Katy Keim - CMO, Lithium
   10. Marcel Lebrun,- CEO, Radian6
   11. Mitch Lieberman, Vice President, Marketing, Sword-Ciboodle
   12. Chris Morace- Senior Vice President, Business Development, Jive
   13. Zach Nelson – CEO, NetSuite
   14. Bill Patterson- Director, CRM Product Management, Microsoft
   15. Dileep Srinivasan - AVP - CRM & Social CRM, Digital Marketing & MDM, Cognizant
   16. John Taschek –Vice President, Market Strategy, Salesforce

The Journalist Panel

1. 1. Elsa Basile – Director, Callcenternews (Argentina)
   2. Barney Beal – Managing Editor, SearchCRM,
   3. Anita Campbell – Publisher, SmallBizTrends.com
   4. Robin Carey – CEO, Social Media Today
   5. Neil Davey – Group Editor, Sift Media
   6. David Myron – Editorial Director, CRM Magazine, Speech Technology Magazine
   7. Valdir Ugalde – Board, Member, mundocontact (Mexico)
   8. Ann Van Den Berg – Senior Editor, CustomerTalk (Netherlands)

Media Partners

You’ll note that we have 8 journalists on a panel of judges. Well, each of them represents a media partner that will be broadcasting the competition and posting the videos for voting in the finals for the popular vote. They are an awesome array of the most influential media sites in social media, CRM, and small business as well as local influencers in CRM in Latin America and Europe. They will be significant in the lives of the contestants, the finalists, and the winners giving each what may be an unprecedented breadth and depth of coverage. Their coverage will be supplemented by posts to the blogs and other sites that are owned by many of the judges so there will be significant reach for all 60 of the initial contenders. Each of these partners will be getting exclusives from the judges and hopefully some of the companies too so that we can add a quality of coverage that would enhance the value to the SMBs participating. in all areas – CRM, social and small business directly.

We expect to add more media partners as we continue on throughout the competition.

The current partners and links to their sites (in alphabetical order, like every list here):

1. 1. Call Center News (Argentina)
   2. CRM Magazine/DestinationCRM
   3. CustomerTalk (Netherlands)
   4. Mundocontact (Mexico)
   5. MyCustomer.com/Sift Media
   6. SearchCRM
   7. Social Media Today
   8. SmallBizTrends.com

The Prizes…So Far

These are the prizes as of launch today. There are several others in the works that will be announced as the contest rolls out.

All Finalists

All 7 finalists will get to choose one day of consulting from the list of Influencer consultants below. The order of choice will be based on the popular vote on the video which will be kept confidential but used for the choosing. There will be more consultants added to the list as contest moves forward.

The Americas and EMEA Winners

Each winner will get to choose four prizes from the list. Note – in the case where multiple prizes are being offered by a single vendor – the vendor counts as a single prize with all the items as part of that.

1. 1. Accenture
      1. A full day workshop with CRM leaders in Accenture for possible partnership and/or possible investment.
   2. Capgemini (for EMEA winners only)
      1. A half day workshop with Patrick James, Global VP CRM and Laurence Buchanan to explore joint go to market opportunities and help you refine and test your value proposition.
   3. Social Media Today
      1. A blog post featuring the winner of the contest to run on both The Customer Collective and Social Media Today
      2. A single blast to the Social Media Today opt-in list (approximately 50,000 names) which will conform to their minimum standards (valued at $10,500)
   4. Microsoft
      1. 12 mos. of CRM Online Free for developing extensions to CRM
      2. 12 mos. of Windows Azure Free for developing web-based portals and BI solutions
      3. Access to the Office 365 Beta for building collaborative applications and services
      4. Access to the BizSpark One program -a program designed to connect emerging businesses and their investors with a Microsoft advisor to help them identify unique opportunities and expand its business presence
   5. SugarCRM
      1. Free 10 user subscription to SugarCRM Professional or Enterprise
      2. Membership in the Sugar Exchange and free consulting on product integration with SugarCRM
      3. CEO Larry Augustin, a successful venture capitalist in his own right, does a mentoring & VC matchmaking session with the winners
   6. Brian Solis
      1. One hour internal webinar on how to use SCRM and social media to your advantage
   7. Paul Greenberg
      1. One hour pro bono external webinar on a subject TBD for lead gen, mindshare, etc.
   8. Ray Wang
      1. One hour pro bono external webinar on a subject TBD for lead gen, mindshare, etc.
   9. Sameer Patel
      1. One hour pro bono external webinar on a subject TBD for lead gen, mindshare, etc.
   10. Influencer Consulting– free strategic consulting for 1 day or 8 hours from a variety of judges (in person travel expenses to be covered by winners)
   11. Esteban Kolsky (in person only)
   12. Paul Greenberg (on phone or in person)
   13. Denis Pombriant (on phone or in person)
   14. Mark Tamis (on phone or in person)
   15. Jesus Hoyos (on phone or in person)
   16. Brent Leary (on phone or in person)

