Defeating the Dark Side of Social Networking

For all of its blessings, social media Web sites are vexing lots of companies. The instantaneous sharing of information and opinions about products on Twitter, blogs, and other sites is compelling companies to try to influence these conversations through technology and new ways of thinking.

Businesses don't really need to worry any longer about losing control of what consumers are saying about them on the Web; that control is pretty much gone. Many companies are being victimized by social media rather than capitalizing on it because they're too slow and ill-equipped to react to negative comments that can damage their brands. For example, Johnson & Johnson (JNJ) in 2008 had to apologize for an online ad for its painkiller Motrin after a backlash of comments from mothers in the blogosphere who objected to the advertisement's tone.

To be sure, companies can generate sales leads and gain market share by promoting themselves through tweets and blogs. Dell's (DELL) IdeaStorm site, which lets consumers suggest enhancements and fixes to products, is one prominent example. Nearly half of Internet users say they value information from other consumers more than information supplied by companies, according to Forrester Research (FORR).

Companies Slow to Respond

For the most part, though, companies are too slow to respond to the online flood of information being published about them by consumers. Since it's easier than ever for customers to tell each other when service is bad, responding quickly is critical. Repeat buying is usually driven by positive customer service, not price, Accenture's (ACN) research shows.

But many organizations can take weeks or months to react to negative conversations, leaving far too much time for damage to set in. Even worse, some companies don't respond at all.

Let's look at some examples of vendors that have taken the initiative in sorting, analyzing, and responding to the data pouring in through social media. These companies are taking steps to combine the sort of free-form information flowing in from blogs, e-mails, and tweets with data stored in traditional database software, in order to make judgments about where customers' concerns lie.

Software maker Attivio is developing the ability to analyze both those kinds of data to help companies detect the social media buzz about them. Then its software helps companies feed that information into their customer management systems to react to those findings. Clarabridge, a maker of "text mining" software, makes tools that combine linguistic rules with machine learning techniques to help companies categorize customer comments and sentiments so they can react to them.

When a company launches a product and wants to know where customers are finding fault, it needs to combine the conversations occurring in social media with the conversations occurring in its call centers and stores. Accenture's research has found that consumers buying pricey tech goods like mobile phones and TVs tend to perform lots of research online before setting foot in a store. Retailers who want their employees to know more than their customers might provide their staff with a daily or weekly summary of the latest product information synthesized from Internet buzz and call-center conversations.

Six Recommendations

To try to respond to conversations about their brands in social media, companies would do well to consider six sets of actions:

Develop a "social customer management" strategy that includes technical and business process components designed to engage customers in conversations on the Web.

Automate as much interaction with customers as possible, so call-center workers can put the best approaches to work repeatedly. Clarabridge, for example, makes automation software to help with this.

Reduce the time it takes to respond to Web postings from weeks to hours, or even minutes. Attivio's real-time analytical software can help companies quantify and react to customer opinions, for example.

Connect marketers with product development staff to build a bridge from the conversations happening on the Web to the goods and services your company produces. Dell's IdeaStorm is a great example.

Balance your resources between fielding customer phone calls and responding to what's happening on the Web. Of these six actions that Accenture recommends, rebalancing these resources is perhaps the hardest, especially since customer management software may not easily consume information coming in through the Web.

Prioritize which customers demand the most immediate attention, and come up with a plan to ensure a timely response based on how valuable they are.

Every customer who contacts a company through any communication channel should be handled in some capacity. However, those that get in touch, or just gripe, through social media may need some extra care. In addition, services from vendors including Rapleaf and Flowtown let companies append data gathered from social media to computerized records of customers and prospects. The Lending Club, a peer-to-peer lender, uses this kind of data for marketing and to help uncover fraudulent loan applications.

Would you ignore a customer who called you and complained by telephone? Probably not. Then why ignore customers complaining about your firm through social media that's instantly accessible to others? Companies shouldn't depend on customers to write positive things about them.