Companies hoping to transform their business into a customer-centric organization need to view customer service not as an event but as a series of interconnected processes, and to make their IT plans accordingly, according to one Gartner analyst.
Customer service progresses through six phases: detection, preparation, transaction, measurement, understanding and improvement, according to a recent research note written by Michael Maoz, vice president and distinguished analyst with the Stamford, Conn.-based research firm. Having someone, or better yet a team of people, take the perspective of customers and their progression through these processes is a difficult but rewarding endeavor.
In fact, the customer experience is beginning to replace CRM in many places. AMR Research, for example, no longer has a CRM research group but studies customer management, and vendors are beginning to position themselves as providing customer experience management technology.
"CRM has been kicked and tossed and beaten; customer experience seems to have better resonance," Maoz said. "You can manage to sub-optimize any one piece of a series of processes and still get it all wrong. What this is talking about is let's look at it a little more from the customer's experience. Let's see how they consider the overall set of experiences."
Companies have been optimizing individual customer contact channels for years and have become adept at serving their customers individually. A customer may get good service on a Web site, then a chat session and finally a phone call, but if he has to repeat information and gets different responses at each channel, the overall experience is broken, Maoz said.
Part of the problem is that segments of the organization have taken responsibility for individual channels. The answer, Maoz suggests, is to form a team focused on the customer that touches all the parts of the organization that a customer touches -- billing, marketing, logistics, call center, partners.
"By taking a holistic approach and creating a customer experience team, you can begin looking at what a customer expects and compare it to a nonlinear or broken set of processes from the inside," Maoz said. "The idea is to change the way organizations are structured."
Another vital part of the customer experience team? Customers. Companies no longer need to rely on focus groups, surveys or follow-up calls. Particularly with large, business-to-consumer organizations, online communities with the participation of the business are providing real insight into processes and performance, he said. Companies such as Hallmark, CharlesSchwabb and HP -- with PhotoSpace, its online community of photo-taking moms -- are doing this right, according to Maoz.
But though the team is important and the concept solid, he said, it takes more than just assembling a group. It needs leadership, and that doesn't necessarily mean giving someone an empty title of chief customer officer.
"If you don't have C-level approval and budget -- meaning [that] you're being measured on it, given a bonus on it, your salary is measured on it -- then it's just lip service," Maoz said. "Generally, someone at the top says, 'Enough talk about this customer experience, our marketing is failing us.'"
It's a vital step because learning from customers and changing processes to serve them means more time and money -- a departure from the traditional focus on efficiencies and quarterly profits.
"You'd be a fool to try and change customer processes at the expense of higher service costs unless you have someone with higher authority," Maoz said.
For many organizations, IT has done as much as it can to optimize channels and purchase hardware and software. When the CFO and CTO of a company get together and decide to put an end to thinking of service as an event, things change.
And things are changing. Companies with lots of customer touch points are evolving to this, Maoz said -- investment banks in particular. Telecoms selling packages instead of bundled minutes, insurance companies, service companies and hotel chains are all getting into it, though it's far from widespread adoption.
"If you look at all businesses, maybe three to five percent truly are engaged in trying to improve the customer experience from a holistic experience," Maoz said. "Most other companies are far away from that."
Sunday, December 17, 2017
Sunday, July 5, 2009
Feedback That Works
Fundamentally, feedback is a good thing. For managers, it's an important tool for shaping behaviors and fostering learning that will drive better performance. For their direct reports, it's an opportunity for development and career growth.
Why, then, is it so problematic? Most managers say they dislike giving feedback and don't think it's as effective as it could be. Those on the receiving end say they don't get enough feedback they can actually use.
Many reasons account for this disconnect. Strong emotions on both sides, a focus on character rather than on behavior, and a lack of clarity about what needs to change and why are just a few of the factors that can undermine a feedback session, write Mark D. Cannon and Robert Witherspoon in an Academy of Management Executive article. What can a manager do to improve feedback?
Focus on business outcomes
Business outcomes should be your starting place for giving feedback: You need to develop talent, boost sales, improve service. When feedback is framed as a means to reach a specific business goal, it becomes an opportunity to solve a problem rather than criticize.
This opportunity is not geared only to the manager. When feedback is focused on the employee's development, "that makes it a lot more helpful," says Cannon, a professor of leadership and organizational studies at Vanderbilt University, in Nashville. "Feedback becomes a gift of someone investing in the recipient's career."