The Times, Dates, Hashtag and Email

Okay here’s the hardcore stuff:

1. 1. The hashtag is #crmidol
   2. The email for submission is [email protected]
   3. If you have a problem submitting to that email send your submission and a report of the specific problem to [email protected]

Dates and Times Table for the Americas and EMEA

We’ve put together an easy little table with all the relevant dates and times that you’ll need as you progress through the competition.

Dates/Times	Americas	EMEA
Submission Dates	August 15-19; August 22-26	September 5-9
Submission Times	3pm ET; 4pm ET; 5pm ET; 6pm ET	3pm GMT; 4pm GMT; 5pm GMT; 6pm GMT
Finalist Video Submission Date	September 30	October 14
Winner Announcement	October 17	October 31

A Note or Two

A little bit of unfinished stuff that will sort itself out as time goes forward.

• • There will likely be a CRM Idol site (Joomla based) coming in the next month or so that will be an aggregate site for all the media outlets and streams. However, this remains a work in progress that’s still under discussion.
  • There will be more mentors and prizes added and possibly a judge or two.
  • For now ongoing news will be found at the twitter hashtag #crimidol.

In Closing

That’s about it. Now its time to bring it. First come, first serve. See you, maybe as the 1st ever CRM Idol, in Vegas, Hollywood. London or on the Social Web. Somewhere anyway.

CRM IDOL 2011 IS NOW OFFICIALLY UNDERWAY

Hey, just a quick update to let you all know that a book I worked on is now available for preorder on Amazon. Dancing with Digital Natives: Staying in Step with the Generation That’s Transforming the Way Business Is Done has been a long time in coming, and I think I speak for all the authors and editors when I say how gratifying it is to see it in print.

My chapter deals, surprisingly enough, with social CRM and how business can use it to form close bonds with the digital customer, as well as how businesses are built upon social principles. There’s a load of good stuff from other contributors as well, so expect to learn from pages I’m not even responsible for. ^_^

Yes, I did just use a Japanese-style emoticon on my professional blog. I like them, and the regular ones screw up my formatting.

Many of you know that I come from a print media background—mostly magazines, with a few books shuffled in. While I’ve moved on in my career to a place where most of my work seems to be electronic in nature—blogging, ebooks, social networking—I still have a soft spot for words on dead trees. So whenever somebody says that books, magazines, or newspapers are dying forms of media, I have to speak up.

Of course, nobody’s actually said that to me recently, so I need to stretch a bit. Just the other week, this brilliant video posted all over the Interwebs. While it turns out that it was prepared by a unit of Penguin Publishing, the message is no less valid. Make sure you watch and listen to the whole thing before you make up your mind.

Yes, it’s on YouTube. Yes, social networking has been a big deal long enough to go from fad to trend to established communication form. But there still has to be something to talk about. One can only get so deep into philosophy, current events, science, and art with Facebook or Buzz status updates. There will always be a place for physical media. These are major sources for big ideas.

New media can be the start of great print too. Social networking is a thousand different sociology experiments writ large, all happening at once. Good information on human behavior is there for the observing. Journalists get leads from Web sources all the time. And who’s to say that a hot exchange of tweets won’t inspire the next great novel—or that a blog won’t help us find out about it?

