Social media are changing the way that businesses interact with the customers on a massive level. Not only have they changed the way of organizational interaction with customers, social media and social networks have brought new customer relationship management (CRM) opportunities, if done right.

While social media may be revolutionizing how businesses are able manage customer relationships. The problem is how to implement social media initiatives successfully in CRM on an enterprise level.

According to Gartner, 60% of Fortune 1000 companies will be using social media in some fashion by 2010 as a way to manage customer relations. Gartner also predicts that by 2010 over half of companies using social media for CRM will do it incorrectly -- thus, devaluing customer relationships.

There are four steps that businesses need to pursue for successful use of social media as a CRM tool. Experts at Gartner have concluded that not only is the use of social media in CRM imperative to businesses, but that these four steps are crucial in the proper implementation of a campaign.

The Four Steps of Successful Social CRM

Defining Purpose

When beginning an initiative in social CRM or in any sense proper defining of the initiatives purpose is paramount. Specifically where social media is concerned many companies jump in with both feet before determining the waters depth. And they end up with a poorly organized social customer relationship management plan. A clearly defined purpose will give direction and a goal.

Give Up Some Control

The beauty and appeal of social media comes with the fact that each user has the ability to exercise some control over the media or application. Whether through the use of profiles or individual pages or whatever, the public wants some ownership as a reward for participation and that ownership involves some control, so give it to them.

Allow them to contribute, not just interact. By allowing your customer base to directly contribute to your social endeavors you build value beyond your own goals.

Reward Your Participants

No one likes to give something for nothing. Your social CRM plan will fail utterly if you do not reward those that participate socially. In addition, you need to understand the varying levels of participation. Some are there attempting to stake their claim on a piece of virtual land (they want to make a name for themselves and be recognized), others simply want to contribute. You can also have those who want to profit from the use of your social media in some fashion (not necessarily monetary profit, but in the form of links, contributed viral media, etc.).

A great way of offering reward to participants and allow your customer relationship management team to classify and group users is through the use of social reputation technologies. They allow users to rate, rank and vote on contributions, information, etc. and create a hierarchy of social users to manage. This can be done through a voting setup or by monitoring page views to rank a user's activity.

Ensure Skilled Staff is at the Core

Many companies may find it difficult to appoint someone in-house with the necessary skills to spearhead a social CRM initiative. Therefore it is of the utmost importance to seek out training for existing customer relations personnel or hire experts in the field to ensure that your businesses initiative is administrated properly. And while this portion of the initiative can require a large budget, without it you most likely will be wasting time and money.

What About Tools of the Trade?

Aside from these four steps, something that Gartner does not discuss is what social media tools should be used. There is a huge variety of solutions out there from large social networks like Facebook and MySpace or Ning (where you can create your own social network). Other services that can be implemented include Twitter, LinkedIn and MyBlogLog. There is also the use of social and viral media in the form of videos, widgets and podcasts.

These things should be determined during the process of defining your initiatives purpose. Consider what the goal is, work with knowledgeable professionals and determine the best set of tools for your new social media-based customer relationship management initiative.

Social media have no doubt had a massive impact on how businesses interact with customers and build relationships. According to Adam Sarner, research director at Gartner, “Social networking has changed the way a critical mass of individuals behaves, including how they act as customers and prospects. Customers, not just digital natives, can no longer be adequately described by demographic information -- the usual target for corporate CRM efforts.”

Although difficult and potentially costly, social media can help your business can be on its way to re-engaging your customer base, building new customer relationships and nurturing existing ones. By following these steps above, you can gain a better understanding of who your customers are, what their needs are and how you can meet those needs.

Gartner is set to discuss the future of CRM at Gartner Customer Relationship Management Summit, on March 3-4, 2009, in London.