Give feedback often
Feedback works best when it's a continual process rather than a formal session once or twice a year. In fact, experts agree that the yearly performance appraisal is the worst time to surprise an employee with negative feedback. You're nervous, and so is the employee. With pulse rates up and adrenaline flowing, the natural response is fight or flight, not the thoughtfulness an effective feedback session requires.
Practice giving feedback often; soon it will become a habit. Praise good performance right away. When negative feedback is required, talk with the employee within 24 hours.
If you've managed your direct reports for a while, you've drawn conclusions about them. That's fine, but don't let these conclusions lead you astray in a feedback session, write Cannon and Witherspoon. For instance, saying something like "You're unprofessional" is a recipe for disaster. A character attack provides no information and doesn't offer any actionable ideas for change.
Before a feedback session, find concrete data that may or may not support your conclusions. Your goal is to gather evidence that will allow you to describe:
Specific behavior. Be specific about what the person has done or not done, without judging her intent. Avoid statements that begin "You always. . ." or "You never. . ." The impact of that behavior. Tell the person how her behavior is affecting you, the team, or the business. What you want the person to do differently. Your employee can't read your mind. Be explicit about what needs to change. Don't assume you're right
Even after you've collected your data, you might not have the complete picture. Other people may not see this person's behavior as you do. Furthermore, the employee will have his own side of the story. "Difficult feedback is rarely about getting the facts right," says Witherspoon, an executive coach and president of Washington, D.C.-based Performance & Leadership Development Ltd. "It's about conflicting views, feelings, and values. Reasonable people differ about all these things."
Approach the feedback session with the goal of getting a complete and accurate picture of the situation. Just as you want your employee to listen with a willingness to be influenced by what he hears, you need to be willing to be influenced by what you hear.
Ask questions
To make this a learning conversation for both you and your employee, ask questions to get her thinking:
How do you see the situation?
How might you do things differently next time?
What do you think worked, and what could have gone better?
Questions like these establish a supportive atmosphere in which the employee can explore alternative approaches that might produce better results. The more an individual thinks about improving her performance, says Cannon, "the more committed she is to making it happen."
Follow through
Because managers dread giving feedback, they like to feel that once they've had the conversation, they're done. Not so fast! says Cannon. "There is a big difference between understanding and changing," he says. Your employees' ability to make that leap requires ongoing support. Thus, follow-through is vital. Ask, "Now what are the next steps you will take, and how can I support your progress?" Plan to meet again in a month.
Consider yourself a catalyst for the change you'd like to see. Suggest specific steps that will help the employee work on performance gaps. Cannon recommends having him gather his own data by asking peers or subordinates for feedback and suggestions on a particular performance area.
Gather feedback on how you give feedback
Is giving feedback an area in which you need to improve? At the end of a feedback session, ask what your employee thought of the conversation and how you can be more helpful.
Why, then, is it so problematic? Most managers say they dislike giving feedback and don't think it's as effective as it could be. Those on the receiving end say they don't get enough feedback they can actually use.
Many reasons account for this disconnect. Strong emotions on both sides, a focus on character rather than on behavior, and a lack of clarity about what needs to change and why are just a few of the factors that can undermine a feedback session, write Mark D. Cannon and Robert Witherspoon in an Academy of Management Executive article. What can a manager do to improve feedback?
Focus on business outcomes
Business outcomes should be your starting place for giving feedback: You need to develop talent, boost sales, improve service. When feedback is framed as a means to reach a specific business goal, it becomes an opportunity to solve a problem rather than criticize.
This opportunity is not geared only to the manager. When feedback is focused on the employee's development, "that makes it a lot more helpful," says Cannon, a professor of leadership and organizational studies at Vanderbilt University, in Nashville. "Feedback becomes a gift of someone investing in the recipient's career."
Give feedback often
Feedback works best when it's a continual process rather than a formal session once or twice a year. In fact, experts agree that the yearly performance appraisal is the worst time to surprise an employee with negative feedback. You're nervous, and so is the employee. With pulse rates up and adrenaline flowing, the natural response is fight or flight, not the thoughtfulness an effective feedback session requires.
Practice giving feedback often; soon it will become a habit. Praise good performance right away. When negative feedback is required, talk with the employee within 24 hours.
