Welcome to the One on One conversation series, where Small Business Trends will be speaking to some of the best minds in business today. The goal of the series is to pick the brains of successful entrepreneurs, best-selling author, and executives with organizations serving the small business community, to provide the Small Business Trends community with their valuable business insights.
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Jon Ferrara is a serial entrepreneur and a pioneer in the customer relationship management (CRM) industry. He co-founded Goldmine, one of the first contact management apps; his newest company, Nimble, is a social CRM service for small businesses.
Brent Leary spoke with Ferrara in this interview, which has been edited for space. To hear a full, audio version of the interview, scroll down to the loudspeaker icon at the bottom of the page.
Question: What is different about starting this kind of company now, as opposed to when you started Goldmine?
Jon Ferrara: I think the best ideas come from your own need, because you are passionate about it and you understand the problem. When I started Goldmine, I saw a need for teams to communicate and collaborate together, and to integrate that communication back to their customers and prospects. Goldmine was the first networkable sales team tool.
Today, I am seeing the same type of need. Small businesses need to attract and retain customers more than ever. But the way they are doing it has radically changed. Customers aren’t [paying attention to] your advertisement; they are having dialogues amongst themselves about what they are going to buy.
Smart companies today are figuring out that they need to find out where those conversations are occurring and get in there and listen and engage, leveraging the way customers want to talk today. Many times that is social media and the Web.
Question: How has the Internet changed business relationships, particularly at the small business level?
Jon Ferrara: Business relationships have always been social. People buy from people they like, and they like people who know them. The only way to know them is to listen. I tell all my salespeople that when they go into a customer’s office, they need to look at the walls. People put things on their walls that enable you to build connections, relationships, intimacy, which leads to trust. Today, social media enables you to listen, engage and look at people’s walls in wider ways than you ever thought possible. Smart businesses today are leveraging social media to connect with their customers.
Question: What lessons did you learn from starting and running Goldmine in the ‘80s and ‘90s that help you with Nimble today?
Jon Ferrara: The environment that I built Goldmine in back in the late ‘80s is the identical environment that we find ourselves in today. There was a recession; people were looking for ways to do things more effectively and better and to do more with less. We bootstrapped Goldmine, and the lesson I learned is that you don’t need to spend a lot of money to reach customers. Back in the day, we called it PR. Today, people are leveraging social media to get their message out and build connections and relationships. That is really what has changed for today’s startups and small businesses, and I think the companies that understand how to leverage social media, to listen, engage and communicate and collaborate internally and externally, will be the companies that will grow fastest.
Question: With Nimble, you are building an on-demand, social CRM service aimed at the small business market. Goldmine was aimed at the salesperson and sales teams, correct?
Jon Ferrara: Our idea with Goldmine was that people don’t work in a vacuum, they work as a part of a larger team, and everybody on the team touches the customer. Goldmine was the first networkable relationship manager, but it was not just for salespeople, because it’s not just salespeople that touch your customer. That is a mistake that many companies make — empowering just their salespeople with contact or relationship tools. Everybody should be open to connecting with the customer.
What’s different about Nimble is, where Goldmine leveraged the network to enable a team to communicate and collaborate, we are leveraging the Web and social media. Nimble not only allows your team to internally communicate and collaborate, but also to listen and engage. By listening and engaging, you are able to build thought leadership on top of [data] mining, in ways that are just tremendous.
Question: Do you think CRM is more important to small businesses today, or was it more important back when you were building Goldmine?
Jon Ferrara: I think it is absolutely more important today. The old ways of touching your customer — cold calling, direct mail, advertising, faxing — just don’t work anymore. If you empower your team to touch the customer and to listen and engage, it will transform your business. Small businesses are nimble, and by leveraging these new methodologies of connecting with customers, they can transform their businesses much faster.
Question: Do you think successfully implementing CRM hinges on being able to integrate social media into a CRM strategy?
Jon Ferrara: Without social, CRM is a stale database. Goldmine helped create the first model of networkable relationship management. Today, what’s different is the social aspect. If all you are going to do is CRM, you can do databasing with anything. But combining the ability to communicate and collaborate, to listen and engage, transforms a business.
Our customers are crying out for one-to-one relationships and connections. Companies that listen to their customers and engage in conversations will be the companies that have customers for life. Don’t we all want that?
This is part of the One-on-One Interview series with thought leaders. The transcript has been edited for publication. If it's an audio or video interview, click on the embedded player above, or subscribe via iTunes or via Stitcher.