Social Media is a MUST for an organisation
Large, global brands are tapping customer sentiment from the free-flowing social media channels and smaller firms could take a leaf from their book, according to a fast-rising social CRM (customer relationship management) firm.
Rob Tarkoff, CEO and president of Lithium Technologies, says firms have experimented and dabbled with broadcasting their messages on platforms like Twitter and Facebook over the years. Often, this has been met with limited success, he says.
Instead, the opportunity on social media networks is not as an online loudspeaker, but to provide firms a way of reading customer sentiment rather than coughing up money, sometimes in the millions, tracking and measuring through traditional CRM software.
The social metrics firm tracks customer sentiment across online communities such as forums, blogs, and live chats, in order to present the information to clients.
Mr Tarkoff says big brands have been quickly catching onto this trend in recent years, because of the amount of customer feedback that is expressed across social media, instead of through phone calls directly to the companies.
“Companies are changing (their customer outreach strategies) because they’re losing mindshare with audiences,” he says. But the most successful social strategies involve getting a brand’s genuine fans to be their ambassadors online, he notes.
The company runs a community chat for Sephora, a cosmetics retailer in the US. “Super fans can solve community problems too” by answering and helping out other customers, he says.
The thought of leaving customer interactions up to non-employees, however, is rattling for many enterprises. Mr Tarkoff acknowledges this, but says: “It’s not the Wild West. There’s a lot that brands can do to be part of the conversation.”
The fact is, for a lot of companies, pretending that issues don’t exist is potentially worse for the brand, he adds. “A lot of companies tie their online social activities into their CRM systems. So if the community cannot answer, they can have their agents answer or escalate it up.”
Large firms are placing their bets on social media systems. Hewlett-Packard, another of Lithium’s customers, runs 20 per cent of its customer support operations off the vendor’s systems, he says.
While Lithium has a typically large-enterprise base including the likes of Best Buy, Sony, and AT&T, the firm is surprisingly diminutive against its customers’ profiles.
The California-headquartered firm was founded in 2001. It managed to raise a first round of US$9 million in 2007. That was followed by a US$12 million round in 2008 and US$18 million in 2009.
In January this year, it announced its biggest round yet, a cool US$53.4 million. This allowed it to start expanding more aggressively overseas.
Last month, the firm opened its regional headquarters in Singapore, together with a Sydney office for the Australia and New Zealand markets. It already counts Indosat, Optus, Telstra, and Vodafone Australia as customers in the region.
Mr Tarkoff says the firm had interactions with Asian customers – it ran a community for Ford Asia – but never really had a physical hub in the region. It’s starting out small here, though, relocating three executives to its Singapore region.
It also picked up former HP vice-president of communications and media sales for Apac, Lloyd Oki, to run Asia-Pacific sales for Lithium based in Singapore. It plans to maintain a staff of between 10 and 20 in Singapore by next year, he says.
Mr Tarkoff himself is relatively new to the company, having been with it for just under a year. He took over from Lithium’s co-founder, Lyle Fong, coming over from Adobe Systems, where he was senior vice-president and general manager of its digital enterprise solutions unit.
He says the firms in Asia tend to be of smaller size than the global MNCs coming out of North America, but they are growing aggressively and have ambitious strategies.
Lithium joins a crop of start-ups selling social media tracking services that have been blazing a path through the industry in recent years.
Salesforce.com bought Buddy Media for US$689 million and Oracle swept up three social media monitoring start-ups – Collective Intellect, Vitrue, and just this month, a firm called Involver. Vitrue came at a price tag of US$300 million.
Homegrown start-up, Brandtology, was sold last year to Media Monitors for a reported sum of between $12 million and $15 million.
Mr Tarkoff says the competition in the market doesn’t scare him. “You’d be stupid not to want to compete. It’s a great market with huge opportunity.”
He’s confident that the industry will be able to keep winning enterprise customers, by showing them leads generated on their social media efforts. “You can quantify how much they generated in cost savings by having a social media strategy in place,” he insists. “Still, social media is not a substitute for companies without a true business strategy,” he adds.
Lithium offers its tool as a Web service, rather than the traditional CRM software that tends to sit on customers’ hardware on their premises.
Mr Tarkoff says that the company hopes this will make it easier for SMEs in Singapore to take it up on its offer. It has also co-located its servers for the region in Equinix’s data centre in Singapore, adding to its North American and European servers. – AsiaOne