If you've managed your direct reports for a while, you've drawn conclusions about them. That's fine, but don't let these conclusions lead you astray in a feedback session, write Cannon and Witherspoon. For instance, saying something like "You're unprofessional" is a recipe for disaster. A character attack provides no information and doesn't offer any actionable ideas for change.
Before a feedback session, find concrete data that may or may not support your conclusions. Your goal is to gather evidence that will allow you to describe:
Specific behavior. Be specific about what the person has done or not done, without judging her intent. Avoid statements that begin "You always. . ." or "You never. . ." The impact of that behavior. Tell the person how her behavior is affecting you, the team, or the business. What you want the person to do differently. Your employee can't read your mind. Be explicit about what needs to change. Don't assume you're right
Even after you've collected your data, you might not have the complete picture. Other people may not see this person's behavior as you do. Furthermore, the employee will have his own side of the story. "Difficult feedback is rarely about getting the facts right," says Witherspoon, an executive coach and president of Washington, D.C.-based Performance & Leadership Development Ltd. "It's about conflicting views, feelings, and values. Reasonable people differ about all these things."
Approach the feedback session with the goal of getting a complete and accurate picture of the situation. Just as you want your employee to listen with a willingness to be influenced by what he hears, you need to be willing to be influenced by what you hear.
Ask questions
To make this a learning conversation for both you and your employee, ask questions to get her thinking:
How do you see the situation?
How might you do things differently next time?
What do you think worked, and what could have gone better?
Questions like these establish a supportive atmosphere in which the employee can explore alternative approaches that might produce better results. The more an individual thinks about improving her performance, says Cannon, "the more committed she is to making it happen."
Follow through
Because managers dread giving feedback, they like to feel that once they've had the conversation, they're done. Not so fast! says Cannon. "There is a big difference between understanding and changing," he says. Your employees' ability to make that leap requires ongoing support. Thus, follow-through is vital. Ask, "Now what are the next steps you will take, and how can I support your progress?" Plan to meet again in a month.
Consider yourself a catalyst for the change you'd like to see. Suggest specific steps that will help the employee work on performance gaps. Cannon recommends having him gather his own data by asking peers or subordinates for feedback and suggestions on a particular performance area.
Gather feedback on how you give feedback
Is giving feedback an area in which you need to improve? At the end of a feedback session, ask what your employee thought of the conversation and how you can be more helpful.
Tuesday, April 7, 2009
Cash in the Attic: Unlocking Customer Value with CRM Technology
Apr. 03, 2009
By Richard Boardman, Mareeba CRM Consulting
For a long time, the dowdy and somewhat overlooked sister to the rather more glamorous new business sale; the development of existing customers?or
account management as it's generally known?has suddenly become rather more attractive. With new business opportunities harder to come by for many
companies selling business to business, and with increased competition driving down margins, many firms are finding their existing customers are the
"cash in the attic" they need to take them through the current down turn.
Selling more to your existing customers has a number of virtues: as an established supplier, sales cycles are generally shorter, competitive
pressures are less and margins are higher.
For a few businesses, like funeral homes perhaps, the scope for repeat business might be a little limited, but for most there's potential to either
sell more of what customers have already, or add other products and services. Selling more to your existing customers has a number of virtues: as an
established supplier, sales cycles are generally shorter, competitive pressures are less and margins are higher. Which is why, as independent CRM
consultants, we're seeing sharp growth in companies looking to be more systematic in maximizing customer potential and using CRM technology to
support it. The following are some of the simple ways firms are doing it:
Understanding Who Has What
While it might sound obvious, for many companies understanding who has what products or services is a challenge. It's not that the information isn't
there necessarily, it's just not readily available to those that need it: the sales and marketing teams. We worked with a manufacturer of printing
equipment whose customer data was spread across three separate databases and was unusable from a sales and marketing perspective. By consolidating
the data into the CRM system the client was able to identify customers who owned older models of equipment, and was able initiate a highly successful
marketing campaign aimed at upgrading them to newer, more cost effective machines. The investment in the supporting CRM technology was paid off in
three months.
While this example may sound extreme, we've seen variations on this theme time and time again, so for many companies making this information readily
available can be a quick and simple way of growing sales.
Understand the Customer Potential
Not all customers are equal, some have the potential for growth and some do not. The key to growing business from the customer base is to align
effort with potential, which is something that rarely occurs without a systematic approach.
