At first blush, it doesn’t seem that different from traditional marketing. Ravi Kalakota, in his “Electronic Commerce: A Manager’s Guide,” published by Addison-Wesley, says that “the importance of attracting, pleasing and keeping customers is as old as the notion of marketing itself. What is new, however, is the use of technology for the active management of a firm’s current customer base as a strategic asset.” The goal of technology-enabled marketing, he says, is simply “to use technology to add value to every customer interaction and produce revenue growth.”
Kalakota puts his finger on customer asset management (CAM) as the primary means by which technology is deployed in a company to enhance marketing activities. “Basically, customer asset management is the integration of the front-line activities in a supply-chain — namely sales, market intelligence gathering, and customer service — to act in a coordinated manner rather than pulling in different directions.” But CAM itself is based on a premise which has been kicking around for a long time, “that customers are the most valuable asset of any business,” he says.
He’s not alone in that assessment. Technology research firm Gartner Group has recently written, “Bottom line: All firms are undergoing dramatic changes as technology-enabled marketing emerges as the marketing model of the future. Companies run the risk of being swept aside if they fail to understand the shift.”
George Colombo, principal of automation vendor Influence Technologies Inc., says in a recent white paper “From 1993 to 1998 — The Metamorphosis of SFA” that “customer asset management” is even coming to replace the term “sales force automation.” He recounts that an executive recently told him “the term ‘sales automation’ is on the verge of being obsolete. ‘Customer asset management’ is a term you’ll hear instead.” The practical difference, Colombo explains, is that “rather than narrowly focusing on the deployment of technology in the sales organization, companies today are creating an environment in which information is easily shared among users in every department that touches the customer.”
The focus, therefore, is moving away from technology the customer must fit into, to technology that is built around the customer. As Colombo says, it’s not enough just to have your sales department automated to the teeth. Describing it as automation “beyond the sales department,” he says true technology-enabled marketing today brings together “different corporate organizations such as field service, help desk, customer support and accounting,” giving them all “access to the same customer information.”
Each user will have a view of that information that is specifically designed to support that user’s particular interaction with the customer, which allows “a far better overall experience for the customer,” Colombo says. “For example, after your company has deployed this type of system, your salespeople can no longer be blindsided by an on-going customer service issue of which they weren’t aware. Even though they’re out in the field, they’ll have up-to-the-minute information about any interaction between their customers and your company that might impact the relationship between the two.”
Kalakota agrees. “Companies embracing customer asset management [seek to] maximize the value of customer relationships. Indeed,” he says, “many recent so-called marketing revolutions, such as ‘zero defections’ loyalty, relationship marketing, direct marketing, interactive marketing, database marketing and mass customization, are [simply] reflections of this more basic shift in perspective.” He explains that the shift also significantly broadens technology’s ability to interact with a customer: “Unlike traditional SFA, which only addresses the sales process, customer asset management systems enable tracking of customers through the entire customer life cycle, from initial marketing to customer service.”
Four Major Areas of CAM
Kalakota divides CAM into four major areas:
- Online sales force automation. This includes contact management, activity management, opportunity management, call reporting, lead tracking, order entry and support, customer contact and telemarketing.
- Online customer service and support. This includes account management, maintenance/help desk services and field service applications.
- Market intelligence. This includes competitor intelligence, trend analysis and supplier management.
- Marketing management. This includes performance analysis, marketing planning, sales forecasting and human resource management.
Online Sales Force Automation
“By streamlining the information flow between customers and companies, businesses are seeking to eliminate sales order mistakes and the resulting rework, increasing productivity. The result — reduced order fulfillment costs and dramatically shortened delivery cycles,” Kalakota explains.
This throws us back on classic SFA. And in SFA, “the first rule is to understand the concept of ‘us,'” Timothy McMahon, a sales and management development consultant, told DCI’s SFA Plus [http://www.dci.com] column recently. “Your greatest benefits come from the entire organization’s being able to share information back and forth. SFA can give real-time touch with the customer, which benefits everybody — marketing, finance, corporate planning, even manufacturing.” Obviously such an approach to SFA fits neatly with the principles of technology-enabled CAM.
