Crm Turning Customer Loyalty Into Profitability
Successful CRM: Turning Customer Loyalty into Profitability
By Bob Thompson
CEO, CustomerThink Corporation
Founder, CRMGuru.com
[pic]
October 2004
Compliments of:
[pic]
Copyright © 2004 RightNow Technologies. All Rights Reserved.
Executive Summary
Customer relationship management (CRM) gained recognition in the mid-1990s, primarily driven by its perception as information technology (IT). However, not enough attention has been given to the fundamental drivers of CRM success: strategy, metrics and the organization.
Successful CRM is about competing in the relationship dimension—not as an alternative to having a competitive product or reasonable price—but as a differentiator. If your competitors are doing the same thing you are (as they generally are), product and price won’t give you a longterm, sustainable competitive advantage. But if you can get an edge based on how customers feel about your company, it’s a much stickier—sustainable —relationship over the long haul.
The purpose of this white paper is to take a fresh perspective on how successful CRM really works. The essence is that you can dramatically improve your chances of getting an ROI from your CRM initiative by following three simple steps: 1) Understand the value your customer wants, 2) deliver that value profitably and 3) repeat.
Simplistic? Perhaps. But that doesn’t mean it’s easy. Most companies have entrenched ways of doing things, focusing on products, rather than customers. Organization inertia and self-interest are also to blame. As GE’s former CEO Jack Welch said in 2000, “Bureaucracies love to focus inward. It’s not that they dislike customers; they just don’t find them as interesting as themselves.”
In this white paper, you’ll learn why listening to the voice of the customer is so crucial to CRM success—and how genuine customer loyalty impacts corporate profitability. You’ll also find out what the latest research indicates about the gap between potential and actual
By Bob Thompson
CEO, CustomerThink Corporation
Founder, CRMGuru.com
[pic]
October 2004
Compliments of:
[pic]
Copyright © 2004 RightNow Technologies. All Rights Reserved.
Executive Summary
Customer relationship management (CRM) gained recognition in the mid-1990s, primarily driven by its perception as information technology (IT). However, not enough attention has been given to the fundamental drivers of CRM success: strategy, metrics and the organization.
Successful CRM is about competing in the relationship dimension—not as an alternative to having a competitive product or reasonable price—but as a differentiator. If your competitors are doing the same thing you are (as they generally are), product and price won’t give you a longterm, sustainable competitive advantage. But if you can get an edge based on how customers feel about your company, it’s a much stickier—sustainable —relationship over the long haul.
The purpose of this white paper is to take a fresh perspective on how successful CRM really works. The essence is that you can dramatically improve your chances of getting an ROI from your CRM initiative by following three simple steps: 1) Understand the value your customer wants, 2) deliver that value profitably and 3) repeat.
Simplistic? Perhaps. But that doesn’t mean it’s easy. Most companies have entrenched ways of doing things, focusing on products, rather than customers. Organization inertia and self-interest are also to blame. As GE’s former CEO Jack Welch said in 2000, “Bureaucracies love to focus inward. It’s not that they dislike customers; they just don’t find them as interesting as themselves.”
In this white paper, you’ll learn why listening to the voice of the customer is so crucial to CRM success—and how genuine customer loyalty impacts corporate profitability. You’ll also find out what the latest research indicates about the gap between potential and actual