The Knowledge Exchange / Customer Intelligence / In sales, social media’s indirect benefits matter most

In sales, social media’s indirect benefits matter most

Raj Agnihotri, PhD

There’s no better place to get a sense of the potential downside of social media for business than in B2B sales environments.

Sales managers are under a lot of pressure to get their reps to exploit interactive online technologies to the max, but that’s a lot easier said than done. Simply telling sales professionals to start blogging or to jump on LinkedIn or Facebook has been shown to alienate customers, sap employee motivation, and undermine sales productivity. To avoid those pitfalls, managers need to spend time and money providing training, direction, encouragement, and feedback in a field that is changing constantly. But according to Brian Fetherstonhaugh, CEO of OgilvyOne Worldwide, only 9% of salespeople responding to a recent global survey reported any such efforts. Even if companies do make these investments, and the effort results in reps’ being better able to negotiate social media’s chaotic terrain, there still might not be much to show in terms of higher sales.

So it’s no wonder that there’s a lot of uncertainty about and even fear of social media in B2B sales departments. Nevertheless, my research with Prabakar Kothandaraman and Rajiv Kashyap of William Paterson University and Ramendra Singh of IIM Calcutta shows that with the right managerial support, sales departments can use social media to create significant value for customers. The key is to focus not on direct benefits such as profits or sales volume but on the indirect benefits — better market knowledge and increased customer engagement.

There’s been a lot of grumbling in sales departments about social media, for understandable reasons: It challenges reps’ familiar role as information brokers and threatens to interrupt traditional, tried-and-true approaches to communicating with customers, such as phone calls and in-person meetings, to some extent replacing them with forms of communication that can be disconcertingly transparent.

For example, customers visiting SAP’s Community Network talk openly about thorny issues ranging from product complexities to technical errors, and prospective customers can read every word. That kind of forum can be unsettling for sales reps who came of age before social media.

But social media isn’t going away, and that’s a good thing, because its upside is impressive. It can help reps build trust with customers and prospects; it can foster the interactivity that leads to deep customer engagement; it allows reps to hear customers’ praise and gripes and to scout competitors’ strengths and weaknesses; it gives reps a platform for educating customers, showcasing testimonials, and countering competitors’ claims; it helps salespeople generate leads; and it facilitates the capture of important data about customers, ranging from their opinions to their birthdays.

A basic social media strategy should involve helping salespeople specify their objectives, engage customers, and monitor competitors; in addition, companies should assess reps’ performance. Beyond that, social media can be used in the service of two very different approaches to sales: relational and transactional. The relational approach is exemplified by IBM’s social media strategy, which emphasizes individual interactions as a way of building relationships and drawing customers in. Xerox also maintains numerous blogs that connect salespeople, prospects, customers, and product specialists.

The transactional approach was exemplified by Groupon’s venture into the B2B area. It worked with a consulting firm, Ajilitee, that was willing to offer a discount for a data-analysis service to attendees of a cloud computing conference.

The approaches aren’t mutually exclusive — a company can incorporate both into its overall strategy. But whatever the overarching strategy, there are certain capabilities that reps need to learn. Here are a few:

Generating content. Whether it’s on blogs or Twitter, salespeople need to learn to position themselves as experts and provide valuable information for customers and prospects. That might mean offering suggestions and solutions on a continuous basis, or it might mean conducting live Q&A sessions on Facebook with customers. Generating useful information not only makes the company top of mind and educates customers, but it also sends a signal that the rep really cares about the buyer’s bottom-line goals.

Monitoring. Salespeople need to learn where users are congregating on the web and monitor their discussions in order to gain critically important information on what customers think about the company and its products and competitors. But reps need to be careful about intruding in these forums. “You have to earn the right to ask for leads,” SAP senior VP Mark Yolton says in a “Social Media Best Practice” seminar. At the same time, reps can use platforms such as Twitter to follow customers and learn what they’re thinking and what they’re interested in — information that can be useful to reps in providing a personal touch.

Developing leads
. There are many ways to do this via social media. For example, a salesperson for an OEM, having learned through monitoring LinkedIn that a civil engineering firm has secured a large account, might send a congratulatory tweet to the firm and initiate a discussion of tools that the firm might find interesting. A salesperson can also ask for a LinkedIn recommendation from an existing client from the same industry to enhance credibility.

Salespeople obviously aren’t born knowing how to do these things, so managers need to provide support in the form of training and in the hiring of technical staff. A seminar in writing for social media can be an effective way to help reps overcome any nerves about forms of online writing, such as blogging. Managers also need to shift resources in order to adjust to the new demands on salespeople’s time.

Companies, moreover, should be willing to shift a significant piece of the marketing budget to social media and to the creation of positions with specialized responsibilities, such as virtual community manager, social media strategist, social network moderator, and social marketing specialist.

When it comes to metrics, companies should develop measures that reflect strategic priorities and the importance of social media’s indirect benefits — for example, customer engagement rate (the number of clickthroughs or the volume of posts or comments on a blog) and digital audience growth (the number of Facebook fans, Twitter followers, or LinkedIn connections). These results should be monitored on a weekly or monthly basis.

One caution: Don’t be too reliant on metrics. Many of the benefits of social media, such as customer engagement, can’t be easily quantified. But that doesn’t make them any less important.

For more articles like this one, download the Harvard Business Review report: Putting Social Media to Work.

*Reprinted with permission from Harvard Business Review.

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