The concept of customer relationship marketing is nothing new. For decades, we have chased after the competitive advantage that one-to-one customer interaction promises. Along the way, we have used the available data and analytic tools to understand the needs and behaviors of consumers; and, using those insights, create value through individual experiences that address their desires.
Today, with the mass digitization of audience platforms, the onslaught of big data, and the opportunity of addressability at scale, we are able to drive more personalized engagements with individual consumers, across media, channel and device. It is now possible to manage these interactions at scale, throughout the customer lifecycle, to optimize the value of customers and segments. We call this Connected CRM. The foundation of cCRM is a clearly rationalized strategic framework that is widely adopted at all levels of the organization and forms an ongoing process.
It's easy enough to buy into the concept. The difficulty comes when the company realizes that adopting and operationalizing a cCRM approach requires enterprise-wide transformation. It is a journey that promises to impact the entire customer strategy. Crucial to its success are strong leadership; well-established customer currencies; a diverse group of internal organizations with specific, digitally oriented skill sets; and the selection of the right external partners.
In 2013, Merkle conducted a study to investigate how large U.S. organizations are driving value using customer relationship marketing. The study examined overall perceptions of CRM and explored factors that are correlated with successful execution.
In our research, we surveyed more than 350 executive-level subjects, across multiple industries. Questions related to 18 different CRM success drivers. Respondents were asked to rate their organizations on the extent to which they performed or pursued each one. The subjects were segmented by those who were -- or were not -- finding organizational success and individual career success. Performance against the success drivers was studied among the groups to understand which activities worked and which didn't.
It is interesting to note that, according to our findings, even if the cCRM initiative is regarded as successful in the organization, oftentimes the leaders aren't successful. Conversely, leaders sometimes find success even without effective execution of a cCRM strategy. There could be any number of reasons for this phenomenon; an important one being that conflicting incentives among organizational silos and objectives can negatively affect success rates.
The 18 success drivers gave us the basis to identify five themes that are key to successful CRM transformation. These keys create the focus needed to align leadership and organizational success. Although they are not an exhaustive catalog of every change practice, they are essential areas that represent both the greatest struggles and most promising opportunities for organizations.
Key 1: Sponsorship. Permission does not equal sponsorship. Effort and commitment matter significantly. An executive mandate is the only way to achieve success.
Key 2: Customer vision. Open communication brings the customer vision to life, makes it easy for people to understand at all levels, and sets the stage for the operating changes to come.
Key 3: Target operating approach. Leaders across the enterprise need to accept the fact that their roles and organizations will be different, and their teams will have to adapt for continued success.
Key 4: Planning and financial commitments. Stakeholders, including executive leadership and senior management, must commit to the plan and to following through.
Key 5: Implementation and change management. You must find effective ways to sustain broad support through the difficult periods and continuously prove the value along the way.
Merkle's recently published book, Connected CRM: Implementing a Data-Driven, Customer-Centric Business Strategy, written by CEO David Williams, is an exploration of the framework and competencies that enable organizational transformation. In it, he delves into greater detail about the principles behind cCRM and how to optimize customer value in a big-data, digital world.
About the Sponsor
Merkle, a technology enabled, data driven customer relationship marketing (CRM) firm, is the nation's largest privately-held agency. For more than 25 years, Fortune 1000 companies and leading nonprofit organizations have partnered with Merkle to maximize the value of their customer portfolios. By combining a complete range of marketing, technical, analytical and creative disciplines, Merkle works with clients to design, execute and evaluate connected CRM (cCRM) programs.