CRM: Management, Marketing or both?

September 1, 2001 Marketing Comments (0) 138

The acronym CRM is a confusing one. Many people say it stands for Customer Relationship Management, while others suggest Customer Relationship Marketing. Let’s take a look at how both of these acronyms are playing out.

Customer Relationship Management

In the mid-90’s while many of us were working on Marketing Information Systems (MkIS) to support focused customer strategies, most software and systems vendors were busy building and selling “Customer Relationship Management” software as a way to capitalize on the growing interest in the acronym “CRM.” Fueled primarily by this influx of CRM software and systems, most people began to accept that “CRM” stood for Customer Relationship Management, and began their attempts to manage relationships with customers. Most organizations taking this approach have found that their CRM initiatives have failed to live up to expectations–both financially and with stronger relationships with their customers.

CRM–as defined through systems and technology–relies heavily on customer data, information, buying patterns, and the like. It assumes we’re able to gain the data we need to do a better job of “managing” the customer’s needs, values and expectations with our business. However, customers don’t tell us everything and assuming they did, there are so many external factors that will influence a purchase decision or loyalty to the business, we could never hope to have databases large enough or powerful enough to allow us to manage relationships for any length of time with any sustainable success. We try anyway. As a result, most of us are data rich and information poor and have learned the hard way that CRM is not about systems and technology. High hopes that having more customer data would lead to more effective and targeted marketing programs that would lead to higher revenue for the company have been dashed. Simply capturing the data and trying to sell the customer more things doesn’t do a darn thing improve the relationship-a the fact that many have learned the hard way.

Customer Relationship Management is perhaps a misnomer. A better term for the systems and technology aspect might be Customer Information Management.

Customer Relationship Marketing

The term Customer Relationship Marketing–or the other CRM–seems...

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Short-circuit CRM troubles with a solid foundation

July 1, 2001 Marketing Comments (0) 130

Adopting a customer-centered marketing strategy sounds simple. Focusing on the customer’s needs, values, and expectations, and subsequently providing value for the customer, is a goal to which many companies aspire, but far too few deliver. The key to successful implementation of a customer-centered strategy comes with the realization that technology alone cannot solve any problem without the people and processes in place to make it actionable. The reality is most companies don’t have an integrated infrastructure-technology, people and process-in place to support such an initiative.

Nearly every company focuses on the technology component of the infrastructure and assigns the people and process portions to a lesser level of importance. Technology rarely prevents a customer-centered initiative from being successful. More often than not, human behavior and organizational process are the inhibitors to success.

So, how can you ensure success with such an initiative?

Start by asking yourself the following questions:

  • Have your employees proven themselves willing change the way they work, if necessary, to provide better service to the customer?
  • Is your entire company well-trained in the art of customer service, and is everyone customer-focused-regardless of their contact frequency with the customer?
  • Do you have all the data about your customers that you need?
  • Are your systems capable of supporting your goals and objectives, in line with your customer’s expectations?

If you have found that you can’t answer “yes” to each of these questions, you are not alone. Nevertheless, you have taken the first step in recognizing and accepting your company’s shortfall, as it relates to your Customer Relationship Management (CRM) capabilities. To get back on track, keep in mind the three dimensions of CRM: technology, human behavior, and organizational process.

Technology: Data, Systems, and Information.

If you are going to be effective in implementing a CRM strategy, you’re going to need many different data sets. Data not just about your customers and their purchase patterns, but also data about your products and services, your prospective customers, your competitors, the market, the economy and perhaps the regulatory environment. Next, quality technical capabilities are a must. To be most effective in accomplishing your strategies, you will need to be able to...

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Playing Games with Wireless Advertising

June 6, 2001 Innovation, Technology Comments (0) 142

I read an interesting article the other day about wireless advertising. The article featured a firm called Mobliss (now PressOK Entertainment) that is fast becoming what some industry experts believe to be one of the leaders in the delivery of wireless advertising. They may very well be on to something.

Mobliss founders have developed a pretty unique business model that delivers advertising, with permission, to those looking to “save time or to kill time.” Mobliss, which views itself as a media company, has bet on the “kill time” approach to engaging the consumer. Through the use of gaming and entertainment-oriented content, Mobliss can deliver promotional messages with to wireless devices. These promotions can also be targeted, relevant and location-based. The firm has partnered with gaming and entertainment providers-Group Lotto and Tribune Media Services, among them– for branded content.

It works by offering a variety of message opportunities–from contextual advertising to mobile alerts–to those accessing the Mobliss servers. One example is their recent partnership with 1-800 Contacts where users, after playing the word unscramble game, Jumble, are presented with an opportunity to call 1-800 Contacts to order contact lenses. In this case, the campaign is even integrated into the game, with the word “vision” as one of the jumbled words. Like other web-based marketing programs, Mobliss promotions can be tracked and are measurable in a variety of ways.

