|
There is no doubt that there is a worldwide need for good CRM solutions today. We are all familiar with the scenario when OAPs are sent 18-30 club promotions or having pressed 1, 2, - 300 we are assaulted by ghastly hold music for fifteen minutes. There is also no doubt that excellent CRM solutions are in abundance but, without proper positioning by the vendors, not many end users will reap the benefits.
In the US, it was estimated in March 2001 that there were at least 400 companies selling CRM products, and about 200 in the UK. Our own research has identified about 220 companies in the UK with some mention of CRM in their marketing material. Included in these estimates are telephony solution providers, business intelligence vendors or basic marketing companies.
Why is there not a bigger take up of CRM by companies?
A recent survey by IDC asked 405 European companies about their attitudes towards CRM systems. Over 50% saw CRM as critical to their company, but about a third were not interested at all, with the lowest interest being found in Germany and France. The highest levels of interest were found in the UK and Italy. The German figure is interesting, given the high concentration of CRM vendors there. It would probably be fair to conclude that this is a reflection of the German IT industry: technology driven rather than market lead and therefore a classic early adopter market.
In the market as a whole, the early adopters have emerged in financial services and telecommunications where the advantages of CRM are more obvious. For end users like healthcare and utilities, the benefits are largely confused by the hype. Hence, the potential benefits of CRM are misunderstood, and in many cases CRM systems are a mystery.
Adoption of CRM solutions:
(Source: International Data Corporation)
High-pressure sales and an excess of hype, are widely recognised as a problem in the CRM technology market. Furthermore, end users are confused because there has been little attention paid to what CRM is exactly.
What is CRM and what are the benefits?
According to Thomas Siebel, CRM encompasses “marketing, sales, services. partner relationship management and employee relationship management” and should “allow (the organisation) to manage, synchronize and coordinate all customer touch points”.
Simply put, the benefits and goals of CRM are to keep and gain customers and to enable the organisation to engage in properly targeted marketing. To facilitate this process a CRM solution needs to present a united face across all channels and to deal with enquiries efficiently.
Why are so many good products causing so much disappointment?
Mark Smith, president and chief marketing officer for Quadstone, has said: "In the race to sell technology, vendors have pushed aside the fact that CRM has to be a business process driven by intelligence and analytics.” In many cases, only part of the solution has so far been implemented – the customer interaction component. What companies also need is to analyse and measure the customer information that is produced from a CRM solution in order to drive the business forward.
|
|
|
|
The recent horrific attack on New York and Washington has left most of the world stunned. Like many others, we feel that carrying on as normally as possible will be one way to ensure that the perpetrators do not achieve their aims.
|
|
|
|
|
|
|
|
|
|
SSP is collaborating with the CSSA for the “Partnering in a Global Economy” seminar.
Speakers will include representatives from SSP, jBase, Cap Gemini Ernst & Young and Data Distilleries
For more info click here.
|
|
|
|
|
|
GNER takes a new approach
GNER, the train operator, plans to invest in CRM. With its franchise running out in two years time, buying new trains is not an option, so improving relationships with customers is seen as an alternative revenue earner. At the moment customer contact is through at least four different channels: telephone, web, travel agents and the train stations themselves. Currently these are all quite separate. With 14 million customers, a CRM solution is seen as the best way to integrate them all. Such a solution will complement an already very successful complaints system.
|
|
|
However, it could be argued that the most sensible approach is to implement a CRM solution that enables the end user to manage its customer relationships efficiently, and then after a suitable interval to add in the analytical functionality. Quadstone, SAS and Broadvision, amongst others seem to have adopted this approach.
Sybase concludes, after a recent survey of its own, that many organisations are dissatisfied with their CRM solution because very little investment has gone into analytical tools to help to drive better performance and ROI. They found that just over half of the surveyed companies measured profitability by product, while a quarter were unable to analyse profitability, loyalty or sales at any level. The reasons for this must be manifold but undoubtedly, one of the contributory factors is that large companies are still unable to integrate front office systems with back office legacy data. There is a real need in the market today for middleware tools to allow the full flow of data across the organisation.
What CRM vendors should avoid is jumping on the “analytics” band wagon as if this should be an integral part of the CRM solution itself. Analytics is proving to be much more complex than simply adding on a business intelligence module. No supplier can provide a single solution that answers all of a company’s analytical needs. “One business intelligence tool does not fit all,” Gartner
Perhaps not surprisingly, many companies intend to invest in analytical software in the next 12 to 18 months. The Sybase survey also found that 93 per cent of companies identify profitability analysis as the key to the success of their CRM projects.
Do the solutions have to be so complex?
We are all aware that customers are very complex human beings and there seems to be an implication that the technology needs to be as complex in order to unravel this problem. There is the danger here that vendors are selling technology, rather than the solution. In general, the end user would prefer a straightforward and cost effective way of dealing with its customer base. Furthermore, they want a measurable return on the cost of the CRM solution in the first place.
On the other hand a solution that intuitively turns data into knowledge is not straightforward, so this is one of the challenges facing the vendor today.
What therefore should a CRM vendor do to stand out from the crowd?
- Understand the buyer:
What are the buyer’s business needs?
What are the buyer’s technology needs?
What benefits does your solution provide?
Which portion of the total solution is being offered?
What are the timescale expectations?
- Clearly articulate the value of your solution in solving the buyer’s problems
- Do not position your solution as the panacea for all problems.
- Aim to be the leader in a market:
Research the marketplace
Identify largely untapped markets – a vertical approach or going international
Find out where your USB might be beneficial
- Demonstrate real solutions and not technology
- Be aware of future trends
The emphasis today is no longer on getting a product to market, but on providing the solutions that the customer needs. |
