Customers left out of most CRM projects, says exec

TORONTO — There still isn’t enough C in CRM.

There are many definitions of what customer relationship management (CRM) means to an enterprise, but the most important part of the common industry acronym must always be the C, said Cap Gemini Ernst & Young Canada‘s Barry Rivelis.

Rivelis, vice-president of CRM and e-business, spoke to industry professionals about the importance of customers during a seminar at the CRM Power 2001 conference in Toronto on Wednesday.

CGEY and Gartner Inc. attempted to plot about 300 North American companies on a CRM index last fall, ranging from “basic transactors” to “customer satisfiers” to “relationship optimizers.” The categories work best depending on the type of organization, said Rivelis. For instance, the Gap may be a “customer satisfier” since it sells a large volume of relatively inexpensive apparel. Harry Rosen is a “relationship optimizer” because it sells expensive, sometimes tailored, clothing to a smaller customer base. A major soft drink company that consults with CGEY is a “basic transactor” whereas Marriott hotels, another CGEY client, is a “relationship optimizer.”

According to the CRM index, most companies tend to be “customer satisfiers” — 81 per cent of high tech companies, for example, fell into this category, as did 76 per cent of financial services and 64 per cent of telecommunications providers. But according to Rivelis, more companies are interested in making a “transformation from managing the customer relationship to managing the customer experience.” In other words, putting the C back in CRM.

In a time where corporate budgets are stretched and companies are trying to do more with less money, it’s important for a company to realize where they fall on the CRM spectrum, said Rivelis. “Not one of our clients right now is interested in revenue generation, they’re interested in cost reduction,” he noted.

Companies are getting better at CRM because there tends to be tighter integration between call centres and Web sites, said Rivelis. Sales, product and marketing data are supplied more quickly, helping enterprises to make quicker (and better) decisions about how to satisfy customers.

According to Rivelis, Canadian companies are taking a stronger role in CRM than their American counterparts. Forty per cent of Canadian firms polled by CGEY said they have data for one-on-one customer marketing, compared to 20 per cent in the U.S. Thirty-three per cent of Canadian firms said they recognize customers at the first point on contact versus 15 per cent in the U.S.

Where Canada lags is in measuring marketing return on investment (41 per cent in Canada, 59 per cent in the U.S.) “In Canada we tend not to use that as much as our U.S. counterparts,” said Rivelis. “I would strongly argue that with the budgets that are being set for 2002 that measure may become more significant.”

In order to get the most out of existing CRM strategy, or before pursuing a new one, Rivelis suggested companies from a CRM advisory board with representatives from HR, finance, marketing, sales and other facets of the business.

Ultimately, CRM always boils down to the C. “People have talked about, ‘How do I make my relationship management more efficient?'” said Rivelis. “But the question is, ‘How do I make my customer come back?'”

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Jim Love, Chief Content Officer, IT World Canada

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