6 E-CRM Trends to consider for 2012 planning
I’ve recently asked several CRM specialists including Paul Greenberg and Shaun Smith to describe how they see the key ECRM trends from 2011 which will also be important in 2012. I’ve picked out 5 key trends
E-CRM Trend 1. Brands as curators
Shaun Smith, founder of Smith+co believes there are a number of innovations that have become more popular this year as businesses seek to deliver deeper customer experiences. This includes brands positioning themselves as curators to ensure that they provide added value to their customers.
“Increasingly, brands that are really clear about what they stand for have the credibility and the authority to be able to recommend other things associated with that brand,” he explains. “So Nike, for example, has an app called True City that will recommend all the best places to go to in a city you are unfamiliar with. If you like driving, BMW has an app which allows you to search for the best driving roads, using GPS to take you to them. Tesco has a wine finder, so if you particularly like wines you can use this to scan a bottle of wine and it will tell you what it will go with, what it will complement, and other wine varieties. So increasingly brands are becoming curators and providing information to customers about things they want.”
There has also been an increasing blurring between online and in-store experiences, to deliver customers the benefits of both worlds.
Smith continues: “Burberry has created a whole process called runway to reality whereby using the iPad you can look at their products, you can order those products, you can see them being used and so on. And the iPad can be used both digitally – so when they have a runway show you can view it on your iPad and you can order purely digitally – or you can go into the store and the have iPads in the store for you to look at the products, try different looks and if they don’t have that particular product in store you can order it.
“And vice versa, the other thing that we’ve begun to see happening more is that people have become used to price and product comparisons online, and some retailers are beginning to do the same thing now so you can go into the store and there is an opportunity for you to have recommendations from other customers or from the sellers or to compare those different products in-store.”
E-CRM Trend 2. Social CRM makes strides forward
Unsurprisingly, 2011 was also characterised by further strides in the social field, as many businesses moved out of the experimental stage to become more sophisticated with their social media use and its integration across business functions.
Global spending on social CRM, for instance, is forecast to hit $820m (£505m) in 2011, according to analyst Gartner, up from approximately $625m (£385m) in 2010 – though social CRM remained less than 5% of the total CRM application market.
According to Paul Greenberg, author of CRM at the Speed of Light:
“2011 has been the year that social CRM emerged into the mainstream – in actual conversation, that is, not in deployment,” says Greenberg. “Social CRM is actually [moving] a little slower than it should, but it is one thing that people will say about 2011.”
Greenberg also highlights growth of marketing automation and social marketing tools, with early signs that vendors are responding to the growing interest in utilising social marketing as a “kind of core marketing strategy”. “We’ve seen some signs of that with Oracle incorporating marketing from their Market2Lead acquisition into Oracle CRM On Demand,” he adds, also pointing to the growing prominence of companies like Crowd Factory.
Elsewhere, Mark Blayney Stuart, head of research at The Chartered Institute of Marketing, has noticed how social media marketing has matured over the last 12 months.
“The difference there is that whereas perhaps a year ago what we were trying to get were ‘likes’ on our social media marketing, what we now want is for people to be talking about us – not just liking us,” he explains. “We want those conversations to be created. And that is why just in the last couple of months or so we have started to see on Facebook and other places is not just the ‘like’, but also for instance ‘122 people talking about this’, because that is what we now want we want to achieve and be able to measure.”
E-CRM Trend 3. Customer service now seen as key within overall brand experience
“The critical thing that has happened this year is that the competition between organisations has increased immensely,” says Jo Causon, CEO of the Institute of Customer Service. “If you take our UKCSI stats and look at the retail sector, which is the top performing sector, and look at the competition between the top five organisations, there is hardly any gap between their actual performance. And secondly, we have less money in our pockets as consumers, while the balance of power continues to move in favour of the consumer.”
These factors have combined in 2011 to create the ideal environment for customer experience management to take on greater significance than ever before.
“We’ve cut all the costs out, so how are we going to differentiate ourselves?” continues Causon. “The only way to differentiate yourself in the marketplace is through service and experience. And there are a growing number of organisations that understand that. If you look at high performers they consistently invest time, energy and money in the customer experience.”
At the most fundamental level, this has led to some businesses rethinking the experience they provide via their existing customer touchpoints.
“A few weeks ago Santander said it was closing all of its offshore contact centres and bringing them back onshore so that they have better control of the brand and the customer experience,” highlights Shaun Smith. Obviously Santander is a long way short of being best-in-class in terms of customer experience, but is it interesting that they have taken that strategic choice to improve their cost base to get a better control of the customer experience. Companies like Zappos and First Direct have for some time now realised that the contact centre is a primary touchpoint and therefore a primary means to bring alive your brand values and have an experience with your customers that is consistent with your brand.”
