Digital Marketing Direction: ECRM

By Erica Wenham, Tuesday 11 December 2012.

Digital Technologies For Marketing (Week 13)

What is CRM?

Customer Relationship Management (CRM) are methods that companies use to interact with customers. The methods include employee training and special purpose CRM software. There is an emphasis on handling incoming customer phone calls and email, although the information collected by CRM software may also be used for promotion, and surveys such as those polling customer satisfaction.

•         From the outside, customers interacting with a company perceive the business as a single entity, despite often interacting with a number of employees in different roles
and departments.

•         CRM is the combination of policies, processes, and strategies implemented by an organization to unify its customer interactions and provide a means to track customer information.

•         It involves the use of technology in attracting new and profitable customers, while forming tighter bonds with existing ones.

•         Initiatives often fail because implementation was limited to software installation, without providing the context, support and understanding for employees to learn.

•         Tools for customer relationship management should be implemented "only after a well-devised strategy and operational plan are put in place".

Elements of CRM include:

•         Front office operations

–        Direct interaction with customers, e.g. face to face meetings, phone calls, e-mail, online services etc.

•         Back office operations

–        Operations that ultimately affect the activities of the front office (e.g., billing, maintenance, planning, marketing, advertising, finance, manufacturing, etc.)

•         Business relationships

–        Interaction with other companies and partners, such as suppliers/vendors and retail outlets/distributors, industry networks (lobbying groups, trade associations). This external network supports front and back office activities.

•         Analysis

–        Key CRM data can be analyzed in order to plan target-marketing campaigns, conceive business strategies, and judge the success of CRM activities (e.g., market share, number and types of customers, revenue, profitability).

Benefits of CRM

•         Allows customer relationships to be managed more efficiently

•         Encourages a more customer-centric approach to conducting business.

Executives often cite the lack of proper tools as a barrier to delivering the experience their customers expect. A 2009 study of over 860 corporate executives revealed only 39% believes that their employees have the tools and authority to solve customer problems.

What is eCRM?

As the internet is becoming more and more important in business life, many companies consider eCRM as an opportunity to reduce customer-service costs, tighten customer relationships and most important, further personalize marketing messages and enable mass customization.

We can define eCRM as activities to manage customer relationships by using the Internet, web browsers or other electronic touch points. The challenge hereby is to offer communication and information on the right topic, in the right amount, and at the right time that fits the customer’s specific needs.

The challenges of eCRM

•         Channels through which companies can communicate with its customers, are growing by the day, and as a result, getting their time and attention has turned into a major challenge.

•         One of the reasons eCRM is so popular nowadays is that digital channels can create unique and positive experiences – not just transactions – for customers.

•         An extreme, but ever growing in popularity, example of the creation of experiences in order to establish customer service is the use of Virtual Worlds, such as Second Life.

•         Its highly interactive character, which allows companies to respond directly to any customer’s requests or problems, is another feature of eCRM that helps companies establish and sustain long-term customer relationships.

•         Furthermore, Information Technology has helped companies to even further differentiate between customers and address a personal message or service. Some examples of tools used in eCRM:

-          Personalized Web Pages where customers are recognized and their preferences are shown.

-          Customized products or services (Dell).

•         CRM programs should be directed towards customer value that competitors cannot match.

•         However, in a world where almost every company is connected to the Internet, eCRM has become a requirement for survival, not just a competitive advantage.

The three levels of eCRM

•         Foundational services:

–        This includes the minimum necessary services such as web site effectiveness and responsiveness as well as order fulfillment.

•         Customer-centered services:

–        These services include order tracking, product configuration and customization as well as security/trust.

•         Value-added services:

–        These are extra services such as online auctions and online training and education.

Self-services are becoming increasingly important in CRM activities. The rise of the Internet and eCRM has boosted the options for self-service activities. A critical success factor is the integration of such activities into traditional channels. An example was Ford’s plan to sell cars directly to customers via its website, which provoked an outcry among its dealers network. CRM activities are mainly of two different types;

1.      Reactive Service is where the customer has a problem and contacts the company.

2.      Proactive Service is where the manager has decided not to wait for the customer to contact the firm, but to be aggressive a contact the customer himself in order to establish a dialogue and solve problems.

Developing an eCRM Strategy

 Customer relationship management (CRM) is all about managing the relationships you have with your customers—including potential customers. CRM combines business processes, people, and technology to achieve this single goal: getting and keeping satisfied customers. With relationship marketing, it is better to maintain a long-term relationship with customers rather than a transactional approach. It is based upon building up permissions, trust, listening and then responding to consumers.

It's an overall strategy to help you learn more about your customers and their behavior so you can develop stronger, lasting relationships that will benefit both you and your customers. It’s very hard to run a successful business without a strong focus on CRM. After all, it’s all about the customer.

Successful CRM involves many different areas of your company, starting with sales, of course. But also various other customer-facing areas, like marketing and customer service. Salesforce.com offers a technology solution for all those areas… and more.

DRAMA

eCRM provides DRAMA – Dialogue, Relevancy, Accuracy, Magic and Access to Marketing Communications.

·         Dialogue

-          Every message sent should allow for a response

-          Website design should facilitate capture of in-bound enquiries

-          Processes should be defined for responding to unsolicited enquiries

-          Demonstrate listening skills as well as talking and telling

·         Relevancy

-          Making mass communication personal and relevant to the recipient

-          Dangerous now not to somehow tailor the message

-          Therefore avoid bulk messages

·         Accuracy

-          Data quality is key

-          Poor quality can originate from customers form completion

-          Develop and implement processes for data cleaning

-          Especially is data is being presented back to customer

·         Magic

-          Customer delight to customer amazement to delivering magic in communication

-          Technically advanced packages of information:

§  Animation

§  Sound

§  Interaction

§  Prizes

§  Incentives

§  Collection Schemes

-          The Creative Execution

·         Access

-          Delivering the message with the right frequency

-          Not too often

-          But not ignored

-          Profile segments by desire to be involved/included

-          Role of RSS

-          Survey tools

MCRM

One subset of eCRM is Mobile CRM (mCRM). This is defined as “services that aim at nurturing customer relationships, acquiring or maintaining customers, support marketing, sales or services processes, and use wireless networks as the medium of delivery to the customers.

However, since communications is the central aspect of customer relations activities, many opt for the following definition of mCRM: “communication, either one-way or interactive, which is related to sales, marketing and customer service activities conducted through mobile medium for the purpose of building and maintaining customer relationships between a company and its customer(s).

eCRM allows customers to access company services from more and more places, since the Internet access points are increasing by the day.

mCRM however, takes this one step further and allows customers or managers to access the systems for instance from a mobile phone or PDA with internet access, resulting in high flexibility. An example of a company that implemented mCRM is Finnair, who made it possible for their customers to check in for their flights by SMS. Since mCRM is not able to provide a complete range of customer relationship activities it should be integrated in the complete CRM system.

Profiling

•         Helps identify groups of customers and rank them according to their importance to achieving business or organisational objectives

•         Appropriate communications and offers can then be developed for these groups with the aim of building long-term relationships with them

Personalisation

•         Refers to tailoring a range of communications from emails to websites. These can be individual (one-to-one) or to segments (mass customisation).

•         Personalisation can occur due to;

–        User selection (customisation)

–        Marketing rules (individualisation)

–        Group Characterisation such as collaborative filtering