Marketing is resilient. From the days of mass marketing to today’s highly personalized channel-based marketing, the discipline has evolved to meet the needs of an ever-changing marketplace.
Marketers more than ever must listen closely to their customers and overcome product and channel silos to build loyal, profitable customer relationships. However, overcoming these challenges is not trivial.
What is a “silo”? It was not long ago that direct marketing came to the forefront as the vehicle for organizations to speak directly to customers or prospects. Leveraging traditional mail and call centers, direct marketers focused activities on groups of customers or prospects likely to be interested in receiving their message.
As organizations grew and their mix of products and services increased, they organized corporately around these disparate product offerings. This led to the creation of product silos, which are groups within the corporation working in a vacuum on their specific product. These product silos created a challenge to corporate direct marketers: All direct marketing efforts were product-specific and failed to recognize the entire customer relationship.
Fortunately, two disciplines, data warehousing and data mining, offset the challenge by providing marketers with a complete view of their customers. Armed with this holistic view, direct marketers began to manage customer relationships across the organization, forming the discipline of database marketing.
Database marketing forged the concept of “customer-centricity,” which means putting the customer at the focus of marketing activities, instead of a product. This concept was revolutionary. But with revolutionary changes come major obstacles. Overcoming product silos and the shift to customer-centricity required shifts in organizational culture.
Proliferation of Channel Silos
Though the problem of product silos was diminished with database marketing, new challenges emerged. The first was the evolution of the role of marketing. A philosophy evolved, stating that every customer contact represents a marketing opportunity. For example, it is easy to remember when inbound call centers were used strictly for customer service. Now, call center representatives are armed with call scripts and other technologies that empower them to help resolve customer service issues while providing intelligent, targeted marketing content to increase customer profitability.
The proliferation of the Internet and e-mail presented yet another challenge. These two channels transformed the manner in which organizations and their customers do business. In fact, the emergence of these two channels is analogous to the advent of the ATM within banking: Customers now have on-demand access to organizations and can take responsibility for managing their own transactions. These channels, and the push for organizations to focus on producing marketing messages at every interaction, revealed complexities on two axes: managing both inbound and outbound marketing messages while concurrently managing batch and interactive dialogues.
Because each channel within an organization is unique and requires specific technologies for delivering content and capturing of related behavioral information, companies invested in customer relationship management tools to manage each of these channels. Fortunately, vendors that supply CRM tools have strong offerings to satisfy marketplace requirements for channel-specific, customer-facing applications.
These CRM tools proved effective at delivering the relevant content to customers at the channel of interaction. To achieve full effectiveness, however, these tools require access to a channel-specific database and a set of business rules that define the customer dialogue. These databases create enormous opportunities for the database marketer; the behavioral data captured at each channel (e.g., click-stream data on the Web) provides deep insight into a customer’s motivations and needs.
The massive amounts of data and the unique dynamics governing the customer dialogue at each channel encourage the creation of disparate, channel-specific marketing teams. Traditional direct mail and telemarketing developed techniques that took years to refine and systematize. These techniques are applicable across all direct mail and telemarketing programs.
However, customer behaviors and the respective data captured from dialogues at other channels are different. The dynamics at a Web site, which is completely automated, is different than the dynamics at a call center, which is highly personal. In fact, the dynamics at every channel are unique and the techniques for analysis and intelligent channel management are evolving.
In addition, the sophistication of each channel leads to the need for channel-specific marketing specialization. For example, Web marketers must understand all facets of Web content management including on-site and off-site media placement, visitor identification/authentication and click-stream analysis. The e-mail marketer must be cognizant of privacy issues, spam, return handling and delivery throughput. Call center marketers must understand the dynamics of customer service, intelligent call routing and load balancing. Similar peripheral knowledge and dynamics are present within any channel-based marketing group. Marketers must specialize within a channel if they expect to gain the depth of knowledge necessary to manage customer relationships within their domain.
This specialization of channel-specific marketing groups presents CRM challenges for the customer and the organization. Few things frustrate a customer more than an experience differing in quality and content from one channel to another. Disparate CRM strategies at each channel can lead to highly disjointed customer experiences, as these channels have no memory or recognition of the customer relationship and its interactions across channels. For the organization, the frustration lies in its inability to centralize its rules of customer engagement, to view the holistic customer relationship and to deliver consistent communications across channels.
Managing the Holistic Customer Experience
The question marketers face is: How do we overcome the proliferation of channel silos as we did with product silos? Though we are still converging on the complete answer to that question, there are a few places to start.
First, appreciate the power and capabilities of your CRM infrastructure. Unique products require specific domain knowledge and technologies; the same is true for unique channels. You should fully leverage each channel’s unique capabilities.
Web sites enable the organization to place enormous amounts of content and information in front of their customers, and they provide insight into each visitor’s needs by tracking the visitor’s behavior on the site. Call centers provide the most interactive dialogues possible, and call-scripting drives convergence on a customer’s needs and preferences. Opt-in e-mail provides a level of personalization and timeliness not available in traditional mail, and with its inexpensive cost of delivery and relevant content to the recipient, it enables organizations to frequently push their messages to customers. A similar proposition can be generated for each channel.
Therefore, to maximize these channel-specific capabilities, install best-of-breed customer-facing applications to manage your customer dialogues. These applications include content delivery tools on the Web, call-scripting tools for the call center, sales force automation tools for your sales force and e-mail personalization engines.
The second step in overcoming the challenges of channel silos involves putting the customer at the center of your marketing strategies. We live in a customer economy. Competition and pricing pressures increase every day. Brand loyalty, though still prevalent in some industries, is decreasing. Customers ask organizations to exceed their expectations and are less loyal. In order to fully manage your customer relationships and maximize the profitability of your diverse customer base, it is critical that your marketing efforts revolve around the customer.
We must not only view our customers across products, but we must holistically view the customer relationship across channels. Armed with this view, marketers must create global CRM strategies that provide a continual, cross-channel dialogue and define the customer experience. By doing so, marketers begin to shape a seamless framework around products, channels, customers and organizations, extending the database mantra as one extends his hand in friendship.
