Customer Relationship Management | A Customer & Brand Strategy Blog

2011 Is lurking around the corner. Time to reflect on how well you did (or are expected to do) in 2010 and prepare your strategies for next years. If you are in marketing and/or Customer Relationship Management you will probably be looking at how to balance multi-channel (or cross channel) approaches in combination with the rise of online social networks and new technologies to seek new (Customer) relationships and mine both data and Customer feedback. You may even be thinking about how to design Customer experiences that drive word-of-mouth through these social networks.

Whilst all of these approaches may make sense I like to share with you some of my thoughts on the above and provide you with 5 notions I believe you should embrace in your 2011 Marketing Strategy to start driving for real change and get ahead of the ball-game.

Three things you should (have) be(en) doing

For starters I believe that preparing your organization for multi/cross-channel interaction with your Customers is deferred maintenance. If you didn’t purposely design for a multi/cross-channel Customer engagement strategy already, you are lagging behind. And yes, social media should be added to the mix too. And don’t forget: this is not about designing for a one-way highway out of your building. You need to design for incoming traffic too. Or better even, for places you and your Customers can meet and exchange knowledge, ideas and experiences.

Secondly: influence in Social Networks is not new. What has changed is that peer trust has increased in importance for Customers and more so that “first hand stories of experience” are accessible for them. Better accessibility and creation of knowledge, in the broadest sense, through (on-line) social networks is the true shift. Enabling your Customers to share their experience with peers and other Customers is an important first step. Make sure your aim is not only to spread the good stories, but that you learn from them and the forces that drive the social networks of your Customers too.

Finally: the importance of Customer experience is not new either, nor has it’s importance increased. Like it has been for ages, we just need to getter better at it every day, to keep up with the increasingly rapid pace of change in the market place. More importantly: don’t limit your experience design to the Customer’s journey ending in a sale. Extend into the much richer experience of Customers getting their jobs done.

5 Notions to embrace

Leading companies are doing, or have already adopted the above. More importantly they have adopted a way of thinking and acting that has provided them with access to new insights, new technologies, new market segments, more new and loyal Customers and evidently a better position in the market place to continue to grow. I believe you should not try to copy what they are doing or have done. It is about embracing the “notions” that are feeding their strategies and actions.

These companies have embraced:

the notion that (1 on 1) push-marketing strategies and transaction-based Customer analytics are strategies with diminishing returns;
the notion that Customers are not means to extract value from, but can be, want to be and are, active participators in the process of mutual value co-creation;
the notion that this implies a shift in focus from marketing for value exchange to marketing for value in use;
the notion that opening up their knowledge stocks and continuously tapping into the flows of knowledge both inside and outside their companies provides them with competitive advantage;
the notion that empowering people (and with people I mean Customers, employees and partners all alike) in communities of likeminded and/or shared interests to solve their problems or do their “Customer jobs” better than anyone else, trumps influencing people to sell to their community for you.

There are many great examples out there, which have been described by leaders like John Hagel, Steve Vargo et all, Irene Ng, Frank Piller, Umair Haque, J.K. Prahalad, Venkat Ramaswamy and Francis Gouillart.. And you’ll recognize other examples intuitively around you when you encounter them.. Again: it is not about copying them, but adopting the underlying principles and design your own strategies and actions from there.

Some final words

The above is not Social CRM or Social Marketing. I (naively) want(ed) it to be, as you may have read in some of my previous posts. The market decided otherwise. No hard feelings by the way, it’s not the acronym that’s important, the great people, ideas and innovative practices within the space are.

Some refer to it as “conversational” marketing. Steve Vargo has announced “it” as the arrival of “the age of co-creation and service-dominant marketing“.

The problem may not be so much with what we put in front of it, but how we perceive, interpret or give meaning to words like “marketing” or “customer relationship management” through our designs and actions.

My closing question to you would be: what methods, approaches and/or changes in (service system) design and (marketing and/or crm) actions would be required for a company to be able to say: “we master the capability of social, co-creative, conversational, service-dominant, pull, relationship marketing”?

Share your ideas in the comments!

I strongly agree with Paul Greenberg that Social CRM is all about looking for answers to the Social Customer. Social CRM is about turning CRM from the inside out to the outside in. This is easier said than done, and mostly easier written than said..

A couple of weeks ago I wrote about how Social CRM is about the relationships of your Customers (of which the relationship with your Company may be a part) and not primarily about the Company – Customer relationship. Today I would like to discuss Communities.

Communities are about people, not business functions

Communities, in respect to Social CRM, are mostly discussed in relation to business functions (like Customer support communities). Communities are about people though, because that is what they consist of. Business functions is what a business needs or wants and is therefor a typical inside-out way of looking at communities. I believe it is of vital importance, if you want to be successful in Social CRM, Social Business or Business in general for that matter, that Communities in fact are people who share a certain passion, relationship, interest, need or whatever it is that bonds this group of people, through stronger and/or weaker ties.

If you understand that communities are about people that center around a certain interest or need, a whole new pallet of opportunities arise. I’ll focus around one specific element: Customer Segmentation.

Outside-in Segmentation focuses on Customer needs

Most companies segment their Customers the inside-out way. They make attempts to label specific Customers based on common characteristics in their Customer base. Mostly these characteristics involve things like Customer Lifetime Value (or revenue for the less advanced), demographics, transactions, product-combinations, purchasing behavior etc etc.. When we see communities as groups of people that share a certain passion or interest, we understand that labeling Customers on the above inside-out characteristics makes little sense, if it is not preceded by the Customer way of segmentation: By their needs and shared interests.

And this is where it gets more difficult. I think most conversations in the Social space will not tell you anything about this, unless.. Unless you find yourself a way to engage your community to do so, somewhere where you can see, observe and even engage in these discussions. People will not talk about this in so-called support communities, where they visit you to get some answers to problems they have in creating value from the products or services they bought from you. They will talk about their needs and jobs-to-be-done when among likeminded and peers.

Not all Customers have the same needs

So, should you build an innovation or co-creation community? I’d say, good idea, but then you are again focusing on your own business needs and function. When you truly put your Customers interest at the heart of your thinking, you would think of your Customers as people that share common interest. You would want them to share their passions and interests, and their experiences as they are trying to get the job they want to do, as to better understand them. And, since not all your Customers have the same passions and needs, you would want to segment your Customers according to these passions and needs. Because if you do, you get exactly what you want: Customers engaged into conversations, not with you, but with other people they share the passion with, and you can be one of them.

Now I would like you to shake off the idea of online communities (yes, you were thinking about those, not?) and think Customers segments and communities of people.

How would your CRM Strategy be different if you segment Customers into need-based communities?

If you understand which Customers share the passion and need, how would you go about treating them differently than Customers that don’t share those needs? How would you differentiate your product or services to better meet their needs? How would you design the service experience differently? How would you be able to better find correlations between sub-segments, by more traditional characteristics, and how would that help you better target new Customers? How would you be better able to design campaigns? Not easy questions to answer, but I bet you, if you listen really well, online and offline, you will find the answers. And I bet you that Customers will notice that you started talking their language, not yours, even if you want them to engage into your value proposition.

You will not make the difference for your Customers by implementing tools. You will make the difference by learning to think people, not functions, by learning to think from the outside in. And by leveraging that thinking to better design the end-to-end Customer Experience, focused on communities of people with shared needs. Try it, it’s fun!

What do you think? Does segmenting your Customer community by their needs make sense?