I am a shopper. That’s an understatement. I buy from a lot of companies, from their stores, web sites, direct mail and catalogs and very few of them do anything but take my money and deliver the goods. They almost never make the extra effort to develop a relationship with me or, as Ford Motor Co. puts it, “surprise and delight” me in any way.
I’d want to keep me, as a customer.
Why should they want to build a relationship? For starters, it’ll help them keep me as a customer, and if they keep customers, they won’t have to spend as much time and money acquiring new ones. When you think about the lifetime value (LTV) of a single good customer, it’s a wonder more companies don’t bend over backwards to keep customers happy.
Customers may defect.
When I talk to clients about CRM, the objection is usually: “Why should we spend money on current customers? They’re already buying from us.” Here’s why: If you don’t offer your customers something special—something that’s of real value, that’s relevant—when another company does make that offer, they’ll leave you.
I’m loyal to 1800 CONTACTS, because I buy my lenses from them and my lens solution too. Sometimes I go to the eye doctor and he changes their strength so I call them and they send me the new ones, and give me a credit for the ones I haven’t used.
They keep in touch with me by email, and their customer service people are very nice. I won’t try another company, because they’re great. Plus I’ve recommended about 6 other people to them also, talk about them in my speeches too.
CRM is not about the software or some million-dollar technology. It must start with looking at needs, specifically what customers need.
Recently I ordered pantyhose, and I got an e-mail confirmation almost immediately. Sure, it’s a step in the right direction, but it’s just the first step. When it comes to communicating with customers across channels, there are many disconnects. It seems that the technology still isn’t smart enough. Most business owners who have been around a while seem to be smarter than the smartest technology, better at offering customers what they want and showing customers how much they value them. Some of the challenges we face include:
1. There are few loyalty clubs in multichannel environments, but unifying loyalty programs across channels should be a big deal. American Express and other companies work to deliver this for their best customers.
2. I believe CRM will work. Often it seems that interactions have occurred in silos. When and if you create meaningful conversations through flexible systems that bridge different environments, you’ll be effective.
3. Companies such as Amazon.com, eBags.com, 1800CONTACTS, even Netflix use CRM to meet and anticipate customer needs, and are leading the way. Software itself can accomplish many things. It can make business move faster and help you see relationships you might have missed. It can remind you to follow up. But too many companies are asking technology to do the one thing it really can’t do: manage a relationship.
CRM has a chance of working once companies recognize that it doesn’t exist separately from the business strategies and processes of a company. Success requires planning, and a rush to adopt technology without strategy is dangerous. Software is only a means to an end. For CRM to succeed, there must be a strategy in place that makes sense. And there must be people in place who have direct marketing sensibilities.
I hope one day a bank will have a great program in place (but that’s for a whole other blog post).
I dream that one day when I buy from nearly any retail store, I’ll also be given information about service online. I’ll be able to buy from a store and return the item to a central distribution center and get credit on my card. I’ll even get appropriate offers based on prior purchases and preferences. A company will thank me for my purchases—recognize me when I call. And it will know when I’ve defected and invite me to come back. Then I will be a loyal customer forever.