(With a Little Help from its Friends)
In previous posts, I discussed Net Promoter’s relevance to the CFO and the CEO—the butcher and the baker, if you will. Next up is the candlestick maker. He’s the guy who’s busy shedding light on complex software packages like CRM. Yes, he too is about to become a Net Promoter advocate. As we’ll see, not only is Net Promoter a complementary approach to CRM, it could also be its savior.
Let’s start with a candid assessment of the CRM industry. Whether you define CRM as a technique, a business process or a computer system, it has undoubtedly enjoyed explosive growth over the past decade. Companies such as Siebel, Salesforce.com, Oracle, SAP, E.piphany and many others have earned billions of dollars of revenue selling CRM technology and services, mostly between 1995 and 2002. Meanwhile, major systems integration firms such as Accenture and IBM have built huge practices around implementing CRM solutions -- efforts that continue to this day.
The money has certainly gone in. So what came out?
According to Gartner, not a lot. As one analyst said, “Companies have spent millions of dollars on CRM systems to reduce internal costs and increase their sales and call-center operations yet they know nothing about their customers.”
Relax, help is on the way, and it’s coming from two directions.
First, Net Promoter represents an outside-in view of customers. Essentially this consists of attitudinal data about why people buy your products, along with how they “feel” about your firm. CRM systems typically provide an inside-out view of customers. They capture behavioral data such as what products customers bought and what events shaped their decisions.
These two sets of data are obviously complementary: by linking behavioral and attitudinal data, we can explore both the historic and projected behavior of customers. We can also shape our product strategy to meet the needs of the most profitable segments of the customer population. Behavioral data without attitudinal data lacks the “why” of customer behavior, which is essential to predicting what customers will do in the future. Without behavioral data we lose context and segmentation.
How does this save CRM or get the CIO on your side? Well, one of the biggest challenges facing CRM is adoption, especially by the sales force. If all CRM does is recycle the information sales people already know about their accounts, there is little motivation for them to enter the data at all. Once we can add new Net Promoter data that contains additional insight, the sales folks will sit up and pay attention.
The benefits flow both ways. Closed-loop feedback processes are an important part of Net Promoter strategy, but they are only effective if you can scale these processes across the entire company. How do you increase the take up rate? Tie Net Promoter to an existing system that already has corporate mindshare. As some of you already know, introducing an entirely new system to front-line employees can be difficult. But integrating the Net Promoter process into existing CRM workflows might just do the trick.
Obviously you need a reliable source of customer information if you are going to contact people about their willingness to recommend your products and services. Customer contact data is the cornerstone of any Net Promoter solution. This is where an investment in clean CRM data really pays off in your Net Promoter program, since customers who respond represent your best Net Promoter contacts. Not only do you know they exist but they have already identified themselves as engaged with your enterprise! Watch out, you might end up with a real, active customer database – with valuable data to boot.
If this is such a great opportunity, why hasn’t it happened already? The answers are usually more practical than strategic. CRM data is rarely clean and many firms are daunted by the prospect of cleaning it up. Focusing on Net Promoter, with its demands for high response rates and reliable metrics, forces you to create quality data by cleaning up your CRM system.
In addition, not all CRM providers consider this a priority. Their principal customer is generally an IT professional whose mandate is to manage systems rather than to engage in marketing or quality transformation. The CRM universe of behavioral data is well understood. The murky waters of attitudinal data require a very different type of expertise. Attitudinal data is dynamic, meaning the nature of that data changes from year to year as the Net Promoter program and your customer relationships evolve.
Of course, some Net Promoter managers realize that tying their program to the fate of the CRM system doesn’t necessarily represent a golden opportunity. Many CRM implementations are still challenged to deliver value, are hindered by complex IT processes, or have a bad reputation within the company. Nevertheless, these two star-crossed lovers can’t be kept apart forever. Forward-looking firms are starting to see the opportunity to rekindle moribund CRM programs with an injection of Net Promoter insight. This tendency is creating an entirely new pull for such programs and a new set of constituents within the company. More importantly, it presents a great opportunity to engage the entire customer-facing workforce.
Now you know how to approach the CIO, and what hurdles may present themselves along the way. Stay tuned for my final blog in this series, where you will learn how to engage the chief marketing officer as a staunch advocate of your Net Promoter program.
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