As an example, we recently worked with a client whose products were sold through a reseller channel. When they mapped their sales volumes as a
percentage of each reseller's overall sales, they were surprised to find that many supposedly "minor" accounts were actually selling huge volumes,
but of their competitor's products. Even more disturbingly, when they overlaid where their sales team were spending their time, it was often with the
local or less demanding resellers rather than those who had the most growth potential. CRM technology can help companies gather the detailed
profiling data in order to more effectively assess customer potential, and having categorized the customer base appropriately, can be used to ensure
resources and potential remain aligned.
Plan
Yes, this sounds both obvious and dull, but for many companies the management of clients is entirely reactive to who shouts loudest rather than who
has greatest promise. A structured planning approach can be a highly effective way of generating business because it helps focus activities on the
areas of greatest opportunity.
We've seen one of the major financial services companies gain significant market share by embedding the planning process within their CRM system.
They've consistently caught their competitors napping by concentrating significant resources in a highly coordinated way on accounts they've
identified as having high strategic value. The CRM system very effectively supports the planning and sign off process itself, but has proved
particularly beneficial in providing visibility of agreed activities and progress to date. In effect technology avoids the fate of most planning
documents?permanent incarceration in a dusty filing cabinet?to become living, breathing tools for growth.
Develop a Contact Strategy
In the good times it's easy to be focus on winning new business rather than developing existing customers. I suspect we're all familiar with
suppliers to whom we've given business but haven't heard from again. To some extent this may be understandable because in many new markets there's a
limited window to "land-grab." However, for many suppliers this new business focus ends up being the equivalent of planting crops and not sticking
around for the harvest.
One simple way to balance this preoccupation is to determine a contact approach and frequency for each customer and manage it through the CRM system.
This helps develop the strength of relationship with the client and provides for a considerably more fertile environment for sales growth.
Increase the Range of Contacts and Market to Them
Recent work with a client revealed that while they had a wide range of products and services that appealed to many areas of their customer's
businesses, their salespeople tended to foster a small number, of mostly lower level contacts, in their customer base. This was significantly
restricting the growth of the business, as well as increasing customer attrition when these contacts moved on.
CRM technology can play a key role in helping ensure that salespeople extend the range and level of their customer contacts. In addition, by
integrating new communication channels such as telemarketing, customer service operatives, or email marketing, organizations can move from
communications that are restricted to the subjects the salesperson feels comfortable talking about to a much broader, more substantive dialogue with
key targets throughout the customer organization, with a view to substantially increasing the range of products and services sold.
While none of the above strategies are unduly sophisticated, for many businesses just getting these basics right can have a profound impact on a
company's performance. Over the years we've helped many companies significantly increase profitability through the more effective use of CRM
technology, and more effective account management and development strategies have provided some the highest pay-back areas. In today's business to
business sales environment, this may just be the difference between success and failure.
By Richard Boardman, Mareeba CRM Consulting
For a long time, the dowdy and somewhat overlooked sister to the rather more glamorous new business sale; the development of existing customers?or
account management as it's generally known?has suddenly become rather more attractive. With new business opportunities harder to come by for many
companies selling business to business, and with increased competition driving down margins, many firms are finding their existing customers are the
"cash in the attic" they need to take them through the current down turn.
Selling more to your existing customers has a number of virtues: as an established supplier, sales cycles are generally shorter, competitive
pressures are less and margins are higher.
For a few businesses, like funeral homes perhaps, the scope for repeat business might be a little limited, but for most there's potential to either
sell more of what customers have already, or add other products and services. Selling more to your existing customers has a number of virtues: as an
established supplier, sales cycles are generally shorter, competitive pressures are less and margins are higher. Which is why, as independent CRM
consultants, we're seeing sharp growth in companies looking to be more systematic in maximizing customer potential and using CRM technology to
support it. The following are some of the simple ways firms are doing it:
Understanding Who Has What
While it might sound obvious, for many companies understanding who has what products or services is a challenge. It's not that the information isn't
there necessarily, it's just not readily available to those that need it: the sales and marketing teams. We worked with a manufacturer of printing
equipment whose customer data was spread across three separate databases and was unusable from a sales and marketing perspective. By consolidating
the data into the CRM system the client was able to identify customers who owned older models of equipment, and was able initiate a highly successful
marketing campaign aimed at upgrading them to newer, more cost effective machines. The investment in the supporting CRM technology was paid off in
three months.