E-CRM Trend 4. Service communities
2011 also saw an increasing number of businesses reappraising the customer experience they deliver in a much more profound way. According to Paul Greenberg:
“The customer experience has always been the core of customer relationship management (CRM), but what has happened is that it’s finally being realised that it is actually not only a theoretical core, but it also needs to be the focus of what companies do when it comes to CRM”.
“Customer demands are now so strong, overwhelming and personal that it has led to two things. One is there is a newfound desire to better understand and predict customer behaviours. And two, the customer experience has become the focus because that’s what customers are demanding – they are demanding an ‘experience’ with you rather than just a transactional experience”.
“If you are going to be a company that I’m willing to devote more than just my normal utilitarian purchase with, then you need to give me more than just a discount. You need to let me decide the kind of experience I want to have with you, which means that you have to be transparent enough to provide me with the kind of information I need to make an intelligent decision about how I want to interact with you, and provide the tools I need to make that intelligent decision. And that’s the kind of stuff we’re starting to see companies respond to for the first time, which is really, really important.”
Arguably no model better demonstrates the two-way benefits that this transparency and trust can deliver than the proliferation of service communities, and there are a rising number of organisations that are reaping the rewards of opening up their knowledgebases to help customers help themselves and eachother.
“The growth of service communities was a big deal this year,” says Greenberg. “We began to see companies that were built around customer engaged service communities, in effect almost customer-driven self-service communities. There was story after story about this – giffgaff is one extreme but also even Comcast’s forums and the Best Buy forums and the ACT! forums where customers are solving their own problems with the help of other customers. That kind of stuff emerged big time this year.”
E-CRM Trend 5. Behavioural advertising and mobile CRM
2011 also marked the year that the behavioural advertising playing field changed significantly – largely because of its large scale uptake, but also because of new regulation.
“Behavioural advertising has really taken off,” he suggests. “We’re now getting adverts on the side of the screen that are directly personalised to us because they’re aggregating sites that we have been looking at. So if I have been to Italy this year I’ll suddenly start seeing adverts offering me cruises nearby or related books and that kind of thing. And that has got a lot more sophisticated over the last year and it is good to see that on the one hand, because it means that we’re able to reach customers much more effectively. On the other hand, what it also means of course is that this is bringing up privacy issues and the new cookies law has been brought in as an absolute direct response to that.”
In May, amendments to the EU Privacy and Electronic Communications Directive came into force, requiring companies to gain consent before they place cookies to track and monitor online behaviour onto consumers’ computers. Having major implications for behavioural targeting, organisations have been given a year’s grace to conform to the new rules. Despite this, Blayney-Stuart believes that the real implications of the regulation won’t be felt until 2012.
“The cookies law has been designed to make companies’ use of customer data much more transparent, so it is a good thing. But very few companies seem to have acted on it. There is a period of grace until April, but everyone has to be compliant. What I would say to people is to get ahead of the game and do it now because there is going to be this sudden flurry in March when companies are asking for cookies acceptance. The companies that lead the way on that are going to show that they are meeting their responsibilities.”
E-CRM Trend 6. Mobile CRM and CRM investment
Greenberg also notes that mobile CRM emerged in 2011 – though not necessarily in the way that many were expecting it to emerge.
“People were looking at it from the standpoint of traditional CRM silos – so it would be mobile SFA, mobile marketing and that kind of thing. And those things happened. But you are also looking at activity streams on mobile devices, meaning the conversational aspects of CRM and social CRM were beginning to emerge on mobile devices.
“The other thing we started to see, from the back-end analytics side, was the ability to actually capture, expose and report analytics data on a mobile device. That was an important emergence for 2011. And the iPad drove that. In fact, the iPad drove everything. It was the year of CRM for the iPad, and customer engagement for the iPad. The mobility side driven by the iPad was just a dynamite explosion this year”.
“Everybody has developed applications for it, CRM companies have built applications for it, everybody is using it and they are using it for the actual hardcore operational stuff and for the engagement side. So they have managed to figure out how to use this device for both ends of CRM which I think was a huge and not entirely expected activity for 2011.”
In fact, the CRM market as a whole continued to see greater investment – with IDC forecasting that the CRM applications market would grow 7.6% over 2010, to hit $18 billion in revenue terms. The market researcher suggested that three out of four of the sector’s sub-segments would experience above average growth. The marketing and sales application spaces are expected to grow at 8.8% and 8.6% respectively, while sales of customer service packages are likewise predicted to grow at 8.2%. Even the contact centre application area, which experienced a modest decline in 2010, would demonstrate growth rates of 5.4% year-on-year, said IDC.
With the Institute of Customer Service talking about a “war for customers” in 2012 as competition becomes more fierce in the difficult trading environment, it seems reasonable to expect further investment in these areas in 2012.