Sure, circulation and ad revenue are down, but that’s just good news for the trees. Executives must learn that the socialverse isn’t going away, and adjust print’s business practices to reflect this fact. I don’t have the answer yet, nor do they, but we’re working on it.

I’ve never been the most social guy, which makes it ironic that I make my living through consulting on social media. I’ll be saying as much in my June Pint of View column for CRM magazine, but I wanted to get out in front of it with this. Social CRM and community software vendor Lithium—specifically Dr. Michael Wu, Lithium’s principal scientist of analytics—just released a study of Lithium customers that sheds light on just who participates in online communities.

Conventional wisdom states that 90 percent of online community members are passive participants, or lurkers; they monitor the content and events but don’t contribute. The next 9 percent are active participants who post and engage with some regularity. But the majority of activity in the community comes from just 1 percent of members, called hypercontributors (or grognards, to some). This is sometimes known as the 1-Percent Rule. Conventional wisdom isn’t always wise, so Wu set about putting numbers to the theory.

It’s hard to get decent data on how non-participants contribute to a community—it’s like proving an unbounded negative—so the study focuses on the top 10 percent of community contributors. Lurkers aside, it turns out that conventional wisdom is actually wise: The hypercontributors in the top 1 percent create an average of 56 percent of community content, with the rest coming from regular contributors in the next 9 percentiles.

There’s more to it than this brief outline, and I recommend reading the study results in depth. Knowing your audience is key to serving it.

I ran across an amusing little incident (via MetaFilter) that happened recently in San Francisco, and I felt I needed to share. Members of the Fred Phelps-led Westboro Baptist Church gathered recently for a protest outside the offices of Twitter. I’m going to be smart and stay well clear of discussing the ministry, its protest signs, or the counter-protest to their small rally—you can read and see more of that at either of these not-safe-for-work links—but I have to address what one of the protesters was reported to have said. To quote the Asylum article by Harmon Leon:

As the verbal assault continued, I raised my hand and asked the obvious: “Why Twitter? Does God hate Twitter?”

“We have not quarrels with Twitter. Twitter is a great platform,” stated a gray-haired WBC woman juggling several signs that could be interpreted as funny and ironic if they were actually funny and ironic. Gesturing to one of the younger WBC women, she added, “Meagan, she’s Twittering right now.”

But she explained the reason behind the protest: “Twitter should be used to tell the punks of doomed America that God hates you!”

As a staunch advocate of the use of social media, I have to say this shows a complete misunderstanding of how Twitter works, and reveals the difference between the old and new schools of mass communication. Protesting at the Twitter offices to get the platform to be used in one way or another presupposes that Twitter is a one-way channel that controls all the messages sent through it. It’s like seeing a soda can on the ground next to a recycling bin and complaining that the bin doesn’t reach out and pick up the can.

The new model of social engagement starts with interested parties reaching out to other interested parties. The correct action to take if you want Twitter to “tell the punks of doomed America that God hates you” is to start telling them yourself via Twitter.

Of course, that’s going to be somewhat problematic, since Twitter doesn’t work by telepathy. You can spout all the hate you want (subject to Twitter’s terms of service) but if nobody’s following you, you won’t be heard. The punks of doomed America aren’t going to follow these people to receive daily reminders of how a fringe group thinks they’re damned—well, the masochistic ones might—so the message dies. That’s how it is with social: If you want to reach people, you must have something worthwhile to say.

So, after a less-than-spectacular 2009, we’ve arrived in a new year. And it’s cold. Really cold.

Maybe it’s not that bad where you are, but in New York we have it frigid and windy. I happen to love cold weather, and even I find this to be a bit much. The window I’m sitting next to as I write this is not the best insulated, so a draft is pouring off of it onto my left arm. (I prefer to think of pouring drafts in a more delicious liquid format, but I’m not here to talk about my weakness for fine adult beverages.)

I can hear you wondering what, if anything, this has to do with the business of getting and keeping customers. I’m getting to that. It’s just taking me a while because my brain is impaired by the cold; my fingers aren’t doing much better. It’s cold enough that, were I outside, I’d be looking for a shop to go into just to warm up. As it is, I’m considering leaving my drafty apartment for just such an adventure. And there’s the tie-in.