While this example may sound extreme, we've seen variations on this theme time and time again, so for many companies making this information readily
available can be a quick and simple way of growing sales.
Understand the Customer Potential
Not all customers are equal, some have the potential for growth and some do not. The key to growing business from the customer base is to align
effort with potential, which is something that rarely occurs without a systematic approach.
As an example, we recently worked with a client whose products were sold through a reseller channel. When they mapped their sales volumes as a
percentage of each reseller's overall sales, they were surprised to find that many supposedly "minor" accounts were actually selling huge volumes,
but of their competitor's products. Even more disturbingly, when they overlaid where their sales team were spending their time, it was often with the
local or less demanding resellers rather than those who had the most growth potential. CRM technology can help companies gather the detailed
profiling data in order to more effectively assess customer potential, and having categorized the customer base appropriately, can be used to ensure
resources and potential remain aligned.
Plan
Yes, this sounds both obvious and dull, but for many companies the management of clients is entirely reactive to who shouts loudest rather than who
has greatest promise. A structured planning approach can be a highly effective way of generating business because it helps focus activities on the
areas of greatest opportunity.
We've seen one of the major financial services companies gain significant market share by embedding the planning process within their CRM system.
They've consistently caught their competitors napping by concentrating significant resources in a highly coordinated way on accounts they've
identified as having high strategic value. The CRM system very effectively supports the planning and sign off process itself, but has proved
particularly beneficial in providing visibility of agreed activities and progress to date. In effect technology avoids the fate of most planning
documents?permanent incarceration in a dusty filing cabinet?to become living, breathing tools for growth.
Develop a Contact Strategy
In the good times it's easy to be focus on winning new business rather than developing existing customers. I suspect we're all familiar with
suppliers to whom we've given business but haven't heard from again. To some extent this may be understandable because in many new markets there's a
limited window to "land-grab." However, for many suppliers this new business focus ends up being the equivalent of planting crops and not sticking
around for the harvest.
One simple way to balance this preoccupation is to determine a contact approach and frequency for each customer and manage it through the CRM system.
This helps develop the strength of relationship with the client and provides for a considerably more fertile environment for sales growth.
Increase the Range of Contacts and Market to Them
Recent work with a client revealed that while they had a wide range of products and services that appealed to many areas of their customer's
businesses, their salespeople tended to foster a small number, of mostly lower level contacts, in their customer base. This was significantly
restricting the growth of the business, as well as increasing customer attrition when these contacts moved on.
CRM technology can play a key role in helping ensure that salespeople extend the range and level of their customer contacts. In addition, by
integrating new communication channels such as telemarketing, customer service operatives, or email marketing, organizations can move from
communications that are restricted to the subjects the salesperson feels comfortable talking about to a much broader, more substantive dialogue with
key targets throughout the customer organization, with a view to substantially increasing the range of products and services sold.
While none of the above strategies are unduly sophisticated, for many businesses just getting these basics right can have a profound impact on a
company's performance. Over the years we've helped many companies significantly increase profitability through the more effective use of CRM
technology, and more effective account management and development strategies have provided some the highest pay-back areas. In today's business to
business sales environment, this may just be the difference between success and failure.
Six Ideas for Next Generation CRM
By Graham Hill, Customers & More
I chaired the IIR Telecoms CRM, CEM and Retention conference in Berlin yesterday. It was a great day with some excellent speakers. Of all the
speakers, one stood out for me: Christian Magel, the Chief Marketing Officer of low-cost mobile telco Simyo in Germany.
Simyo is a relatively recent entrant in the crowded German mobile telecoms market. It provides a simple, no-frills voice, SMS and data proposition to
cost-conscious customers. But that doesn’t mean that its customers don’t have any affinity for Simyo. On the contrary, it has a much, much higher
proportion of brand advocates (as measured by the NPS score) than any of its much larger competitors. It is a real customer-centric company.