As I read this article, I couldn’t imagine anyone sitting around playing games on their cell phones while killing time. I then remembered; the day prior I was sitting in the airport waiting to pick up a friend and found myself, for the first time, playing a game on my cell phone. The difference is that my game is loaded on the phone and doesn’t cost anything to play. To take advantage of these other games or entertainment, it requires a connection to a server, and that means I’m paying for the call and the data transfer. Call me cheap-make that “frugal”-but, I’d never do it as long as the wireless pricing models are as they are today. That does not mean, however, that...

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Preparing for trouble with CRM

June 1, 2001 Marketing Comments (0) 133

It goes without saying that Customer Relationship Marketing (CRM) is one of the most prevalent and important initiatives undertaken by corporations both large and small. Yet, industry experts claim that nearly five out of every ten CRM initiatives fail. What’s the difference between those that succeed and those that fail? What does it take to successfully implement CRM?

My observations from successful CRM initiatives suggest that success can be, in part attributed to the ability to strategically manage the various aspects of CRM within the context of your organizations broader business direction. Based on our experiences, we suggest organizations consider the following points when developing and deploying a CRM initiative:

  • Create a strategic CRM vision. Buying the latest and greatest CRM software application or developing the slickest e-commerce site will not solve your CRM challenges. While technology certainly plays a major role in supporting the success of CRM, CRM is really a strategic initiative. It’s a way of doing business, not just a way of managing information. As such, a CRM initiative will be most successful if an organization has a clear vision for how it wants to deliver value to its customers.

A strong CRM vision is critical because it helps ensure that the decisions made in selecting technology will be made on the basis of the goals of the company and not be driven-or limited-by the functionality or capability that a particular software application may provide. Remember that technology should support the vision of CRM, not drive it.

  • Avoid the cookie-cutter technology approach to CRM. Every business has a unique way in which it deals with its customers, and while there are many technological CRM solutions that designed for your particular industry, virtually all will need customization to address your specific organizational needs to build loyalty with your customers. The goal with CRM is to differentiate your business from your competitors. If everyone uses the same technology or software application without customization, there’s no significant competitive differentiation and you’ve gained little from your investment. Make sure the application purchased meets the needs of the organization.
  • Manage the number of...

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Information you need, exactly when you need it

May 14, 2001 Technology Comments (0) 148


The wireless age is upon us, but as many of you know, it’s plagued with challenges. Chief among those challenges are limitations in bandwidth and costs for developing applications and supporting infrastructure. One start-up, Roamable (www.roamable.com) is attempting to work around those challenges by leveraging the infrastructures that most organizations already have in place. Roamable’s technology platform allows an organization to offer content to users in a format with which they are already familiar-e-mail. Best of all, the content can be delivered on virtually any e-mail compatible device-from a RIM (BlackBerry) Pager to a Web-enabled phone.

For marketers, this technology, like many others can improve value to customers by providing such services as updates on order status, access to purchase history, and current sales promotions. However, what’s different, and perhaps most intriguing about this technology its ability for dynamic interaction. Unlike most wireless content that’s pushed from a business server to a user, this technology allows content to be pulled based on a user’s request-enabling information to be provided both on demand, and with personal relevancy. Let us look at a couple of examples of how this might work.

I am on my way to the airport for a flight from New York to London. It is a particularly long flight and I’m bushed so I want to upgrade my coach seat to First Class, or at least Business Class. I want to use my frequent flyer miles for this upgrade, but I’m uncertain as to how many miles I have available. Using my web-enabled phone, I press a predefined number to send a message request to my frequent flyer account. Within a few seconds, I get a response that provides not only my available miles, but also the length, if any, of the wait list. If I so desire, I can then acquire the upgrade or be placed on the wait list-all done easily and within a few seconds time as I travel to the airport.

Another example might involve applications for a direct sales force, such as dynamic lead presentation by a specific geography (“I’m on Michigan...

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The Trouble with CRM: Tomorrow’s forecast – Sunny with some early fog.

April 23, 2001 Marketing, Technology Comments (0) 146

When CRM began to evolve in the mid-90’s every software vendor who had an application that had anything to do with managing customer or prospect data began pitching itself as a “CRM System.” Many of these systems were built to address one particular aspect of CRM, such as Sales Force Automation (contact management, Campaign Management, or Customer Analytics, and could not possibly deliver the value promised as “CRM System”. It was a case of “over-promise and under-deliver.”

Unfortunately, there were no end-to-end technology solutions for CRM at the time, and today, there still aren’t (although we’re getting closer). As much as vendors collaborate with one-another to provide an “integrated solution,” the results have been less than stellar. One only needs to read the Wall Street Journal or any number of business and trade
publications to learn about the failures of CRM System implementation where multi-system integration is involved. It’s no wonder that Pragmatists don’t believe that CRM Systems are worth the investment. However, this may be about to change.

