Linkdump: CRM and the demise of GM
June 17, 2009 at 09:14 | In CRM, Customer Experience Management, Linkdump, Sales Force Automation | Leave a CommentTags: 2009, automotive, CRM, Linkdump
Check out this interesting article by Dennis Pombriant on CRM in the automotive industry.
Customer loyalty: are loyal customers really profitable?
June 15, 2009 at 09:50 | In CRM, Customer Data, Customer Experience Management, Linkdump | Leave a CommentTags: Harvard Conversation Starters, Loyalty Management, Why Loyalty Matters
I’ve been doing quite a bit of research into customer loyalty and customer loyalty programs for a paper I’ve written for the Executive Master of Information Management Programme I’m attending at TiasNimbas Business School. The literature on loyalty and loyal customers seems to suggest that investing in a loyalty management program does provide a company with a source of competitive advantage. In other words: loyal customers help to improve the performance of your company!
I’ve just stumbled upon an interesting blog post by Timothy Keiningham and Lerzan Aksoy over at Harvard’s Conversation Starters blog. Timothy and Lerzan are working on a book on customer loyalty and outline why customer loyalty can also be a bad thing:
The fly in the ointment is that typically only 20% of a firm’s customers are actually profitable. And many — often most — of a company’s profitable customers are not loyal.
Timothy and Lerzan argue that in the current downturn companies focus too much on lowering prices in order to gain more customer loyalty.
But the simple solution to improving customer loyalty in a down market is to offer price deals. In fact, firms that track their customer loyalty can be guaranteed that loyalty scores will increase with each substantial decrease in price all things being equal.
But that’s a bad loyalty strategy. No, this doesn’t mean we should not find ways to be more efficient so that we can pass cost savings on to our customers. But price-driven loyalty is always the lowest form of loyalty. It means that we aren’t offering differentiated value to our customers.
The key in their argument is the fact that truely loyal customers and profitable loyal customers are created by focussing on providing an added value and differentiated offer for your customers. Only then do you get a competitive advantage from loyalty management.
Be sure to check out Timothy and Lerzan’s book Why Loyalty Matters and read their full blog post.
CRM in a downturn (2) – a poll on CRM focus
March 12, 2009 at 20:57 | In CRM, CRM 2.0, Customer Experience Management, Customer Service, Investment, Marketing, Predictions, Survey | Leave a CommentCRM in a downturn (1) – links
March 12, 2009 at 20:52 | In CRM, CRM Daily, Customer Data, Customer Experience Management, Customer Service, Linkdump, Paul Greenberg, Predictions, Sales Force Automation, Series | Leave a CommentMost of the western world is suffering the economic effects of the credit crunch, which has turned into a full blown recession for most countries in Western Europe and the US. It seems that most CRM efforts are now focussed on customer retention, rather then improving service or acquiring new customers. This post provides links to a number of blog postings and articles that focus on CRM in a recession.
Paul Greenberg – Customer experience, recession – fan friendly?
CRM Daily – Beyond survival, winning in a global recession
Jim Berkowitz - How Leading Companies are Optimizing Sales Through Data Integration and Analytics
and finally an interesting post by Dave Kurlan, on what really matters.
I’ve probably left out a whole lot of posts that deal with the same topic and provide interesting inside information. So, what should I add to this list?
Linkdump – CRM and the sustainable organisation
January 25, 2009 at 20:47 | In CRM, Linkdump, Success, Sustainability | Leave a CommentIn december of last year I wrote a post about 2009, the year of sustainability and sustainable CRM. Yesterday I came across this article on MyCustomer.com, with an interesting quote on customer sustainability:
What makes a company sustainable?
Customer relationships can build an asset to provide a cushion against changes in the market, according to Kirkby – a kind of ‘brand halo’. This is where a brand can reach market share peak, have very high salience and become a market leader, but also remain a market leader long after it doesn’t deserve to be any more simply because people remember its status and think it is still on top.
