CRM

CRM in my eyes is a very wide field and its complexity very much depends on the way it is implemented. A perfect example for CRM are Customer Cards, Client Cards or whatever you want to call them. You use them everytime you buy something at the respective store and this gives them the opportunity to start collecting data about you, their customer. The value of that data then is subject to the way it is processed and merged. What I mean is, it makes little sense to know what you are buying, if they don't also know e.g. your gender, your age, your demographic situation, etc. This makes it easier to start segmenting customers and put up statistics on them. For example which age group of what gender buys the most Justin Bieber tracks (not allowed to say CDs here anymore). We all know the answer to that one. But the quality of the information that can be gathered through such systems is mindblowing. And the effect it can have on your companys sales performance is outstanding. Yes, the example with the client card is a little worn out, so let's have a look at a modern way of implementing CRM in your company. Before that, I would like to try to explain the meaning of CRM in my own words:

CRM is collecting data about consumer behavior, analysing it and using the collected data for the marketing mix. Through this you are able to increase the customer frequency, their satisfaction and make them repeat customers instead of one timers. You really try to understand your customer better and make them come back for more. As a consequence your customer loyalty will rise and opportunities for up and cross selling will appear. The whole idea is to be able to provide relevant offers and information to your customers. How relevant that information is, depends solely on how well you know your customer and therefore, how well your CRM data is collected and used.

So much for that, now i would like to have a look at a few companies and how I think they implement their CRM. It isn't rocket science to see what happens above the surface, i.e. what the customer can see. But it is a little more difficult to find out what happens under the surface, i.e. what only the company sees.

Zappos takes pride in their customers sevices and they use it as their main marketing tool. Instead of investing in paid marketing, they make sure their customers are happy and let them spread the word. Being an Online Store like Zappos makes it easier to collect data from your customers. Through simple analysis tools like Google Analytics, you already gather a great deal of information about your visitors, those are not personalized though. That means you have a set of data, but you cannot link that data to single users. The great thing about online buying is that your customers usually sign up on your page and willingly provide you with all sorts of information about them. And even better, if they are logged in while they surf on your page, you can tell exactly what they looked at, what they bought, and therefore start knowing their preferences. Simple. Amazon has been doing that since the beginning. Rather annoying sometimes in my eyes, especially if you just click on a product once, without special interest in it and then you are flooded with suggestions about this product category which is not really relevant to you. So the system does have its flaws, but hey, most times you do search for things which actually are relevant to you.

The European pendant to Zappos, Zalando is also implementing the same stragegy. And to make sure it is done properly, they outsourced the whole thing. This happens rather often, considering that CRM can become a very costly and complex tool, also depending of the size of your operation.

Times are changing and so are the rules of the game. With new players, you need new strategies. Tablets and smart phones have proven to have a mayor influence on todays CRM strategies. Because now you can not only follow your customers at home or in the office, but pretty much everywhere they go. And with a little thing called geolocation, you can even tell where they like to move around, where they shop, which bar they go to celebrate happy hour etc. and provide them with relevant offers taking their current location into consideration. Here you can see a little video about how geolocation works and what it is good for in marketing.

To wrap it up I would like to say that with the technical possibilities we have today, it has become rather easy and relatively cheap to start implementing CRM systems, but it is not so easy to use them effectively. This is probably the reason why a lot of companies outsource this. However, it is an absolute must nowadays for any company to know their customer and build up a relationship with them. No matter if that is done through large and costly software systems, or simply through minimizing the distance between you and your customer.

Cheers! P

e&m-Business

Before starting this course, I had a normal working knowledge on e-commerce, especially due to the fact that I am co-founder and part of the management team of a company that offers e-commerce services on a b2b basis, and also builds and manages e-commerce platforms at own risk. This has given me profound insights on how the business works. But like with everything in life, you never stop learning. And in this particular case, I believe you should learn one new thing every day. It is such a fast paced and innovative environment, it is hard to keep your knowledge up to date. And also due to the fact that the web is not static but extremely dynamic and new ideas and concepts come out on a daily basis, it is very difficult to analyze what is useful, what is a trend and which innovation or business model will help shape the future of what we know as e-commerce today. So jumping on to every train can be a dangerous strategy. It can also be a dangerous strategy to be the innovator and come up with mindblowing ideas. Why is that? Well, if we look at some of the first search engines for example. Remember Altavista or Lycos? No? I don't blame you. What they did really was paving the way for Google. As an early mover they had to deal with all the difficulties and obstacles you encounter when bringing a new concept to the market. Once the technology and the concept was ripe, it got harvested by others such as Google or Yahoo. So we find similar situations in e-commerce. Especially if we limit the scope to b2c e-shops. Many trends disppeared as fast as they appeared in the beginning. Take the electronic malls as an example. A few years ago it seemed to be a trend and a promising concept to have multiple brand stores united on one platform. Really, all of those platforms more or less diappeared. Needless to say, that sometimes old trends which didn't work out can get a new boost through innovation. This is what I believe with regards to bulding successful strategies in e-commerce: Do not take every trend as a template for a succesful business model, most of them die within a year. No matter if there was a huge hype around it or no hype at all. Make the customer's life easier. Complicating the shopping process for the client because you want to show everything you can do with your programming skills and apply what you've learnt at your last photoshop course is a conversion killer. Keep it simple. Take Amazon as an example. Amazon obviously has a very sophisticated site, but they don't need to bloat things with tacky animations and background music. They are succesful because they offer almost anything you could want to shop for, they offer it at very competitive prices and they make sure you have it within a couple of days. Obviously, if you want to enter this market, don't try to compete with Amazon. Rather try to find your vertical spot where you can shine, and maybe one day Amazon will knock on your door and offer you an irrefusable amount of cash. Bingo!

One thing I haven't been able to work with a lot so far is m-commerce, or m-business. I will refer to it as m-business, because the scope goes far beyond simple business transactions. Through the technology we hold in our hands today, we can also manage our clients, business partners and our employees. When you receive a package via UPS or any other of the many parcel services, you will sign for the reception on a digital mobile device. In fact, UPS was one of the first companies to implement such a system and you could say that this was one of the first appearances of e-business. In this case, the digitalization of the delivery process was an advantage for the company as well as for the cusomters. It made it easy to track the delivery, control the employees performance and therefore increase efficiency and customer value. UPS' "Parcel Men" currently use the DIAD (Delivery Information and Acquisition Device) and the GSS (Global Scanning System). The DIAD helps tracking the delivery, supplies a regularly updated delivery list, captures the pick ups and the deliveries and secures communication with the distribution center. The GSS is responsible for capturing the parcels at the distribution centers. Obviously we (almost) all own smart-phones and we know the possibilities those devices give us. The example of UPS is to show you, that m-commerce is more than just mobile gadgeting. It can be a core element of a companys process structuring and therefore of its value chain.

Nevertheless, we cannot ignore that there are millions of mobile internet devices (MID) out there and we need to take that as an opportunity to, amongst others, enhance our customer relationship management and advertise more efficiently. In the U.S. the mobile advertising market is expected to turn over $3.1 billion in 2013. Here you find a great article about mobile advertising and CRM. For me there are two aspects which make m-business worth getting into. It gives you the ability to follow your customers wherever they go and therefore collect valuable data about their consumer behaviour. And it makes it possible for you to be in touch with your clients at all times, hence be closer to them and have a tighter realtionship. Again space is limited, for more on this topic check this out.

Cheers! P