Messenger - the next evolution of CRM?

In this post we'll evaluate Facebook Business Messanger's potential to evolve CRM.

Customer Relationship Management (CRM) increases customer value incrementally through ongoing automated, target messaging. It's ability to grow loyalty, upsell and cross sell makes it an essential component to any modern business. But as sophisticated as CRM has become over the last 20 years, it's far from perfect. And the next evolution in CRM could well be coming from the leader in online identity, Facebook.

The newly launched Facebook Business Messenger has the potential to remove much friction from existing CRM channels and, in doing so, unlock new value for businesses.

Facebook created the Messanger mobile app in 2011 to unbundle the messaging user experience from the newsfeed. Last year Facebook removed the ability to message from the main app altogether and forced users to download both apps. Like many other Facebook changes this was met with much much discontent. Still, it succeeded. By March 2015 the app had 600 million monthly active users, and by April 2015, Messanger was the second most popular app globally. Now Facebook is looking to build on the app's success with an API targeted exclusively at customer management.


Conversion simplicity

It only takes a Facebook login or a mobile message to convert a customer into a Messenger contact. And, in the right context, the immediacy and convenience alone makes it worthwhile to connect with a business through Messenger. These two factors could lead to a larger conversion rate to Messenger when compared to traditional CRM channels.

  • Potential conversion opportunities include:

  • Asking a retailer to notify you when a tee shirt is available in a different colour

  • Having your online delivery tracked

  • Resolving a complaint through a web form, customer service call or social media.

Each of these use cases creates an opportunity to convert a customer to a Messenger connection. And each conversion point becomes an opportunity for businesses to build stronger relationships with their customers.


New channel

With immediate access to 600 million users and growing, Messenger is a potentially powerful channel, ripe for exploitation. Businesses that can successfully integrate viral mechanics into their Messenger contact flows will be able to grow their CRM database at unprecedented speeds. Every customer contact on Messenger can be perceived as a new channel for the business.


Rich contextual media

Messenger enables publishers to post a range of rich media including video and call to action buttons. The call to action buttons are particularly powerful, allowing businesses to convert contacts to sharing or purchasing a product with the tap of a button. Here's an example of how this might play out:

  • Jenny finds a top she loves in store but her preferred colour isn't available

  • Staff member asks Jenny to sign up to Messenger using the relevent ticket number

  • Jenny is then sent a notification with a 'buy now' button

  • Jenny chooses to not buy within the app

  • When her top arrives at the store, Jenny receives a second notification - this time with a discount.


Notifications

In order to gain access to a customer's mobile (or watch) notifications, a business would traditionally need to create an app for customers to download and use. This is no mean feat! But with Messenger, businesses can now access this incredibly valuable real estate without having to break the bank.


Opportunities

Messenger is a powerful platform for CRM practitioners and will no doubt enable many new innovations. Some imaginable opportunities include:

  • A personalised shopping assistant that helps you while you shop in a mall:

    • Upload outfits as you try them on
    • Receive exclusive deals on the items through Messenger
  • International, cross-retailer loyalty programs

  • Using product recognition to integrate 'buy' buttons into shared images.


Risks

Overly relying on Facebook for managing critical business processes is an inherently risky proposition. In 2012 Facebook famously changed their Edgerank algorithm to the detriment of advertisers. Businesses that invested heavily in building a Facebook audience now need to pay every time they want to get in touch with their fans. Companies with Fan Pages are continuously increasing their media spend on Facebook.

Facebook is a publicly traded company. Their incentives are aligned with shareholders who are focused on quarterly returns. If businesses take to Messenger as they did to fan pages, Facebook may again charge for the right to interact with your contacts.


Recommended approach

Facebook's new Messenger for businesses provides a new world of CRM opportunities for businesses. As with any integrated service from an outside company businesses should tread carefully and not overly expose themselves. A recommended approach would be to:

  • Begin testing customer conversion rates between Messenger and traditional CRM channels

  • Compare Customer Lifetime Value (CLV) of Messenger customer to traditional customers

  • Exploit Messenger's strength, the friend network early

  • Identify methods to convert new Messenger acquisitions to traditional owned channels (email, online, app download).