CHIPOTLE AND ITS SOCIAL CRM STRATEGY

Chipotle  is one of the fastest-growing restaurant companies in the United States. 

With 1,300+ locations, and a clear social customer service strategy, Chipotle needed a scalable solution to provide business insights, keep pace with its growth, and expand to address social media over time.

You might be asking yourself, how is Chipotle achieving its Social CRM strategy?

They are using a Social CRM tool called Service Cloud by Sales Force.

This tool was ranked # 1 in 2012 Gartner Magic Quadrant Report for Customer Service Contact Centers:

2012 Gartner Magic Quadrant Report for Customer Service Contact Centers

So how does Chipotle leverage the Sales Force tool to achieve the customer contact and integration they look for?

• By using the multi-channel contact center provided by Sales force, Chipotle maintains a record of all customer service inquires. In this way, agents and administrators have in one central location SLA´s and visibility over customer’s needs.

• Service cloud has an Agent Console that allows to integrate back-office systems into the console to give agents one screen for the entire service process.  With this functionality, Chipotle has integrated its back office systems for reporting.

•   Chipotle has a new team that is entirely devoted to listening to conversations about its brand and building even closer connections to customers. They are using the Social Support feature that allows to listen to customers in over 200M social media channels, filter actionable social posts, and respond to customers in the channel of their choice. As of today, Chipotle has more than 2 Million likes in Facebook with a 95.28 response rate.

• Chipotle identify trends as they develop and like to find problems that may be general of several of their stores (quality of a supplier for example). They are able to do this with the Analytics and Reports feature, where they can see in real time reports and dashboards with a few mouse clicks and no calls for IT support.

Despite what it may seem, Chipotle’s social CRM approach is not only the typical close contact and incisive relation strategy that most enterprises explore to ensure certain communication and customer relations. Considering it is a higher scale/gourmet fast food chain restaurant, its products are more customized to their consumer’s requirements; therefore this conversation becomes inevitable, especially considering that food trends are variable.

The most important reason for Chipotle to stress such is the fact that their customers are part of the selection of the ingredients that go in their food, rather than just choosing a specific meal.  So, in a substantial measure the outcome of their products depend on the customers, on how informed they are about their choices, and about how informed chipotle is about their customer’s preferences.

In conclusion, social CRM is very relevant in most businesses, in some cases it is necessary due to the fact that not only your target is a sensitive massive amount of people but also that their response directly affects the product quality.

Knowing your birthday is not enough...

What do companies need to do to become market leaders today?

The difference between regular CRM and social CRM is the ease of accessibility and the ability to reach out and touch your customers in a way that makes them feel special and unique. While traditional CRM requires active efforts on the side of companies and active participation on the side of the customers, social CRM is just a mouse click away. Social CRM, using web 2.0 is reaching out to us as consumers from every social network we use and from every blog post we read. This enables companies to access our opinion about their products much faster than ever. Social CRM is so fast it can even be used by companies in the design phase of new products and not just as feedback on existing products; basically giving companies a perfect sounding board in the form of the same people it will sell the products when they hit the markets.

The ubiquitousness of the internet has made social CRM a strategic tool which is no longer a luxury, but a necessity, in fact missing out on social CRM will lead to destruction of value and loss of market leadership for the companies who choose not to use it.

The perfect example is the company “Zalando” which in 2008 revolutionized the online clothes retail market by changing the industry business model. It chose to focus heavily on social CRM and reach out to its end users without any intermediaries, thus creating a strong sense of belonging in its customers. Within 3 years they became the market leaders in Germany, overtaking traditional competitors, using a superior business model which empowered the consumers. Zalando took the market leadership because its competitors were not fast enough to react to the changes in the market. In a mass consumption market, with current technology leading to very low costs, the best way to differentiate is to make customers think of you when they think of the product – the easiest way to do this is with social CRM. If the existing market leaders in other industries do not learn this lesson quickly, they might lose their leadership as well to young and energetic companies who will put the customer in the center.

