Instead of talking about mere customer relationships, our perspective has become more multi-dimensional. Now, we are talking about the customer experience. Tom Johnson, a managing director with business-consulting firm BearingPoint, actually sees Customer Relationship Management (CRM) maturing into Customer Experience Management (CEM).. He thinks CRM began to decline when its emphasis shifted to cost-cutting. "But CRM is really about driving growth, not cutting costs," he says. 
As a recent article in CIO Today suggests, CEM is about providing a consistent customer experience across all channels -- from marketing to sales to customer support. "If your brand's message is cheap and fast, then you need to be cheap and fast all the time, in every interaction with every customer," says Woody (Woodruff) Driggs, managing partner of Operational CRM at Accenture. "If you are high-end, you need to always be high-end."
The challenge within companies is, in many ways, a failure to communicate. "CEM starts by getting everyone who is important to the customer experience in a room," said Driggs. "We are constantly amazed to discover how often this is the first time that the key people from marketing, advertising, sales and service have talked to one another about what the customer experience should be."
What it shouldn't be is the thing Dell Computer is now trying to address. It began when Jeff Jarvis started making waves with his blog, Buzz Machine. In an "open letter" posted on the site, he berated Michael Dell for making shoddy product after his own $1,600 Dell machine crashed and burned (an experience I have had myself with a brand-new Dell). Apparently, the blog now gets 10,000 daily visits (with comments like, "Buy an Apple, Dude.").
Dell's response? The company got Jarvis his money back right away -- and has started actively tracking down angry customers (particularly the vocal ones). John Hamlin, Dell's SVP for U.S. consumer business, says Dell is adding more call centers and trained phone reps. "The customer experience is one of the most important issues for us," he adds.
There's that word again: experience.
If you are particularly interested in where this idea of customer experience management is headed, I suggest you consider attending the upcoming thinkAbout conference in Keystone, Colorado, which takes place September 14 and 15. It is hosted by Joe Pine and Jim Gilmore, co-authors of The Experience Economy.
"Our experience is not for the meek," they explain. "Each year, it attracts a potent mix of imaginative minds, business trailblazers, and experience mavens. These are people who truly desire to advance the boundaries of new offerings and envision new ways to think about the business of business."
August 07, 2005
Posted by Britton
One clear powerhouse of customer insight is UK-based Tesco. In a recent piece in the Economist, the high-growth retailer is recognized for its ability to adapt to and even influence British culture. "If an anthropologist wanted to know what Britain was like, he would do well to take his notebook to Tesco," the publication writes. "That's partly because it sells a third of Britain's groceries. But it is also because Tesco's customers are made up of the wealthy, middling and poor in just the same proportions as shoppers in the country as a whole. Tesco has become big by being like Britain." 
Tesco has proved a master at leveraging customer intelligence. It recently collaborated with the University College London's geography department to figure out how to make the most of its statistical information. However, it gathers most of its data from its successful Clubcard. With 12 million cards in use in Britain, Tesco can closely watch what its shoppers are purchasing. It then explores linkages between the products people presently buy and the ones they might be persuaded to buy next. “We believe we have one of the largest databases anywhere in the world,” says Martin Hayward of dunnhumby, which handles data management for the company.
As the Economist explains, "This knowledge allows Tesco to do two things. First, it can lavish attention on customers by giving them discounts on things that they buy routinely. Each cardholder gets a letter at the end of each quarter containing vouchers worth 1% of what they have spent. But they also get coupons that entitle them to discounts on products that Tesco's database, working much like the software that powers Amazon.com, suggests they might like. Last quarter, the store sent out 6m versions of this letter, each offering slightly different discounts....
Second, Tesco can adjust its shelves to suit the profile of the local area, or even the time of day. Tesco in Brixton, an area of south London settled by immigrants from the Caribbean, sells plantains, a kind of savoury banana that can also be found for sale on market stalls outside. Tesco stores in central London do not, but are instead designed around selling sandwiches to office workers at lunchtime and then ready-meals to them in the evening. The aim is to combine the local knowledge of the village shop with a multinational's economies of scale in buying and logistics."
Those are impressive capabilities. They position the company for increasing growth in the years ahead, particularly as its competitors continue to deny the extraordinary power that this intelligence delivers.
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Posted by Britton
None other than Accenture -- a longtime advocate of Customer Relationship Management technology -- has pronounced CRM a virtual failure in the telecom industry. Citing its own survey of 1000 UK consumers, it notes that CRM technology has not improved customer service.
Despite heavy investments in CRM on the service provider side, over half of respondents claim to have switched service providers because of poor service. "These findings are troubling for any industry with heavy customer interaction, given that poor service was the predominant reason for half of the respondents changing service providers in one industry or another last year," says John Freeland, global managing partner at Accenture's CRM practice. "Winning companies strike the right balance between using technology to help reduce costs, and streamlining the customer experience with well-considered processes that contribute to more personalized services."
One key annoyance was "technologies that delay or stop service" among 20% of respondents. However, long hold times was the key annoyance for 82%. Average UK consumers spend as much as six minutes on hold and speak to an average of 2.7 customer reps as they try to solve problems.
"I am not surprised by this report. It's a classic example of rolling out technology and expecting it to solve all your problems," says Chris Boorman, vice president of marketing for Europe at Salesforce.com. "Organizations need to focus on meeting business requirements first and foremost. They should not adapt to technology. Technology should adapt to companies, and it's crucial to customize for each industry. You cannot have an off-the-shelf product that suits every vertical sector."
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