I was talking with a friend who works for an unnamed big enterprise software company, here’s how the conversation went:
ME: Hey, so what new stuff are you guys working on?
HIM: Not a lot, so-and-so wants to build a social CRM product.
ME: Really? I’ve been spending a lot of time in that market, it’s really interesting.
HIM: Yeah it is, so-and-so wants to put something like Chatter on our on demand CRM product.
ME: Pause
ME: So you guys realize that bolting on a social feature is not what makes CRM truly social?
HIM: Pause
HIM: Yeah, but it’s all that so-and-so can talk about.
There’s a huge difference between CRM and Social CRM and being one doesn’t mean you can be the other. There is a legitimate ongoing debate about the nature of social CRM itself, whether it’s a product or a strategy, but for the sake of argument let’s just say it’s a product which dramatically transforms the manner in which you engage with your market and the capabilities are far afield from what traditional CRM products are capable of doing, however (and it’s a big HOWEVER) social CRM does not replace traditional CRM products at all but rather extends and augments them while at the same time building out a distinct product footprint on their own.
I really like Chatter because it is a social layer anchored in the data model that Salesforce.com has delivered, which by that I mean they have built the Chatter feature set on top of the data objects rather than just building a chat product that they offer as a new feature. It makes a ton of sense and should deliver far more value than just trying to copy Yammer.
However, as much as I like Chatter I recognize that this is a social feature and it is not social CRM… they are two completely separate things. Big enterprise software companies don’t have the skillset for building out community based social CRM offerings, which is why they will acquire their way into the market, and this is a good thing because the social CRM market is far too crowded with undifferentiated companies and products which don’t have the capacity to sustain themselves over the long haul.
The consolidation has already begun and by this time next year we will have seen the bulk of the social media monitoring and brand reputation analytics and ideation on R&D and product/project management acquired by larger companies.

[…] Chatter is Not Social CRMEnterprise Irregulars (blog)HIM: Yeah it is, so-and-so wants to put something like Chatter on our on demand CRM product. ME: So you guys realize that bolting on a social feature is not … […]
Jeff – who do you consider to be the leading social CRM providers?
I really think its a matter of using Chatter correctly in order to reap its benefit. I think it is purposeful for larger organizations that can use the social tool to collaborate with co-workers and work on business deals, but for those smaller companies, I question whether its simply another distraction. I recently wrote a blog about Chatter and the many questions that it raises, you should check it out and let me know your thoughts.
http://www.luxorcrm.com/blog/index.aspx
You make a good point about Chatter being a feature set and not Social CRM – Social CRM IS a strategy… however there may be some technologies that can help organizations with the execution of their strategy… However your comment – “by this time next year we will have seen the bulk of the social media monitoring and brand reputation analytics and ideation on R&D and product/project management acquired by larger companies” sounds like people have been saying about CRM since the 80s… Yes there will be some consolidation but for every company bought, 2-3 new ones will come onto the market. The Social CRM technology marketplace is a free-for-all right now and I don’t expect that it will end any time soon!
Hi Jim,
Point in fact, the CRM market did consolidate dramatically and the bulk of companies created in the first and second wave did get acquired.
Specifically on social CRM, let’s take one segment as an example, social media monitoring and brand reputation analytics. There are 145 distinct products or services in this space, it’s hard to imagine any other scenario than broad based consolidation.
You are right in saying that Chatter has the ability to dramatically transform customer relations practices. What’s interesting is that a lot of that will be behind the scenes, so the customer might not see what’s going on but will benefit from an improved service. As a user of the app ourselves, we see distinct business benefits. It has reduced e-mail volumes, especially the long and fragmented message chains in which it’s sometimes difficult to discern who started a conversation, who is involved in it and what actions need to be taken. It makes it easier to see and respond to things which means you can be more proactive in dealing with issues as they arise because you see them so much earlier.
We have built Chatter collaboration into our accounting app and we see great benefits for innovative customers, including more frequent and effective collaboration around sales opportunities, customer accounts and service issues in order to achieve best pricing and payment structures for big deals or avoid costly payment delays and disputes.
145 distinct products? Is there a list or some comparisons done somewhere? If a client is shopping around – how does one evaluate these?
This is want I think about Salesforce.Com Chatter:
“Cool. Fun. Easy. Useful. Flexible. Cumbersome. Collaborative. Accessible. Straightforward. Convenient.Revolutionary.”
Please vote for my ideas for Chatter in the Salesforce CRM Community!:
– http://sites.force.com/ideaexchange/ideaView?id=08730000000IOwQAAW
– http://sites.force.com/ideaexchange/ideaView?id=08730000000IKeNAAW
Social CRM is definitely a new concept for quite a few companies. It takes patience and creativity to really achieve success. It’s not something that is going to happen overnight.
My partner and i undoubtedly need to think a lot more in that area and find out what i can do concerning this.