Social network MySpace has replaced its traditional customer relationship management (CRM) service with a social CRM, saving £2m and increasing customer satisfaction "threefold" since last year. The social network believes this will win back MySpace's competitive advantage, providing useful lessons for businesses looking to incorporate social networking into its CRM.
MySpace had more than 42% of the social network market in 2007, surpassing newcomers such as Facebook and Twitter. According to SocialTwist, MySpace now accounts for just 15% .
"With the meteoric rise of these technologies, it's inevitable for there to be rapid declines," says Rob Bamforth, analyst at Quocirca. Because MySpace was "there sooner", it faces greater challenges in offering something unique and different. "MySpace needs to work out its target audience and pitch something that appeals to them," he says.
MySpace agrees. "MySpace looked unbeatable," says Tish Whitcraft, senior vice-president of customer experience and operations at MySpace. "However, there was one major issue that was bringing the company down - poor customer service."
To improve customer service, MySpace migrated its traditional customer service - mainly consisting of a static FAQ page - to a social CRM by RightNow Technologies over 14 days last year.
"FAQs had not been updated in years and customers struggled to find a customer service link that actually worked," says Whitcraft. "We went from the bottom. Searches in online help went up 400% through a fully-integrated look and feel of the product."
Social CRM incorporates communication channels such as social networking sites. The Rightnow CX used by MySpace is a customer experience suite, which includes a set of applications to address the web, social and contact centre experiences.
MySpace used to use a platform that required eight packages to integrate with its CRM to provide channel support and functionality. Whitcraft says it was a "major initiative" to perform upgrades and required a large investment of professional services to get it working again.
Using the Rightnow platform, MySpace has integrated everything: "97% of the users that come to our online help area resolve their issue without having to contact us," says Whitcraft.
While direct customer contact decreased, MySpace also worked to pro-actively contact some customers using a cloud monitoring tool to identify customer queries and issues raised on social networking sites.
"Not only have we surprised them because we went out and found them and their question or comment, but they have a new-found loyalty to our brand because we're showing we care," says Whitcraft.
MySpace also uses cloud monitoring to identify trending topics and potential product issues on social networking sites and provide "meaningful feedback" to the business.
By deflecting 900,000 user e-mails in the first eight months via automated e-mails, MySpace was able to make savings of $3.2m (£2m).
Rightnow's smart assistant suggests relevant answers to customers via automated e-mails. "The smart assistant deflects approximately 25% of the e-mails from being submitted, which saves us seven figures annually," she adds.
"In most customer experience circles, deflecting e-mails and calls is seen as a cost-saving exercise and as a negative thing to do. But most consumers have old-school customer care. Our users want to help themselves," says Whitcraft.
MySpace also offers video tutorials for commonly asked questions rather than a static FAQ page. Whitcraft says MySpace has the ability to produce videos very quickly.
"A majority of the online users tend to look for videos rather than text content for information. After all, videos provide a more convenient way to learn than reading tonnes of text crammed in a single page," she says. "We will be rolling out user-created video tutorials when we launch our MySpace social help platform."
MySpace plans to offer web chat for customer questions and topics later this year. But, ultimately, it is championing user self-help. "We've already found at MySpace that six out of 10 users who are sharing questions and comments about MySpace products on the social web are not contacting us directly," says Whitcraft.
"We have found that our online help, video tutorials and upcoming social help platform will provide a better solution to our users for our products. All of our products continue to be available to our users without charge, so our approach focuses on self-help, which is our user's preference."
MySpace is currently testing the use of Rightnow mobile with a view to launch next month, supporting Blackberry, iPhone and Android platforms. This will provide customer help via mobile devices.
"RightNow Technologies's new mobile product is going to be a huge win and flagship of support experience in Europe. Mobile is a huge growth area for MySpace and we've seen 600% growth year-on-year," says Whitcraft.
MySpace has learned that customers would rather enter a query into a search bar than make a phone call to a contact centre. By broadening its traditional approach to customer relationship management and incorporating web and social media channels to improve customer service, MySpace believes it can achieve a competitive advantage.
"Being able to bring all these conversations together, along with the more traditional CRM channels, will allow us to paint a very colourful, complete and meaningful picture for our business and for our users. That will be a very powerful competitive advantage," says Whitcraft.
What is social CRM?
CRM author, Paul Greenberg, gives his definition in a blog post:
"Social CRM is a philosophy and a business strategy, supported by a technology platform, business rules, processes and social characteristics, designed to engage the customer in a collaborative conversation in order to provide mutually beneficial value in a trusted and transparent business environment. It is the company's response to the customer's ownership of the conversation."
Five tips for social CRM success
Forrester anaylst Diane Clarkson believes firms need to ensure interaction between marketing, public relations, IT and customer care departments in a social customer service strategy. She recommends:
- Listen to your customers - "First thing is to listen. Listen to what your customers are talking about and where."
- Put a team together - "Put together a cross-functional team at the outset. This is where social CRM often falls down. Companies typically need marketing, customer service, technology, PR, legal/governance, and sales to play a role in a successful social CRM strategy."
- Define process - "Identify ownership and have processes in place that will facilitate collaboration."
- Set objectives - "There are many different benefits to social CRM and it is critical to have identified from the outset with the objective is. For example, you may not want a promotional posting in a customer service forum."
- Measure success - "Clearly identified objectives will determine the appropriate metrics to measure success."