Kalakota describes as the goal of full-integrated SFA “centrally-located employees and a remote sales force working from a distributed database of customers and prospects.” In this model, “information and work flows in all directions. Marketing may integrate marketing programs and distribute and track leads. Management may access sales activity and use the database to make strategic decisions about the market.” Elements of this may include:
- Sales process management tools, since as Kalakota says, “the most important factor in any sales automation system is the sales process. Automating a bad process leads to more chaos. The sales process must be analyzed for problems, and the system should be designed to address these problems.”
- Salesperson productivity tools, which would expedite planning and reporting of sales calls, reporting of expenses, entering orders, checking inventory and order status, managing distributors, tracking leads and managing accounts. In addition, mobile sales people can reduce sales lead times by requesting product specifications, sending product samples and updating forecasts directly from their laptop computers.
- Online telemarketing geared to targeting qualified prospects and managing demand creation, response processing, literature fulfillment and tracking sales campaigns’ effectiveness. “This requires tracking and forwarding qualified leads to the sales teams for immediate action, ranking prospects and using prompting scripts,” he explains.
Online Customer Service and Support
The need for companies to be customer-centric is rarely questioned any longer, as most realize that effective customer management is a key competitive advantage. Yet the problem of how to integrate technology with that priority provides a handsome living for thousands of people. Business technology consultants Renaissance Partners Inc., in a paper titled “Selecting Customer Support Technology: 23 Important Considerations” [http://www.supportmanagement.com/back/feb/execrpt.html] say the most important step is to “define your vision and mission.”
Doing so, they argue, will go a long way toward settling a host of issues, including service offerings, staffing requirements, technology purchase and integration and compensation plans. After all, no less a strategy consultant than the Cheshire Cat told one client, Alice, that if you don’t know where you’re going in Wonderland, why, it doesn’t much matter which road you take to get there, now does it? “Only when the support center has a clear understanding of the ultimate goal can it manage its technological resources accurately and efficiently,” Renaissance says.
Kalakota agrees. “It is a no-brainer to state that online customer service is the killer application opportunity via the Web,” he says. Some of the business justifications include:
- Lower support costs by empowering customers to solve issues independently.
- Global, anytime access to critical customer service information and forums.
- Improve service by focusing internal customer support resources on complex issues.
- Empower business partners with hot links to related online resolution information.
- Create proactive service and marketing programs.
- Seamless Web/telephony integration for priority responsiveness.
Market Intelligence
Another powerful argument for CAM is the ability to link the sales force with regional and corporate offices for greater access to market intelligence and competitor information. Using electronic commerce technology can only improve the gathering, analysis and distribution of information among the sales, customer and marketing functions, Kalakota says, to funnel market intelligence “into better customer service and service quality. Companies need to collect market intelligence quickly and analyze it more thoroughly. Good relationship management also means they need to help their customers introduce their products to market faster, giving them a competitive edge.”
Marketing Management
Firms are discovering that traditional product-oriented marketing management is not sufficient to manage the information-intensive environment. Already, traditional metrics are proving inadequate for measuring marketing activities across multiple product categories, Kalakota explains, as well as diverse distribution channels and constantly changing pricing schemes: “New information-based metrics will enable organizations to dynamically allocate marketing resources to those activities that generate the best return.”
Kalakota argues that efficiencies gained through automation and improved marketing management are interdependent and reinforcing: “Automation drives the collection of more complete customer and marketplace information, and more informed decision-making targets marketing and sales activities where they are most effective.” Introducing CAM here may take the form of providing automated sales management reports such as sales forecasts, sales activity, forecasts versus actuals and so on. Or it may include designing and managing sales territories, or analyzing marketing and sales programs by such criteria as territory, product, customer, price and channel.
