Don Marti

Sat 05 Jun 2010 12:00:00 AM PDT

SCO (not that SCO)

A couple of years ago, I noticed a case of extra-good customer service for a customer with lots of Twitter followers, and predicted that in the future, if you have lots of "Whuffie," you get good customer service, and if you don't, you don't.

Well, it's the future. Rob Preston at InformationWeek: "A telco in the Middle East is using IBM analytics to identify the alpha individual in its customers' calling circles—those people who'd be most likely to take other customers with them should they switch carriers—so that it can cater to those individuals."

This makes all kinds of sense, as I pointed out back in 2008. Word of mouth is great marketing, but the kind of service that gets you good word of mouth is expensive. So use Information Technology to walk the social graph and find out where to invest your best service and offers.

Every trend needs a three-letter acronym, so I'm proclaiming SCO, excuse me, #sco. Social Customer Optimization. Not going to be a TLA collision with anything important unless you're a Groklaw reader, so I'm not going to worry about it. Anyway, that means I can do a "Top Ten Myths of Social Customer Optimization" presentation for the next fancy-pants conference I can get invited to speak at. (Fresh-squeezed orange juice in the speaker lounge, please.)

Here's an example of a myth: "SCO is just a strategy of giving better service to heavy users of social networking services." Wrong. That's a myth. SCO doesn't just measure how much your customers chatter, it uses really hard math to assign mathematical-looking numbers, I mean key metrics, to customers. Then it turns those numbers into action—and measurable ROI— by, for example, partitioning the customer contact resolution tree. SNIQ is good for a couple of myths all on its own, so it's totally worth it to hire a SCO consulting firm before you invest heavily in a SNIQ engine for your CRM system.

Just think about it—every customer service cost-savings measure that you decided not to adopt because of the risk of bad word of mouth? Go ahead and do them all for 80% of customers, and devote a fraction of the savings to buttering up the top quintile. You get better word of mouth with less total investment in customer service. It's a win-win. A win anyway.