At the end of his presentation, Christian spoke about six guiding ideas for Next Generation CRM (with my own interpretation):
1. With the Internet, the Cost of Communications is Not the Issue - With the Internet, communications, whether they are voice-to-voice through a
VoIP service like Skype, interactive like IM, or direct like email, are all effectively free. The real issue isn’t the cost, but the relevance
of the communications to customers. If your communications are targeted, informative and timely, there is a good chance that customers will
appreciate them, and you for providing them. Indeed, youth mobile telco Blyk, that offers free mobile minutes and SMS in return for listening
to branded ads, found that many of its customers actually complained that they didn’t hear enough ads! This is quite a change from ‘maximum
contacts per period’ rules used by most data-intensive companies, that explicitly acknowledge that the communications are, at best, irrelevant
to customers, at worst, a damned nuisance!
2. Customer Loyalty Starts with Product Design - Loyalty shouldn’t happen by accident. It should be the natural response to explicitly designing,
products, services and experiences that help customers get everyday jobs done. This means really understanding customers' needs, in terms of
the jobs customers are trying to do and the outcomes they are trying to achieve, and how you can provide solutions that help customers. It also
means designing products that really deliver what customers’ expect, wrap-around services that add real value to the customer and knitting them
together so they deliver a superior end-to-end experience for the customer, particularly during that all important post-purchase, product usage
period where customers really get value from the products they bought.
3. Bad Products have No Chance on the Internet - Simyo is an internet-based mobile telco. If its products don’t work properly the first time,
customers will drop them immediately and tell all their facebook, twitter and calling community friends. In the same way we all quickly
back-track out of websites that don’t work, are too slow, or that don’t have any sticky content. That doesn’t mean that products on the
Internet have to be perfect or fully featured, but it does mean that they have to meet the customers’ core needs from the start. And at a
suitable price point. This provides a great opportunity for disruptive innovators like Simyo, who provide products that meet customers core
mobile telephony needs, without all the expensive, unused frills of traditional providers, at a rock-bottom price. Evolving and additional
customer needs can be met later through a process of continuous innovation, in a similar way that companies like Google do.
4. It’s Not the Product, It’s the Customer - Most telcos and indeed, most companies, are still product-centric. Their annual report may say how
customer-centric they are, but in reality, their whole world revolves around making better products and then trying to find customers to buy
them. There is no wonder that 80% of their products fail on market entry and 60% fail on re-entry. In contrast to this, Simyo has built its
business around understanding its customers’ needs, provides products, services and an experience that exactly matches them, and then
delivering them to customers at a profit. By delivering value to its customers throughout the customer experience, Simyo has earned the right
to be paid handsomely by them for doing so. Customer-centric business starts and ends with customers.
5. Don’t Stop with Loyalty, Evangelists can Achieve Much More - Customer satisfaction, retention and loyalty, and their relationship to
profitability have been agued over for decades. But even emotionally committed, loyal customers arean’t enough. Not today. Companies need to
provide enough value to customers so that they want to tell everyone else about it. The old saying was that a happy customer told five friends
about it, on the Internet, they can tell 5,000 or even 5,000,000. And as research by Kumar on Customer Referral Value has shown, talkative
customers can have a value to the company through their referrals of up to four times the value of their own purchases.
6. Crowdsource your Best Ideas from your Customers - Experts in innovation like MIT’s Eric von Hippel, estimate that up to 80% of successful
innovations originate from customers. The challenge is in tapping into the right customers to see how they are using your products, those of
competitors or a mash-up of different products to get important jobs done. Approaches like crowdsourcing, open innovation and lead-user
innovation all provide a way to look outside your own company and to bring in winning innovations from outside. In Simyo’s case, they have
hired hundreds of Simyo Paten who crowdsource answers to customers questions. With response times to email questions in hours rather than the
more normal days, this is just one way to harness the wisdom of the crowd.
Christian’s six guiding ideas provide a great framework to think about Next Generation CRM. They encompass much of what is in Paul Greenberg’s CRM
2.0 yet go much further at the same time. Take a look at how you stack-up against them. And where you must do better if you are to build brand
advocacy in your customers like Simyo has.
You can follow Christian and the Simyo team at the Simyo blog.
With great thanks to Christian for his stimulating presentation in Berlin.
Graham Hill
Customer-driven Innovator
Follow me on Twitter
Interested in Customer Driven Innovation? Join the Customer Driven Innovation groups on LinkedIn or Facebook to learn more.
I chaired the IIR Telecoms CRM, CEM and Retention conference in Berlin yesterday. It was a great day with some excellent speakers. Of all the
speakers, one stood out for me: Christian Magel, the Chief Marketing Officer of low-cost mobile telco Simyo in Germany.
