How Much Does Social Media Matter?

My previous three posts identified companies that were susceptible to backlash on Facebook, Twitter, and 3rd party ratings sites. Since we’re on the topic of social media, I thought I’d share my view on the role of social media in customer experience efforts…

In the recent Temkin Group report, How Consumers Give Feedback, we found that not many consumers used social media to discuss their very good or very bad experiences. In the report Customer Experience Accelerates In 2011, we found that only 31% of  large companies think they’re doing a good job with social media and 79% expect to increase their focus on it this year.

Is this a complete mismatch of priorities?

My take: In some companies, social media is definitely over-hyped. But in others, it probably doesn’t get enough attention. As often is the case, the insight is in the details. Here are my observations:

• First of all, I am not looking at any of the pure marketing use-cases for social media.
• Most companies still don’t understand social media; which leads them to think that they are way behind others. This is especially true since only the extreme cases about what companies are doing show up the media.
• Since many companies aren’t doing too much yet in social media, the increase in focus in 2011 may not mean that it is displacing a lot of other activities in the company (data-oriented folks would call it a large increase on a small base).
• For most companies, there’s a goldmine of insight that has yet to be tapped from direct feedback from customers. Although only 34% of consumers told companies about very bad experience and 21% told them about very good ones, this is still a higher rate than feedback via any social media channel.
• The use of social media is still rising, so it will continue to grow in importance.
• The use of social media varies widely by consumer segment and activity. So companies need to understand their customers to figure out how important social media is to their business.

So here are a couple of my direct answers:

• Should companies be looking at social media? Absolutely.
• Is social media the most critical improvement area for customer experience? Absolutely not.

Since many companies are being aggressive with their social media efforts, I wanted to share some advice from an article that I wrote for 1to1 Media called Customer Experience Common Sense: From 1 to 6. It’s about keeping your perspective:

1. Don’t ignore existing customer conversations. While it’s exciting to think about social media, you probably already have a goldmine of untapped customer conversations in your contact center. Don’t get distracted from mining insights from existing calls, emails, and chats.
2. Listen first, long before you start responding. Once you start listening to social media, you’re bound to hear some things that aren’t flattering. Don’t start getting involved in those conversations until you understand what you’re really hearing and who’s saying it.
3. Don’t overreact to Dave’s Guitar. In July 2009, Dave Carroll posted a video on YouTube about how he and his guitar were mistreated by United Airlines. It’s been a big hit; with more than 10 million downloads. The reality is that even great companies periodically deliver bad experiences. So you can’t plan a strategy around one poorly treated customer who happens to be a talented musician and filmmaker.
4. Get brand promoters to speak for you. The best use of social media is getting adoring customers to sing your praise and defend your brand when others attack it. So find ways to create, identify, and motivate promoters to more actively engage wherever possible.
5. Don’t lose sight of who you are. The best social media efforts support a well-defined brand strategy. So make sure you have a clear understanding of your brand promises and your target customer segments before diving too deeply into social media.

The bottom line: Social media is a long-term trend, not a short-term panacea