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THE BOTTOM LI NE
As more businesses consider the benefits of social media, champions are increasingly
asked to prove tangible business value. In its continuing analysis of the impact of social
media on sales and marketing initiatives, Nucleus has found that companies can achieve
significant benefits by adding social capabilities to CRM deployments, including reduced
costs, increased sales, improved employee productivity, and improved brand visibility.



The buzz around social media and its place in the enterprise has increased dramatically in
light of the Facebook IPO and multiple acquisitions in social media and social networking.
And while some companies have been quick to jump on the Facebook and Twitter craze,
others have been more cautious, waiting to see what kind of ROI social integration can
actually deliver. The growing influence of social media and the ubiquity of social
networking are causing marketing and sales professionals to rethink the way they do
business, and recent vendor acquisitions have shown an upsurge of investment in social
marketing, customer sentiment monitoring, and enterprise social networking with
Microsoft buying Yammer, Salesforce.com and its acquisition of Buddy Media, and Oracles
purchases of Vitrue and Collective Intellect. With this research note, Nucleus takes a closer
look at the benefits of social CRM and details how to quantify the value it can deliver.

WHAT I S SOCI AL CRM?

In a recent survey of over 220 CRM decision makers, Nucleus found that adding social
capabilities to CRM drives an average increase in sales staff productivity of 11.8 percent
(Nucleus Research m13 - Market Focus Report - Mobile and Social CRM, March 2012).
However, the same survey also found that 16 percent of respondents didnt know what
social CRM was, and only 8 percent considered themselves best in class for their use and
evaluation of social CRM technologies.

Adding social capabilities to CRM applications drives an 11.8 percent increase in sales staff
productivity.

Nucleus has found that social CRM draws on one or more key concepts of social
networking applications:
RESEARCH NOTE
THE ROI OF SOCIAL CRM
August 2012
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Nucleus Research is the leading provider of value-focused technology research and advice.
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The use of internal social networking platforms like NewsGator or Yammer to facilitate
the exchange of knowledge and employee collaboration
Activity feeds that allow employees to push information to other CRM users, such as
Chatter
The integration of social networks and communities like LinkedIn or Facebook with
existing CRM applications.

The integration of social media with CRM applications enables organizations to encourage
collaboration within the business while also strengthening marketing outreach. Nucleus
found that social collaboration platforms like Salesforce Chatter provide employees with
greater visibility into the business and encourage increased collaboration from the
departmental to regional to global level (Nucleus Research l74 - The return on investment
from Chatter, April 2012). Marketing automation and customer sentiment tracking
applications, such as MicroStrategys new MicroStrategy Wisdom Professional, enable
users to analyze consumer data contained in Facebook profiles and improve the
effectiveness of customer outreach.

THE BENEFI TS OF SOCI AL CRM

In analyzing CRM deployments that included social capabilities, Nucleus has found that
benefits of social CRM include improved company visibility and communication, reduced
marketing costs, and increased productivity of both sales and marketing employees.

PRODUCTIVITY
Improved sales and marketing staff productivity is a significant benefit Nucleus has found
from using social CRM. Social collaboration applications improve overall employee
productivity by providing push mechanisms that ensure employees stay informed and
engaged and spend less time searching for information. In an early look at Salesforce.com
Chatter in July 2011, Nucleus found Chatter drove a 12.5 increase in productivity (Nucleus
Research l74 - The return on investment from Chatter, July 2011) the equivalent of an
hour a day, assuming a 40-hour work week.

Social media can also be integrated with marketing platforms to automatically populate
request for information forms, create highly targeted marketing campaigns, and drive
customers to new products. Nucleus found marketing automation drives a 14.5 percent
increase in sales productivity (Nucleus Research m22 - Marketing drives CRM ROI, April
2012). IT can also benefit from such social media capabilities. For example, one Salesforce
customer reduced network downtime by creating a custom Chatter feed that integrated
error messages from the wireless network to automatically notify IT when there was a
problem.



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VISIBILITY AND COMMUNICATION
By providing employees with a single platform for sharing information, companies can
improve customer engagement and the development of relevant content across the
enterprise. Social CRM applications facilitate visibility and collaboration so users can
better identify and replicate best practices while also making employees more aware of
and aligned with company goals. For global organizations, many applications offer
localized versions that enable global users to contribute in their preferred language.

REDUCED COSTS
Nucleus has found that marketing automation can drive a 12.2 percent reduction in
overhead by reducing the cost and time to develop and launch initiatives, generating
more leads at a lower cost per lead, and delivering more relevant information to
customers. By integrating public information available on customers Facebook pages and
enhancing it with third-party data, marketers can more accurately target potential
customers and make better use of limited marketing resources while applications, such as
those offered by Buddy Media, allow users to create, manage, and measure the
effectiveness of their social marketing campaigns.

CUSTOMER EXAMPLES

KIMBERLY-CLARK ACHIEVES 108 PERCENT ROI WITH SALESFORCE.COM
In 2010, global health and wellness product provider, Kimberly-Clark, deployed
Salesforce.com to support a common CRM strategy across its Health Care and K-C
Professional global operations. Benefits of the project included:
Increased visibility and collaboration
3 percent increase in sales
Improved customer retention
Increased manager and general employee productivity.

The company currently has approximately 1900 Salesforce.com users working in more
than 10 languages and 27 currencies across Asia-Pacific, Europe, North America, and Latin
America with approximately 3000 Chatter users (Nucleus Research l117 - Salesforce ROI
case study - Kimberly Clark, December 2011).

CUSTOMER EFFECTIVE MAINTAINS GROWTH WITH INSIDEVIEW AND DYNAMICS
Microsoft Gold Certified Partner, Customer Effective, integrated InsideView with Dynamics
to enhance existing contact information with data from social networks and other news
sources. The company has also used integration with blogs, Twitter, Facebook, LinkedIn,
and Web analytics to gain a better understanding of prospects activities and level of
engagement before they are ever contacted by a sales person. Benefits of the project
included:
15 percent average increase in sales productivity



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2012 Nucleus Research, Inc. Reproduction in whole or part without written permission is prohibited.
Nucleus Research is the leading provider of value-focused technology research and advice.
NucleusResearch.com
August 2012 Document M100
Improved business productivity
The ability to maintain the companys growth in a down economy.

YAHOO IMPROVES PRODUCTIVITY, REDUCES STAFF WITH APPIRIO
In early 2010, Yahoo sales management recognized that it needed a more globally-
coordinated and accessible content repository for sales to be more competitive and
effective in selling Yahoo business services. With Salesforce.coms content management
capabilities and Chatter functionality, moving to one global sales content sharing and
collaboration platform enabled Yahoo to increase collaboration and sales productivity
while reducing IT costs. Key benefits included:
$1.5 million in tax write offs for hardware and software investments
Reduced annual software license costs
Increased sales productivity
Reduction of at least 20 administrative and sales support staff.

Today, the application has 4000 active users worldwide (Nucleus Research l116 - Appirio
benefit case study - Yahoo, October 2011).

CONCLUSI ON

From monitoring and analyzing customer sentiment, to the gamification of brand
interaction, companies are taking advantage of the benefits of social media to increase
customer engagement, improve brand visibility, and reduce costs. And as consumers have
become used to engaging with their favorite brands online by liking new products or
becoming fans on Facebook, companies have become increasing aware of their brands
social media presence. Some of the largest CRM vendors have recently made significant
investments in their social CRM offerings with both acquisitions and innovations, proving
that, while social CRM is still an emerging market, customers and vendors alike see social
CRM as a genuine opportunity for business growth.