Dell: From Silent to IdeaStorm

In five years, Dell went from being the poster boy of ignoring the emerging social Web to becoming a model for how to orient a company around social media. Its journey began in 2005, when Facebook was barely beyond a dorm room project. Problems with Dell customer service percolated on blogs under the moniker “Dell Hell.” The company, founded by Michael Dell with a focus on customers, reoriented itself to be more responsive.It’s gone on to become a social media star, ranked by Vitrue as one of the 10 social-media brands of 2009. It has built a strong social-media team that focuses on entwining those technologies within all aspects of its business, from customer service to marketing to research. Its activities include racking up $6.5 million in sales through Twitter, connecting with 3.5 million consumers on social sites and its own, and soliciting consumer input through sites like Dell IdeaStorm and Dell Tech Center.

“When we first jumped headfirst into this, we started with engaging and listening to consumers,” says Manish Mehta, vp of social media and community at Dell. “Hopefully that moved the needle. The business will at some point question how this is helping the P&L. That’s why taking a step back and finding the value drivers is so important.”

The company’s push into social channels left it with a conundrum: How could it evaluate efforts that were taking place all over the company to see if they were worth the investment? This fall, Dell’s social-media team mapped out a defined framework to guide those decisions. It identified a set of value drivers for the customer and for the business, looking for programs that overlapped the two sets. For consumers, Dell identified drivers like connections, recognition and advice. For its business, its drivers are things such as revenue, brand health, share of voice and customer sentiment.

“They are light years beyond what others are doing,” says Aaron Strout, CMO at social-media firm Powered in Austin, Texas. “They spend a lot of time thinking through how to translate that into real dollars. Quite frankly a lot of companies haven’t done a good job at that.”

Take the Dell Tech Center, one of the company’s less sexy social initiatives. The Tech Center is an online community for IT managers to go and connect directly with Dell engineers. Dell tracks it success based on fundamental metrics, like members, questions posed and answered, and traffic to the site. It also charts how many large-enterprise customers have interacted with the site through a post-purchase survey. Yet one of the key metrics is harder to define: evidence that it’s helping deals close quicker and stripping out costs.

“We’ve found our salespeople are referring prospects in there,” says Richard Binhammer, a senior manager on Dell’s social-media team. “It’s shortening the sales cycles.”

Binhammer and Mehta agree the key to pushing forward with social media at the company is a commitment at senior levels. As a tech company that sells most of its products online, this is easier at Dell, although there’s still work to do, Mehta admits.

“We want to make this be completely embedded into the fabric of the company,” he says.

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