Is Customer Engagement and Experience the new CRM?
I am currently traveling on our ISIS Papyrus Roadshow 2013. The theme of our event series – as well as my keynote – is ‘Customer Engagement and Experience’. It was therefore sensible to include an intermediate stop at the Gartner Group Customer Strategies & Technologies Summit in London.
The core theme of the event was ‘Understand. Engage. Deliver: Earning Customers for Life.’ That fits extremely well with the subject of our 2013 event series that focuses on Customer Engagement. Understand is meant to cover ways to know what customers want. Engage relates to customer interactions. Deliver covers the means to actually perform the services that improve customer satisfaction and drive up loyalty. I could not agree more.
The event was well attended and organized. While talking to many prospects at the show floor I did also attend a number of presentations, of which unforunately some left me dissatisfied. I found there was still a lot of talk about advertizing, targeted marketing, lead and sales management and some new themes related to Social media. Yup, they just gave CRM a new name.
The list of subjects was grouped into:
- Social and Mobile CRM
- Single View of the Customer
- “Big Data” and Customer Analytics
- Differentiated Customer Experiences
- The Future of CRM
In principle the theme of the summit was to the point, but I was not satisfied what the various presentations and also vendors on the show floor delivered. I am not complaining at all but I am wondering. Is the real problem of the current lack of customer orientation in large businesses related to new marketing channels and a shift to Social power? Is it the new complexity of Social and Mobile that are forcing organizations to rethink how they manage customer relationships? I honestly do not think so. The problem is the cost-cutting mindset in customer service that is still prevalent.
The keynote was held jointly by Gene Alvarez, Jim Davies and Ed Thompson introducing the segmentation of Understand, Engage, Deliver. They basically covered customer data collection, call centers, and data analytics. As future trends they presented Social, Mobile and Big Data which all will change the way customers interact with businesses. The most interesting chart was one in which they presented a survey in which executives had to judge their approach in relationship to innovation. Only 10 percent said that they wanted to be the first ones to try something new. The rest were split evenly between early adopters, mainstream users, or laggards. This coincides with my experience. It simply means that we as an innovator have only 10% of the market to sell to. That was a tough realization and explains why we have always only grown moderately.
While there is nothing wrong with rethinking CRM initiatives in the light of Gartner Group’s value model of vision, strategy, customer experience, organizational collaboration, processes, information, metrics and technology, in the end it all depends on what businesses actually do in front of their customers. And I have not found much at this event that actually improves customer interaction. They all just focused on how to gather more data about the customer and what one can do without talking to the customer.
Customer engagement without customer communication?
I propose that this mismatch relates to the survey model of analyst companies. They survey what a host of vendors are offering and then assume that this is what businesses actually need. They are buying it, so therefore it must be what they need. As it happens, these markets are skewed by the amount of money that the mega-vendors pump into advertizing and yes, into analysts. Behind all this there is no conspiracy theory or immoral behavior as analysts do nothing else than to follow the money trail and that means they have to look at the past only. We are often excluded from analyst reports simply because we are not ‘relevant in market share’ and therefore not of interest to their report buyers. I think you should really be aware of this.
Gartner does say that CRM is not about installing a piece of software but about changing to a customer-centric approach. My wording in the last ten years was: ‘A database won’t improve your relationships, only communication does.’ Gartner suggests that cultural changes are a key element and that coincides with the same recommendation for doing BPM properly. I am sorry, but I disagree again. Enabling technology comes first and then the culture can actually change. No one asked one billion people around the world to change their culture to buy iPhones or to go onto Facebook. It was the technology that drove change.
The problem lies in what the CRM software actually does and how it empowers people to turn towards the customer. I saw no such solutions at the summit. The only consumer-facing functions were about how to collect data from Web, Social and Mobile applications and not about how employees would more effectively interact with their customers. To do this doesn’t require ‘smart process apps’ that are way too limited, but the ability to create ACM adaptive processes from pre-defined and ad-hoc goals and human interactions.
Enterprises do not really do business via Social or Mobile apart from maybe Internet banking. The majority of transactions are still via paper. E-commerce is still a single digit marketshare, but Amazon is the largest retailer in the world. The majority of customer service interactions are via phone or email and to a growing percentage via Web. Also here no Social networks. As long as businesses want to use the new technologies to reduce cost and not to actually improve the service quality not much will change. Web and Mobile do not improve customer loyalty because they lack the emotional interaction.
There are two subjects that I will discuss in my next post, which are ‘Single View of the customer’ and ‘Voice of the Customer’ that were prominently covered at the summit and left me disappointed. All that is not Gartner Group’s fault as it is simply the way the markets work. I did rant a little about the purely artificial ‘Smart Process Apps’ market segment created by Forrester Research but I am aware that it is in the interest of all involved (bewildered buyers, pushy vendors and analysts) to play this game.
In my next post I will continue the coverage of ‘CRM’s new clothes’.