While there are undoubtedly a few CRM System vendors who are trying to monopolize the market with an end-to-end solution, there is a somewhat conscious move by most CRM System vendors to segment themselves into specific vertical segments. At this writing, these vertical segments seem to be:

  • Sales(Sales Force Automation, Contact Management, and Telemarketing)
  • Marketing(Campaign Management, Online/E-mail Interaction Management and Marketing Management)
  • Data Management and Analysis( Business Intelligence, Customer Segmentation and Data Transformation)
  • Customer Service(Order Management, Supply Chain Management, Call Center Management and Interactive Customer Contact

By self-segmenting into these categories, CRM System vendors will ultimately force segment standards, against which all vendors within the segment will be measured. This is the first step to vertical segment consolidation, which will force the smaller, less well-funded players into merging, or failure. In the end, there will likely be 5-7 major players in each of these segments.

So, what does this mean for marketers and how can we benefit from coming change? Here are my Top 3 predictions, with a few thoughts on how we, as marketers, will benefit:

  • CRM System vendors will concentrate on delivering value within...

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The Trouble with CRM: It’s always darkest before the dawn

April 22, 2001 Strategy, Technology Comments (0) 125

In the last four years, billions of dollars have been spent on CRM technology that doesn’t live up to its promise. A recent Gartner study suggests that nearly 60% of managers will view their CRM initiatives as failures. Organizations are wise to be skeptical of CRM system capabilities, but they are as much to blame as the system vendors. Many of the organizations that have failed with CRM did so because they did not conduct appropriate cost-benefit-analyses, reevaluate processes, procedures, and organizational structure, or fully develop CRM as a business strategy. Instead, they invested only in the technology, because as one manager said to me, “This software will solve all of our problems.” It didn’t, and it won’t. At least not without addressing all of the other issues.

Not surprisingly, some of my friends in the CRM system business tell me that closing sales so far this year has been unusually slow. While undoubtedly, the cause of some of this slow-down is due to reduced Marketing and IT budgets, there is a growing realization among most organizations that CRM is a business strategy supported by technology and not a technology in-and-of-itself. It is likely this realization is playing a significant role in causing the current CRM system space to stumble. So badly, perhaps, that the rash of closures, layoff announcements and revised earnings projections announced daily by the major CRM system vendors, may leave many to wonder if spells doom for the CRM systems space. I would disagree with the doomsayers, as I believe this fall-out is necessary for the space to evolve.

Consider this. Some years ago, Geoffrey Moore (www.thechasmgroup.com) wrote a book called, Crossing the Chasm. In it, he discussed his theories on technology adoption, and how innovators and early adopters (called “Visionaries”) drive the early market acceptance of technology, while the early majority (called “Pragmatists) help drive mainstream acceptance of the technology. The Chasm occurs when the Visionaries don’t see enough of a head-start advantage to adopting the technology, and the Pragmatists don’t see any compelling reason to jump on the bandwagon. This is what I...

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Reaching the Right Person at the Right Time

April 7, 2001 Innovation, Technology Comments (0) 134

One of the golden rules of successful marketing, as you well know, is the ability to deliver the “right” message to the “right” customer (or potential customer) at the “right” time. The CRM movement has managed a credible job helping us all to pull together the “right” message for the “right” customer, but we yet to be able to deliver that message at the “right” time. In other words, we still have difficulty in getting a message to the customer when s/he is predisposed to buying.

I was thinking about this other day, when I read a blurb about a company call BlueLinx (www.bluelinx.com) in Charlotte, NC. BlueLinx has developed a product called “Q-Zone,” which allows people and organizations to control environmental disruptions of cell phones, pagers, and other types of noise-making portable electronic devices. Q-Zone uses the emerging Bluetooth (www.bluetooth.com) wireless technology to create “quiet zones” within churches, concert halls, conference centers, restaurants, hospitals, movie theaters, and other public places. Essentially, the technology turns the devices “off” when entering a quiet zone and “on” upon leaving. When I finished reading about BlueLinx, it occurred to me that this same or similar technology could be used bridge the delivery gap and get the message to the customer pretty close to the “right” time.

Let’s consider how this could work. I’m in the market for new shoes, so I decide to go the local mall to shop. Once there, I turn on my web-enabled phone (PDA or another device) and let the shoe sellers in the mall know that I’m interested in buying a pair of size 12, black wing-tips. Within seconds I’m made aware of the stores that have size 12 black wing tips in stock, and the pricing. I may even be offered discounts or other freebies for the purchasing the shoes with a particular merchant. I can then visit each retailer, examine the quality and comfort of the shoe, and determine the most appropriate fit for me.

This same concept could be applied to hotel rooms, restaurants, gas stations, and a host of other merchants. Best of...

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