Walk-in customers and their online equivalent represent a great opportunity to earn new business, but only if the customer experience you provide is up to the challenge. Anybody can turn up the heat, but turning casual browsers into new customers requires warmth. Making people feel welcome goes a long way toward getting them to see what you have to offer, and this applies whether you serve consumers or businesses, in a shop or on a Web site.

Most businesses aim to showoff value first, with announcements about the latest sales and best brands right in customers’ faces when they walk in the door. This can backfire, because it’s very off-putting. Shoppers who know what they’ve come for aren’t interested, and casual foot traffic gets the sense that they are prey for a sales pitch. “How can I help you” is much more welcoming than “what are you looking for,” wouldn’t you agree?

For brick and mortar shops, simple touches like having hot tea or coffee available in the winter—preferably free—and cold drinks in the summer can earn a favorable impression and a closer look. Williams-Sonoma often has free mulled cider in the winter, and remembering that is nearly enough to get me to go there now. Always allow (read: encourage) staff to engage walk-ins in non-sales related conversation as long as it isn’t taking away from something they need to be doing. Things like that go a long way.

Getting beyond specifics like hot drinks and warm conversation in retail stores, the general principle of welcoming applies to any business. If you can make your customers think kindly of you, they will always have you in mind. They will think of you as more than just a supplier of products—and they will spread the word about how pleasant it is to do business with you, even when they’re not actively buying.

I was thinking today about the similarities between bad CRM practices and owning cats. I realize that telling you this and then writing about it may hurt my credibility, but (1) it’s true that I was thinking this and (2) I am really tapped for better ideas today, so here goes.

The dialogue, if you can call it that, between cats and their owners is mostly in one direction. I buy a new toy or type of food for the cats, and then try to interpret their interest—marketing. We don’t speak the same language, just as businesses often don’t think of a successful product in the same way a customer would.

Once I’ve started the marketing campaign, the next step in KRM (Kitty Relationship Management) is trying to close the deal, turning up the pressure in order to sell the cats (their names are Cookie and Dr. Harbl, in case you were wondering) on the wonders of these new rawhide mice, or frozen raw venison burgers, or whatever. Again, the success or failure of my efforts is dependent on factors I can neither predict nor understand. In time I might develop some insight to what these particular cats prefer, but I can’t necessarily communicate that information to somebody else, nor can I apply it to other cats.

Kitty customer service? Again, failure to communicate is the order of the day. I am prepared to respond to certain requests from my cats, so every time they provide input I try to interpret it in light of those expected requests: feed me, pet me, or clean the litter box. It took a while to learn that last request, mainly because my own data told me I was doing an adequate job. If I’m not doing what the cats want, they have limited means for setting me on the right track, and if they don’t lodge some kind of protest, I continue with what I’ve been doing.

Good CRM, especially the social kind, is like speaking cat language. Maybe that doesn’t sound like a ringing endorsement, but trust me—it’s huge. If you’ve ever had a cat deposit its “customer feedback” on your laundry bag, you’ll agree.

Businesses are starting to understand the value and importance of a social media approach to CRM, if the calls I’ve been taking are any indication. That’s good, but sometimes I feel that for some people, the terms we use—social media, social CRM, Enterprise 2.0 and the rest—are just words hung onto a concept, their meanings ignored.

While letting “social CRM” exist merely as shorthand for a broader concept—like Paul Greenberg’s excellent and tweetable definition, “the company’s response to the customer’s control of the conversation”—I prefer for the concept to remain grounded in the words that describe it. In this case, the best definition of social itself is from Merriam-Webster: of or relating to human society, the interaction of the individual and the group, or the welfare of human beings as members of society; tending to form cooperative and interdependent relationships with others of one’s kind.

It’s great if your company is engaging its customers and partners in conversation through its own social networking tools. It’s beyond great, it’s necessary in most cases. But there must be more. You’ve got to reach out beyond your own circle, and start exchanging ideas with new people and organizations, ones in whom you don’t already have a financial interest.