Simyo is a relatively recent entrant in the crowded German mobile telecoms market. It provides a simple, no-frills voice, SMS and data proposition to
cost-conscious customers. But that doesn’t mean that its customers don’t have any affinity for Simyo. On the contrary, it has a much, much higher
proportion of brand advocates (as measured by the NPS score) than any of its much larger competitors. It is a real customer-centric company.
At the end of his presentation, Christian spoke about six guiding ideas for Next Generation CRM (with my own interpretation):
1. With the Internet, the Cost of Communications is Not the Issue - With the Internet, communications, whether they are voice-to-voice through a
VoIP service like Skype, interactive like IM, or direct like email, are all effectively free. The real issue isn’t the cost, but the relevance
of the communications to customers. If your communications are targeted, informative and timely, there is a good chance that customers will
appreciate them, and you for providing them. Indeed, youth mobile telco Blyk, that offers free mobile minutes and SMS in return for listening
to branded ads, found that many of its customers actually complained that they didn’t hear enough ads! This is quite a change from ‘maximum
contacts per period’ rules used by most data-intensive companies, that explicitly acknowledge that the communications are, at best, irrelevant
to customers, at worst, a damned nuisance!
2. Customer Loyalty Starts with Product Design - Loyalty shouldn’t happen by accident. It should be the natural response to explicitly designing,
products, services and experiences that help customers get everyday jobs done. This means really understanding customers' needs, in terms of
the jobs customers are trying to do and the outcomes they are trying to achieve, and how you can provide solutions that help customers. It also
means designing products that really deliver what customers’ expect, wrap-around services that add real value to the customer and knitting them
together so they deliver a superior end-to-end experience for the customer, particularly during that all important post-purchase, product usage
period where customers really get value from the products they bought.
3. Bad Products have No Chance on the Internet - Simyo is an internet-based mobile telco. If its products don’t work properly the first time,
customers will drop them immediately and tell all their facebook, twitter and calling community friends. In the same way we all quickly
back-track out of websites that don’t work, are too slow, or that don’t have any sticky content. That doesn’t mean that products on the
Internet have to be perfect or fully featured, but it does mean that they have to meet the customers’ core needs from the start. And at a
suitable price point. This provides a great opportunity for disruptive innovators like Simyo, who provide products that meet customers core
mobile telephony needs, without all the expensive, unused frills of traditional providers, at a rock-bottom price. Evolving and additional
customer needs can be met later through a process of continuous innovation, in a similar way that companies like Google do.
4. It’s Not the Product, It’s the Customer - Most telcos and indeed, most companies, are still product-centric. Their annual report may say how
customer-centric they are, but in reality, their whole world revolves around making better products and then trying to find customers to buy
them. There is no wonder that 80% of their products fail on market entry and 60% fail on re-entry. In contrast to this, Simyo has built its
business around understanding its customers’ needs, provides products, services and an experience that exactly matches them, and then
delivering them to customers at a profit. By delivering value to its customers throughout the customer experience, Simyo has earned the right
to be paid handsomely by them for doing so. Customer-centric business starts and ends with customers.
5. Don’t Stop with Loyalty, Evangelists can Achieve Much More - Customer satisfaction, retention and loyalty, and their relationship to
profitability have been agued over for decades. But even emotionally committed, loyal customers arean’t enough. Not today. Companies need to
provide enough value to customers so that they want to tell everyone else about it. The old saying was that a happy customer told five friends
about it, on the Internet, they can tell 5,000 or even 5,000,000. And as research by Kumar on Customer Referral Value has shown, talkative
customers can have a value to the company through their referrals of up to four times the value of their own purchases.
6. Crowdsource your Best Ideas from your Customers - Experts in innovation like MIT’s Eric von Hippel, estimate that up to 80% of successful
innovations originate from customers. The challenge is in tapping into the right customers to see how they are using your products, those of
competitors or a mash-up of different products to get important jobs done. Approaches like crowdsourcing, open innovation and lead-user
innovation all provide a way to look outside your own company and to bring in winning innovations from outside. In Simyo’s case, they have
hired hundreds of Simyo Paten who crowdsource answers to customers questions. With response times to email questions in hours rather than the
more normal days, this is just one way to harness the wisdom of the crowd.
