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19 Feb 2001, UK


Dear Dr Ecommerce,

I am currently working on a dissertation on CRM. I have worked for a global company and been involved in implementing a CRM system in the UK. I would like to highlight the challenges of implementing CRM and the real opportunities that can be gained from B2B CRM systems.

What do you feel are the reasons for high failure rates, and what do you see as the real benefits that can be gained long term?

Also are there any good specific CRM sites that provide research into the area?

Thanks,

Alex

 

Dear Alex:

There are a number of reasons why CRM systems go wrong. I frankly think one of the biggest problems is that the concept of CRM dehumanises the customer and forgets the notion of customer service. Sure, CRM solutions put the customer at the centre, help businesses develop customer-centric strategies and more. But by automating the process, the customer becomes no more than database entries. And how would you like to be relegated to database entries?

I've seen CRM compared to the neighbourhood grocer who knows all her customers and treats each one differently. CRM, it is said, simply allows far bigger enterprises to do the same thing. Sadly, CRM does not include intuition, the ability to judge customers' moods or the ability to improvise. On seeing a clearly upset customer - who is usually stingy - entering the shop with a bottle of expensive wine that has been opened and is 1/4 empty, the grocer can immediately guess that:

  • the wine has gone off
  • it was a special purchase
  • the customer is upset about this.

The grocer would know

  • this is not the time to offer coupons for dishwashing liquid.
  • it is a time to put on a sympathetic face
  • It is a time for commiserating with the customer and quickly providing a replacement bottle.

The grocer's CRM software, unable to read the customer's mood or see and make assumptions about the bottle of wine, might determine from the customer's purchasing habits that this would be a good time to offer those dishwashing liquid discount coupons.

Of course the CRM gurus have some other ideas about why CRM goes wrong. These reasons usually include:

  • not integrating the CRM system properly. Many users (especially those duped by fast-talking sales people) believe they can take their CRM kit out of the box, install it on the network and, viola, CRM. In fact, it needs to be properly integrated with other business applications and configured for the business

  • Users don't define their needs before purchasing a CRM system. The boss believes a CRM system is necessary, reads the reviews and buys the coolest system available.That system may be very cool indeed, but it may not be the ideal system for her company's needs.

  • Not devising a full CRM strategy. Some companies feel they only need to install the CRM software and it will take care of everything. In truth, it is necessary to establish a CRM strategy.

Regarding benefits, I must say I am a little dubious. However, if a company implements a proper CRM strategy which bears in mind that a customer is a living, breathing entity with feelings and who can be unpredictable at times, then there is the potential for improving customer service in a way that also maximises profitability.

A couple of good CRM resources on the web include www.crm-forum.com/ and www.crmguru.com/.

Good luck,

Dr. Ecommerce

 


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