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The Short Ugly Truth About CRM

  |  March 23, 2001   |  Comments

Today's full-blown e-CRM systems go way beyond communicating and monitoring. They initiate a series of customer-service actions automatically. So why do e-marketers find their customers defecting to competitors?

If there's a bright side to the economic doldrums and the current dot-compression, it might just be the renewed urgency to understand what it is that customers want. And when they need it. Clearly, what passed for customer relationship management (CRM) among entrepreneurs panning for gold in the new economy usually turned out to be particularly expensive particles of iron pyrite.

It's not that e-business lacks the tools to collect data on customer preferences. From simple and free on-site polling to sophisticated survey techniques, call centers, live chat, live interactive talk, and full-blown CRM multichannel systems -- so many resources have never been available to entrepreneurs for tapping into the hearts and wallets of their customers.

E-marketers find themselves with satchels full of high-priced data only to see their customers defect to competitors. Getting fresh, hot data from the Web visitor is a lot less important than relating to that customer or prospect in Internet time.

From Tools to Systems

Today's full-blown e-CRM systems go way beyond communicating and monitoring. They initiate a series of customer-service actions automatically.

Burlington, Massachusetts-based Revenio Inc., for example, fields an e-CRM product that depends on events to acquire customer data and trigger actions. The Revenio Dialog system is heavily skewed toward email. "We do support cross-channel dialogs using email, Web site, call centers, and wireless, but demand for email is primary," says Jay Campbell, VP of product management. "Each dialog is triggered by an event."

For example, a typical sales dialog would be kicked off when an order is placed on the company Web site. That event automatically queues up a confirmation email soliciting information about the customer's job function. The system then generates an automatic order-status email... while cross-selling other relevant services based on the customer's job-function information entered into the CRM database.

Once the product is shipped, an email notifies the customer and asks when installation is planned. The installation date is folded into the system, automatically, generating another follow-up email down the road.

Follow-up, customer support, and ongoing cross-sales to this customer are automatically created by the Revenio Dialog, each step leveraging information gathered from prior interactions.

Does it work? To find out, I turned to Ryan Applegate, director of database marketing for iMarket's Internet division, zapdata.com.

zapdata aggregates mailing lists from many sources such as Dun & Bradstreet and Dunhill to produce a database of 12 million businesses and 35 million names. Its customers (85 of the Fortune 100 are on its list of 12,000 customers) can go directly to the zapdata site to build and download lists based on such selection parameters as SIC (standard industrial classification) codes, job titles, and ZIP codes. (zapdata does not offer email data through its Internet products.)

To manage his own customer database and its marketing activities, Applegate helped build an internal system but rapidly found it required far too much time-consuming manual maintenance. "We needed something more robust, complex, and reliable. Revenio's Dialog lets us use long-running complex programs without active management. For example, iMarket runs a series of Web-based seminars. We built a dialog that takes a random sample of 5,000 names a week and emails an invitation to the seminar, automatically. Using a different dialog, we can funnel customer survey responses to our sales force."

Despite the softening economy, Applegate claims a 64 percent year-to-year repeat business increase along with the generation of more than 250 highly qualified corporate leads attributable to a recent Revenio Dialog. The price tag? About $250K.

Separating E-CRM Tools From Action

Among the channels used by zapdata to keep in touch with customers is another online polling source, live chat from LivePerson. Live chat permits customers to access a customer-relations representative online via interactive text chat, an efficient system since the representative can handle multiple chats from his or her console.

"We're an ASP [application service provider]," says Larry Wasserman, LivePerson's vice president of marketing. "Our customers can have direct access to their customers online, gathering data and responding to customer requests immediately, without having to expand their own internal resources." Hardware, software, switches, and maintenance are all bundled together. The cost? About $2,000 for setup plus $350 per operator.

LivePerson, however, may not have been listening closely enough to its own customers. For all its efficiency, the interactive chat option is still a costly, time-consuming option to field for the large-scale enterprise. As LivePerson's operating losses mounted, the stock tanked. Beyond the economic meltdown and economies available through automated systems, LivePerson faces the challenge of new technologies invading its space, such as online Web-based video and the new Push to Talk online live voice system offered by ITXC.com.

ITXC, a leading provider of voice over Internet protocol(VOIP), has extended its technology to embedded Web site voice chat and -- in partnership with the Internet banner ad server, DoubleClick Inc. -- click-and-talk Internet banner ads.

LivePerson's Wasserman, however, remains confident in his company's approach, which decouples customer input from automated CRM action. "We're offering customers a wider range of CRM products, from systems used to develop FAQs on up to full-service chat, within our ASP model."

Could be, but FAQs, chat, and VOIP are tools offering only partial solutions for customers who, online or off, are still people.

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ABOUT THE AUTHOR

Zhenya Gene Senyak

Zhenya Gene Senyak of www.senyak.com is a bipolar writer/marcom pro based in a formerly lazy California chicken farming river town. A ClickZ writer, he's also the author of Prentice-Hall's "Inside Public Relations" and Public Relations Journal articles on cognitive dissonance and fear appeals, and is a contributor to Business 2.0, OMNI, Home Office Computing, Publish, and other onlineand offline media.

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