End year credits – Top 20 CRM Bloggers
January 8, 2009 at 17:46 | In 2008, CRM | Leave a CommentTags: Top blogger
In 2007 I was added to the top CRM bloggers list of InsideCRM.com (great site, go check it out). On December 29, 2008 Chris Bucholz published an updated version of the list, update for 2008. The list is full of interesting CRM blogs everyone should check out, and fortunately for me I’m on the list once more, featured in a list that also contains the big minds in CRM such as Paul Greenberg, Brent Leary, Christopher Carfi and, Mr. VRM himself, Doc Searls. I hope I’ll make the list again next year.
On 2009 – the year of sustainability
December 28, 2008 at 13:50 | In CRM, CRM 2.0, Contact Center, Customer Service, Predictions, Service Effectiveness, Success | 1 CommentTags: 2009, Loyalty Management

a sustainable world
The new year is approaching, 2008 is ending with some of us feeling the consequences of the credit crunch. It’s time to look towards the future. Every new day and new year opens a wealth of new opportunities, even in a crisis. 2008 ends with a starting recession, many business are facing tough times. I do not have a crystal ball and am not much of a fortune teller either, nonetheless I would like to offer my views on 2009, from a CRM perspective that is.
2009 – the year of sustainability
In 2007 and 2008 we’ve been able to see a new trend rise, sustainability and environmental awareness. We’ve come to realise that we need to use the earth scarce resources wisely. Sustainability can also be applied as an economic and not environment term however. Wikipedia lists the following for the term sustainability:
Sustainability, in a general sense, is the capacity to maintain a certain process or state indefinitely.
(src: http://en.wikipedia.org/wiki/Sustainability)
So sustainability can also be applied to your business as the capacity to remain operating and to remain in business. How could one survice the current economic crisis and what does sustainability in crisis mean?
- Sustainable operating model
- Sustainable customer base
- Sustainable investments
A sustainable operating model
The first thing companies focus on in a crisis is operational excellence. Reducing expenditure and increasing efficiency. Cut out unnecessary costs and focus on the core of your companies operation. This could mean divesting or closing retail outlets and changing your channel partner strategy. Perhaps others are better at selling and marketing your products than you are. Operation Excellence also marks a path to lower cost channels, such a self service internet channels as opposed to contact centers or an on-site repair man. In other words, I believe that 2009 will lead to companies employing self service more and more, as a means to both improve customer service (24/7 access) and reduce cost.
Sustainable customer base
During a boom companies typicall focus on Sales & Marketing when it comes to their CRM investments, trying to get a piece of an ever increasing pie. In a crisis the pie usually stays the same size or gets a bit smaller. Unless you provide an innovative product or service for which a whole new pie exists, you will try to have to make do with getting a bigger piece of the existing pie. The focus, in my view, should be to focus on preserving your existing customer base through excellent service, and gaining new market share through word-of-mouth marketing. Spending heavily on marketing campaigns for a .05 percent marketshare increase is nonsense if your existing customers are leaving. So keep your current customers, provide excellent service, preferably better than your competitors, and gain marketshare that way. After all, the cost of acquiring a new customer is 5 times higher than keeping your existing customers and convincing them to spend a bit more with your company.
Sustainable investments
Due to the credit crunch most companies are no longer able to draw unlimited financing from either the stock market, or the credit market, one has to invest wisely. Invest in improving your current products or services, products or services that are complimentary to your current portfolio and invest in customer service. Secondly make sure you invest in a way that is environmentally sustainable and use that as a marketing tool.
Sustainability and CRM?
So what does this mean for your CRM efforts. I feel that 2009 will see an increase in spending on improved customer service, through more possibilities for self service, increased spending on cost-efficient call centers (through products such as Oracle Contact Centre Anywhere) and increased spending on loyalty management applications. Loyalty management spending will be directed at keeping existing market share and growing the existing customer base through word-of-mouth marketing.
I’m looking forward to another interesting year in CRM, CRM Applications and IT.