With the ease of access to information, consumers want to feel special, and not just as a line of code in the company’s database. Increasing computational power and speed led companies to segment more and more data about customers, trying to get into their heads by quantifying everything about them, when in fact customers crave a human touch from the companies they love. They do not want the customer relations representative to wish them a happy birthday when the time comes because the representative has the information; they want actual human touch when interacting with the company. 

The companies that will act on this insight fastest will be the market leaders in this brave new world.

What is CRM?

CRM, or customer relationship management is basically listening to your clients and incorporating their input into product design and management. CRM, in its basic form only means incorporating customer feedback and sometimes not even acknowledge the customer’s contribution.

Social CRM, on the other hand, means having a dialogue with your customers in a rapid response manner linking consumer social and lifestyle data with their relationship with your company by gathering information from different platforms such as facebook, twitter, blogs, youtube, etc. Social CRM allows companies to react quickly to changing customer tastes and requests.

Social CRM enables a company to proactively involve customers in the process of validating new products and innovating existing ones. A company creates a fan page for your company or product in a social media. Customers who like your brand and products will sign up as fans, creating a venue for communication, marketing and networking. A company can follow conversations about its products for real-time market data and feedback, respond very quickly to negative feedback to maintain, regain or rebuild customer confidence.On the other hand, a customer can easily tell a company -- and everyone else -- about their experiences with the products, whether those experiences are good or bad, and ideas for future products or tweaks to current ones.

The following images from The “Brand Builder” blog  describe the differences of traditional CRM and social CRM

The concept of social CRM is a new one but it has actually been around for quite some time in different forms. While not related to social networks, the next example shows how integrating the responses of a large company to customer dissatisfaction. In 1985 the Coca-Cola Company changed the taste of its main product – Coca-Cola. It has been done without validating customer need for a new product, instead the company just decided that it knew better what the customers wanted the customers themselves. What happened was that after several months of receiving bad feedback from customers Coca-Cola finally admitted that the new product was actually not an improvement compared to the old one, therefore the company switched back to the old recipe. After losing market share and public image the company finally admitted that it should have listened to its customers before just deciding it knows best for them. Coca-Cola, even with it being a large international company – did not utilize the power of CRM which was already known in 1985. If it would have had access to a CRM platform which would enable it to receive feedback from clients in a matter of hours and not weeks, maybe the disaster could have been avoided. On the other hand, a quicker version of CRM could have helped the consumers avoid the pain of getting a product they didn’t want instead of the product they loved. Enter Social CRM.

The technological enabler of Social CRM is the social media derived from web 2.0. Without the rapid two way communications of social media we could not have had Social CRM. Social CRM could be described as a process of gathering information from users of social networks, forums and blogs by companies, deciding how to react to the information gathered (by an automated response or by a response formulated by an actual human being) and responding to the input customers provided. If needed, the company can also change its business practices according to customer opinion.

The world has seen huge technological advancement in the last decades, and the field of CRM has seen its fair share of the information revolution. The corporate world has moved from CRM to Social CRM, incorporating more and more of its clients and listening more and more to what they have to say. We believe that it is fair to say that the world has changed and that the corporations which will be able to adapt better than others will survive and flourish with the aid of Social CRM.

As technology is progressing new tools and applications have been emerging and are enabling companies to develop Social CRM strategies. As an example of the variaety of technologies that can support a Social CRM strategy, “Harish Kotadia” in his Blog : “5 Key Tech Trends Driving Social CRM” mentions 5 top technologies that are helping Social CRM to evolve: Cloud Computing/SaaS CRM, Service Oriented Architecture (SOA), Real Time “In Process” Analytics, Smart Phones/Tablet PCs and Enterprise Application/Data Mashups.





information about Coca-Cola switching to the new taste was obtained from:http://en.wikipedia.org/wiki/New_Coke
http://www.nbcnews.com/id/7209828/#.UTd0EhwUua8