Page 270 - DMGT308_CUSTOMER_RELATIONSHIP_MANAGEMENT

Unit 11: CRM Measurements

answer that is to say that CRM should measure those company activities that pertain to or can Notes
benefit specific customers as well as specific customers’ behaviour and mindset.

11.1.3 Predicting Future Market

Companies have a need to use CRM technology to help anticipate customer needs or otherwise
predict a future customer or market state. Within marketing, there is a long history of using
predictive modelling techniques to test out potential marketing approaches to determine how
successful the program will be in advance of launching the entire program. CRM technologies
and approaches are being used to help companies improve the design of existing products and
build new innovative products through closer collaboration with customers. Digital technologies
let companies engage customers in a less costly and highly measurable dialog.
As more companies and value chains adopt CRM technology and as the technology gets more
robust, companies will be able to capture a fairly comprehensive set of data representing the
behaviour of a market. This information gives these companies clearer insight into what direction
their market and customers are headed. From there these companies can determine how to
shape or adapt to their changing market conditions. While specialized companies like ACNielsen
and IRI are information companies that capture consumer insight and resell it to companies at
different points in an industry’s value chain, more companies will be able to “go it alone” and
develop comparable capabilities themselves. General Mills now conducts 60% of its market
research themselves on the web, up from 20% in 1999 (Ashton, 2001). Doing so carries strategic
significance. The type of dialog between the company and its customers can get increasingly
tailored to the company’s brand and value proposition for proprietary competitive advantage.
Companies use CRM technology to help predict future states in other ways. Gathering customer
insight to drive product or service innovation can take many forms, from well-controlled research
experiments and surveys to more collaborative and ethnographic approaches. All of these
approaches collect data that can be structured and measured. For more traditional CRM system
implementations, companies frequently pilot the solution within a single business unit or
customer segment (or a small part of a customer segment) to determine if the program will be
successful before being rolled out to the entire company or market.

11.2 Factors Making CRM Measurement Complex

Several factors have conspired to make CRM measurement increasingly complex:

1. The appearance of many different digital channels to exchange information with customers
2. The ability to distribute all or parts of the product/service bundle through digital
technologies

3. Business unit silos causing differentiated and disconnected technologies and human
processes
4. Product silos causing differentiated and disconnected technologies and human processes

5. Increased data and process integration between companies within a value chain
6. Differing styles of customer decision-making approaches
7. Differing CRM measurement purposes: influencing collaborative decision-making
processes, guiding ongoing activities and predicting future states
The challenge for businesses is to weave together a CRM measurement approach that deftly
handles these complexities and constraints.

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