On solving the customer service puzzle (or CRM is a business strategy, NOT software!)
October 7, 2008 at 12:02 | In CRM, Customer Experience Management, Customer Service | 1 CommentOr atleast, one view on how the pieces of the puzzle can be made to fit. Drew stevens recently wrote an article on the customer service puzzle, which was brought to my attention
by Jim Berkowitz . The focal points of Drew’s article are ensuring the whole company focusses on providing an excellent service or product to your customer and ensuring you regularly interact with your customers. Something we can all agree with.
Drew also outlines one point I disagree with: ‘refrain from CRM’. Like many others Drew mistakenly views CRM as ’software systems’. CRM is not a piece of software or a system, but a business strategy. The business strategy that should force companies to focus on providing added value to customers. In other words, CRM is the ‘focus on the customer throughout the whole company’ that Drew is referring to. Paul Greenberg’s definition of CRM systems says it best:
“CRM is a philosophy & a business strategy, supported by a system and a
technology, designed to improve human interactions in a business environment”.
CRM systems, like Oracle’s Siebel CRM, SAP CRM and salesforce.com are valuable enablers to help companies achieve their customer focussed business goals, if implemented in the right manner. CRM and CRM software implementation should be about your business goals,
and not because some IT guy wants to try out a new piece of fancy software. So Drew, I agree with your points, but I think that implementing a CRM application with your other points in mind will only help a company to solve the customer service puzzle.
On the rise of IP based Contact Centers
September 10, 2008 at 09:17 | In CRM, CRM 2.0, CRM Daily, Contact Center, SaaS | Leave a CommentA few interesting points from a recent article on CRM daily: IP Systems have come of age. The need for truly integrated call centers, lower cost infrastructure and the lower costs of IP based systems are leading to a rise in the implementation of IP based Contact Center systems. Fully integrated systems that can handle multiple channels (Voice, Chat, E-mail and Fax) in a single queue and over different locations, instead of the loosely integrated, old, copperwire based PBX and TDM systems.
some interesting quotes from this article.
“That cut-over to having a majority of contact center seats IP-enabled could occur in the next few years. This trend, say analysts and suppliers, is being driven by legacy switch replacement cycles, adoption of IP by small/midsized contact centers, new sites, remote agents and informal contact centers, and by customer migration to text and e-mail from voice.”
These IP based systems are not always implemented as a replacement for TDM based systems, but sometimes serve as an addition, enabeling quick deployment of new call and contact centers.
“Raun Kilgo, Director of Product Management, Aspect reports that while there has been increased IP adoption among his firm’s customers it has not been, in most instances, as replacements for TDM. “
“Most of our customers have already invested in and are comfortable with TDM applications for their mission-critical inbound and outbound work and would need
a compelling event to rip and replace their existing infrastructure ,” reports
Kilgo. “Alternatively, IP is the ideal solution for companies implementing new
contact centers or deploying remote or at-home agents.”
Remote agents or the possibility to quickly scale up a call center in the event of an adverse event are benefits an IP based solution offers.
“Another advantage IP provides is reduced facilities and IT expenses through less wiring and no need for separate phone rooms: calls are increasingly handled via integrated, centralized and often off-site data centers. That also means faster, easier, and less costly expansion. New contact centers can be up and running in weeks, with no more sometimes lengthy waits for the telcos to install the lines.”
The real advantage of having an IP based solution, in my view, is something which could be dubbed the pervasive contact center. All your employees can virtually become part of the call center, so that experts are able to answer your customers inquiries, when an agent is not able to. Providing a correct and direct answer to a question, without the hated call back request is something should enable you to quickly increase customer satisfaction.
Call escalations, especially support calls to outside experts at regional or head offices or who are mobile or at home are easier to set up and have greater functionality with IP, provided it is coupled with unified communications.
In other words, IP based contact center systems hold a lot of promise for the present and the future, when combined with On Premise or On Demand based CRM applications can enable you to better serve your customers and achieve higher levels of customer satisfaction.
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