Media Room

Features and tRends

(December 2008)

Maximizing Your Company’s Return on Investment (ROI)
A look at Customer Relationship Management (CRM) and
Return on Customer (ROC)

ROI, CRM, ROC, LOL and OMG . . . we live in a world of TLA (three letter acronyms).

Today’s CRM acronym for customer relationship marketing/management refers to the multitude of software products used to support customer contact processes and data management. CRM gathers and stores information on current, prospective, active and inactive customers that can be accessed and updated with transactions by company employees in a variety of departments such as marketing, sales and customer service. Multiple channels of customer interaction can be captured and a simple click on a link can produce a qualified lead immediately transferred to your inbox.

Wow! Technology is great! However, if you live and die by technology, you’ll just be another on the list who hasn’t quite mastered the rules of customer engagement. To be successful with CRM, you must involve your customers, inviting them into a two-way dialogue. They talk, you listen (and your software performs).

With that said, let me introduce you to another acronym—ROC, or, return on customer. This past summer, we attended a conference in Atlanta and were totally caught up in a keynote session with Martha Rogers, PhD and founding partner of the Peppers & Rogers Group. Ms. Rogers is an expert on customer-based business strategy.

In short, Ms. Rogers explained that no matter how great your product or service is today, tomorrow it will be a commodity, and tomorrow will come faster than you think. No matter the size of your company or whether you are a manufacturer or service firm in today’s technology-augmented environment, you need to learn how to harness the power of your customers and your employees…

Placing value on the customer point-of-view shakes up the traditional business model and introduces the concept of ROC, rather than focusing on the traditional ROI (return on investment.) Shifting to ROC means you need to have “customer memory.” You must remember, interact and react with your customers to create long-term value.

Listen to what your customers are telling you, use it and act on it. Look at every interaction as an addition to the customer lifetime value. Make your customer interactions memorable, and experiences that they can’t get from anyone else. Become customer-centric.

Be innovative, creative and focus on the customer rather than your product. Prepare all brand communications including advertising, PR, Web site content, brochures and direct mail copy with a strict focus on your product or services’ customer benefits. Demonstrate customer value rather than company value.

When you’re looking at your ROC, be practical. Understanding industry standards is great, but what’s most important is to evolve your own statistically relevant standards and benchmarks. Set your goals based on previous campaigns rather than industry standards. Grow your understanding of the customer response. Identify the “who, what, where and when.” Doing this will allow you to find out how customers create their own value and how you can engineer change to focus on the customer

Consequently, CRM and ROC go hand-in-hand. As a business professional in today’s hyper competitive world, you know that you have less control over the buying process. You’re also aware that customers want immediate gratification with shorter sales cycles. Rather than “selling” to the customer, your job is to help the customer buy. So, get your dialogue started quickly and keep communication open. Focus on the customer instead of the product and the customer will focus on the product for you!

Relate your brand to the customer but remember that the customer owns the conversation. You are there to answer questions and demonstrate value, which results in mutual value. Engage your customer and build a new value of trust. What’s more, your CRM software can capture each customer’s action and reaction throughout the entire dialogue.

Paul Greenberg, author of The Speed of Light: Essential Customer Strategies for the 21st Century suggests that you think of your markets as human beings rather than demographics. As you improve human interaction in the business environment, you and your customer are creating mutually beneficial moments of engagement.

CRM requires organization and a comprehensive strategy first and foremost. Work through the essence of your products and services and understand your “markets.” Strategize how you want to persuade your customers to buy and how you can help them learn. Think day-to-day, short-term and long-term. Develop specific rules for measuring, tracking and monitoring success.

Part of getting “CRM-ready” is selecting the single best technology/system to track individual and company customer activity across multiple channels. It’s an investment, so take time to review multiple systems and engage users from within the company for their buy-in and support for cultural business changes.

You want to know as many details about your customers as you possibly can. Develop a clear understanding of how CRM software enables you to identify, engage and measure your customers across all of your business channels.

Start simply and grow customer detail over time. Work with your software provider to develop best practices, share your short- and long-term strategy, and to determine criteria for creating customer profiles. In addition, clearly define each data point and make the definitions easily available for all to use.

If you’re not ready to make the CRM software leap, you can still implement ROC and some CRM best practices. Begin by collecting customer information and developing relationships. Become immersed in helping the customer learn and buy. It’s never too early to engage in best-in-class customer relationships!

Looking for more information about CRM? Contact Steve Kleber at 770.518.1000 or by email at sk@kleberandassociates.com.

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