CRM is dead! Yeah, right – and Earth is a disc

wooden_figurseA few days ago I came across a blog entry by @MikeBoysen titled Customers Don”t Want Relationships…PERIOD!

A really intriguing title and read – perhaps written to stir up a discussion. Works for me, as it stirs me up from of my absence from this blog of mine…

Mike, after this very strong claim the starts with another one: CRM is dead.

Well, CRM seems to be pretty alive for a dead one; as a strategy and also as a technology. And here is exactly the point where Mike and other influencers – I had discussions about this topic e.g. with @bob_thompson from CustomerThink as well – are dead wrong (I couldn’t resist this pun). Their argumentation is solely based upon CRM being a technology. And then they compare CRM with another acronym that they claim is a strategy, concluding that the other one is far better. Apples vs. pears. Technology vs strategy.

CRM is not a technology. It is also not a process area.

CRM is a strategy.

CEM is another, related, strategy.

Buying a technology without a strategy to implement is bound to fail. It is like entering a road without a destination in mind. This holds true for whatever acronym is used, including CRM, SCRM, or CEM, but also “Loyalty Management”, or “Social Media”, or “Big Data”. What do I need “Big Data” for? Or what is the purpose of doing “Social Media” in an enterprise context? Are customers loyal to a vendor or does a vendor simply manage to create the impression that he is better able to deliver to customers’ needs than other vendors?

“Big Data” mitigates our inability to know about what and how to collect and analyze data beforehand and thus enables us to decide faster and better based upon data. It is nothing without a strong ability to analyze data in order to prove or disprove hypotheses, to find the needle in the haystack. “Social Media” is a way of using more and other communication channels to interact with prospects and customers. And yes, it overlaps with “Big Data”. It also overlaps with “CRM” and “CEM”, and “Loyalty Management”.

“Loyalty Management” is a strategy to bind customers to a vendor. It will not work without delivery on promise and thus not without supporting CRM and CEM strategies. I would even go as far as saying that implementing a CRM strategy involves customer experience management, CEM.

The reasons for pursuing these (and other) strategies and implementing the corresponding processes and technologies should be the same (and I deliberately do not say “IS”): Increase the measurable success of the enterprise according to its key performance indicators by implementing a strategy using one or more technologies.

And, by the way: All these strategies are targeted towards customers getting involved into a relationship, whether they want a relationship or not; customers also might not perceive it as a relationship.

What is a relationship? There are at least two useful definitions that one retrieves googling “define:relationship”:

• “The way in which two or more people or things are connected, or the state of being connected”

• “The way in which two or more people or groups regard and behave towards each other”

Can we measure this? I think, yes; starting with simple behavioural metrics like RFM, (email-) subscriptions, opening rates, forwarding rates, campaign reactions – it tells a lot if a customer only buys the deals – but also using surveys, customer satisfaction scores including the not-so-liked net promoter score. Add into the mix the participation in forums and statements on social media, like Instagram, Facebook, Twitter and the willingness to give away personal data (in return for better targeted offers or better prices, or…?) and the ever-increasing ability to perform sentiment analysis on what we are saying and writing.

This, together with a customer-oriented approach of delivering solutions to needs, and adapting over time, helps customers and thus the business.

Having said this CRM is by no means the only customer oriented strategy that businesses need to look at. The best solutions are of no or low value if the experience is not right – maybe a bad example here, but think of the perception that SAP is still struggling with.

tl;dr CRM is a strategy and is far from dead; customer relationships are measurable and whether we as customers like it or not, we are in a relationship with vendors. Vendors, on the other hand, cannot rely on systems as a panacea: They need to implement a set of customer oriented strategies including relationship management and experience management in order to be able to repeatedly help customers getting their job done (provide a solution to their problem).