Is Customer Engagement the new CRM?

One of the big multichannel marketing trends is the renaissance of CRM. No longer is this limited to paper-based mail programs, but sophisticated data-driven programs that integrate tailored content across multiple channels. The challenge for many businesses is how to evolve from a transactional view of the customer to a behavioural view to improve the customer experience, as well as build and maintain customer loyalty.

Whilst the core principles of marketing have not fundamentally changed over time, the marketing world in which we work keeps getting more complex. The most notable change is the shift in consumer influence and power; you only need to look at the growth in peer reviews, Facebook, Twitter and concepts like Groupon to see this power shift. But not only that, businesses who did not traditionally use direct marketing techniques (as they had little or no customer data) are now keen to learn how to harness the power of data in the digital space and how they too can start to build direct customer relationships.

This has led to more potential contact points with customers, more media channels for us to play with and greater opportunities to start and build two way communications. As a result more businesses are seeking to engage with their customers. But who should you engage with and how? One of the trends that we’re seeing is the move from CRM to Customer Engagement. Is this the same concept repackaged or is there a fundamental difference in these concepts?

Both concepts promise increases in customer loyalty and profitability based on the delivery of continuous value to customers. CRM enabled businesses to establish dialogues with customers using new technologies to facilitate these relationships. But businesses were initiating and driving the conversations, not the customer. With the advent of social media applications in particular, the power of the customer has grown. They are now more informed and able to express themselves. They can seek out advice and opinions from other customers that businesses have little or no influence over. These changes, coupled with advances in data processing technologies have led to strategic shifts; a move from relationship plans with customers to engagement plans with customers. We have gone from mass marketing to two way relationships to two way engagement.

But at the heart of it engagement is fundamentally no different to CRM; it is still about the use of technology, data, processes and channels to drive value. The difference is in the detail. Forrester Research defined four key elements that need to be present for customer engagement to work.

  1. Involvement – CRM has brought in technologies, techniques and best practices to attract and communicate with customers.
  2. Interaction – The need for greater automation backed by tried and tested decisioning techniques is now a must have.
  3. Intimacy – Achieved through the creation of true two way conversations. This can only come about through greater interaction with customers.
  4. Influence – The greatest change will be allowing customers to proactively engage with your business and not only that, being able to react to them.

At the moment many businesses have only just touched on social media tools as a place to list or present the latest company news or views. Businesses need to embrace social media and new processes to manage a true two way communication for customer engagement. It is imperative to create and maintain a single view of your customer. This is a critical strategy because today’s customers often interact with your business in a variety of ways that involve more than one touch point. It is vital that you understand how your customers behave across all channels, at each and every touch point, and that you also understand each customer’s value to you. To get that single customer view, consolidate all customer data in one place regardless of source.

Start to build rich customer profiles to encapsulate your customers’ needs, behaviours, and ways they want to interact. Personalise and localise your customers’ journey by delivering relevant experiences based on what you know about your customer. When you focus on delivering the most relevant content that you can, you get to the real objective, which is maximising customer engagement, revenue, and, hopefully, lifetime value.