This is not to say that you should abandon any current social efforts. Just make sure you’re sticking your corporate nose into somebody else’s as well. I’m not talking about corporate espionage—that’s bad. I mean participation in timely and topical discussion groups (the Answers section of LinkedIn is an excellent example), attending Webinars, and just letting your people explore where their interest takes them.

If our hunter/gatherer ancestors hadn’t been willing to meet other bands of like-minded people, we would never have gotten beyond tribes and clans, warring with one another for access to water, hunting grounds, and abundant vegetation. (You could make a decent argument that we still haven’t gotten beyond that, but I’m feeling generous to our insane species today.) Communication with “the other” brought trade, exchange of ideas, and the peace of mind that comes from knowing what those guys in the next cave are up to.

It’s no different in modern society. Looking for new ideas and new associates to share them with is a major driver for the modern, socially-aware business. Does your desire for partnership and creativity outweigh your fear of competition? It should; competition is healthy. Social interaction means business doesn’t have to be a zero-sum game. Your competitors may glean some ideas from you that they might otherwise not have, but you will do the same. You will each innovate, raising the standard for all. You will allow your entire industry to serve the customer better.

Take the next step. Get your company onto somebody else’s social network. It’s only natural.

Businesses, you may be surprised to learn, exist to earn money. So it’s really not hard to understand why many of them are reluctant to embark on any new project—especially one that costs money to implement—before they have a solid idea of how it will affect their earnings. Beyond the company’s products/services, this has been the case with every new technology, every new management principle, and every business process. It’s one of the things that puts money in the pockets of analysts and consultants like me.

Social CRM, and social media awareness in general, is passing from the wowgottahaveit buzzword phase of its existence and entering the cost-benefit analysis phase. There are lots of discussions (or one big discussion, in a way) being had about how one measures the return on investment—ROI—of social CRM. You can see the Wordpress blogs that have touched on it here; I can’t say I’ve read them all yet, and likely never will. A guy’s gotta get out of the home office from time to time.

Forrester analyst Natalie Petouhoff (Dr. Nat to her friends and pretty much anybody else) has a report on The ROI of online customer service communities. Sometime in the near future, Ryan Zuk will be publishing an article on social media monitoring for the PRSA newsletter. I may or may not be quoted in it, depending on how the piece shapes up and what his word count ends up at. (I’m not trying to add pressure for my inclusion, Ryan, just using you as a lead-in to my point.)

If I’m in there, I may come off seeming like I don’t think ROI should be a consideration for businesses implementing social CRM. That’s not the case. It’s the foolish (and often failed) business that doesn’t consider the consequences of potential actions. What I do think is that sometimes “hard” ROI, expressed in dollars and cents, is tricky to estimate and sometimes utterly beside the point.

You can see a few cases where social CRM has made a big difference for small businesses in this New York Times article. Beautiful examples of clear, identifiable ROI—even though most of the social tools mentioned don’t cost anything. These business are reaching out directly to customers, using simple applications as a marketing engine first and a means of receiving feedback or participating in a conversation second.

I’ve developed a habit, when discussing ROI on social CRM for larger companies, of putting things in terms of fear. Next to greed, fear is the prime motivator in business. “Your customers are having conversations about you that you’re not party to,” I’ll say. “They’re also having conversations about your competitors, but some of your competitors are participating. If somebody starts a rumor about your products or your practices, your customers might perpetuate it, and your competitors aren’t going to do anything to stop it, if it’s bad. Can you afford not to listen?”

Of course it’s not all about fear. One of the best anecdotes of social CRM in action is owned by blogger, consultant, and CRM Rock Star Brent Leary. Ask him about biscuits (the American kind), and how a single tweet got him to eat at Popeye’s after a multi-year absence. More than just the $6 revenue Popeye’s got, though, is the tremendous positive word-of-mouth the restaurant chain got by making one response to one person—the right person—at the right time. Brent will be able to tell this story about how Popeye’s “gets it” for years to come—and if he doesn’t, then I will.

My advice to businesses, in brief: Study social CRM as much as you can, see what others are doing and what works best for your particular business. If you can figure out a way to make it pay, then by all means do that. But get in the game regardless. It may cost you nothing, but the rewards—monetary or otherwise—only come when you get involved.