Christian’s six guiding ideas provide a great framework to think about Next Generation CRM. They encompass much of what is in Paul Greenberg’s CRM
2.0 yet go much further at the same time. Take a look at how you stack-up against them. And where you must do better if you are to build brand
advocacy in your customers like Simyo has.
You can follow Christian and the Simyo team at the Simyo blog.
With great thanks to Christian for his stimulating presentation in Berlin.
Graham Hill
Customer-driven Innovator
Follow me on Twitter
Interested in Customer Driven Innovation? Join the Customer Driven Innovation groups on LinkedIn or Facebook to learn more.
Wednesday, November 5, 2008
SAS Enables Customer-Centric Marketing Communication for HF Holidays
LONDON, Oct 28, 2008 (BUSINESS WIRE) -- World leading walking and cycling holiday specialists, HF Holidays, has chosen SAS(R) Marketing Automationsoftware as the foundation for improving its marketing communications. SAS' customer-centric marketing software will enable HF Holidays to create better targeted direct mail campaigns and e-newsletter offers to its customers, based on accurate customer data. Using SAS, the company aims to accelerate growth by an additional 5-10 percent within the next 5 years through better targeted mailings.
HF Holidays turned to SAS for a more powerful and sophisticated customer profiling system to improve targeting and personalisation of its marketing communications. SAS, the leader in business analytics, will provide HF Holidays with comprehensive data management, campaign management and advanced customer analytics in one integrated solution.
SAS will integrate data from several separate databases within HF Holidays, significantly improving the quality and accuracy of its customer information. This centralised platform will enable the company to generate accurately targeted campaigns, as well as understand and track customer responses and campaign success, whilst saving time and increasing efficiency.
Aimee Hart, Communications Manager at HF Holidays states: "SAS' complete marketing solution will provide us with a holistic approach to marketing to our customers. With SAS we will be able understand all of our customer data and gather insight into their behaviour. We believe that our marketing campaigns will be more accurate, efficient and successful."
Ian Manocha, Managing Director of SAS UK, states: "The leisure industry is a real growth area for SAS. We have recently expanded our footprint in this market by acquiring IDeaS Revenue Optimisation and forming a new Profit Optimisation Global Practice, showing that we take this market incredibly seriously. It is highly competitive with a diverse customer base; holiday companies need technology that provides the best way of communicating with customers to lift them above the competition. SAS software has proved it can do just that."
SAS' software is currently being installed by consulting partner, Ellion Insight, the travel technology firm. Ellion Insight is providing the analysis, project management and implementation of the system.
http://www.marketwatch.com/news/story/SAS-Enables-Customer-Centric-Marketing/story.aspx?guid=%7B9ADCC428-98BF-4C88-927C-07C25E00A878%7D
HF Holidays turned to SAS for a more powerful and sophisticated customer profiling system to improve targeting and personalisation of its marketing communications. SAS, the leader in business analytics, will provide HF Holidays with comprehensive data management, campaign management and advanced customer analytics in one integrated solution.
SAS will integrate data from several separate databases within HF Holidays, significantly improving the quality and accuracy of its customer information. This centralised platform will enable the company to generate accurately targeted campaigns, as well as understand and track customer responses and campaign success, whilst saving time and increasing efficiency.
Aimee Hart, Communications Manager at HF Holidays states: "SAS' complete marketing solution will provide us with a holistic approach to marketing to our customers. With SAS we will be able understand all of our customer data and gather insight into their behaviour. We believe that our marketing campaigns will be more accurate, efficient and successful."
Ian Manocha, Managing Director of SAS UK, states: "The leisure industry is a real growth area for SAS. We have recently expanded our footprint in this market by acquiring IDeaS Revenue Optimisation and forming a new Profit Optimisation Global Practice, showing that we take this market incredibly seriously. It is highly competitive with a diverse customer base; holiday companies need technology that provides the best way of communicating with customers to lift them above the competition. SAS software has proved it can do just that."
SAS' software is currently being installed by consulting partner, Ellion Insight, the travel technology firm. Ellion Insight is providing the analysis, project management and implementation of the system.
http://www.marketwatch.com/news/story/SAS-Enables-Customer-Centric-Marketing/story.aspx?guid=%7B9ADCC428-98BF-4C88-927C-07C25E00A878%7D
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