MRM Partners CEO Pam Larrick went to Cannes, France, both to praise CRM and bury it.
Addressing attendees yesterday at the 50th International Advertising Festival, also known as Cannes Lions, Larrick cited examples of CRM's failure, success and ways to harness its power.
“CRM failed because it was purely a technology play,” Larrick said in a speech provided to DM News. “It was only about the technology. What was missing in the exchange was trust.”
The 1990s were flush with headlines that promised automation of the exchange between the buyer and seller. Billions of dollars later, companies learned that CRM was no magic bullet.
Though the first CRM is dead, the new incarnation is already out the door, Larrick said. CRM now starts and centers around the customer, understanding his or her needs, desires and motivations.
“Some direct marketers say, 'Let's go back to direct marketing. We know that worked.' But we can't go back,” Larrick said. “CRM goes far beyond direct marketing.
“Direct marketing is just a part of our larger, more powerful offering,” she said. “The CRM universe spans direct marketing's customer acquisition, cross-sell, upsell, retention and long-term loyalty. But CRM also advances the entire buying experience, the buying cycle, in clearly new ways.”
She cited the case of a man buying a Mercedes car. The first-time buyer has different needs, desires and questions than the four-time repeat customer.
“If you don't address those distinct needs,” Larrick said, “you won't earn his trust because you haven't been relevant to what motivates him.”
The good news is that many companies worldwide are starting to understand this. More firms are appointing regional and global directors for CRM or relationship marketing. They are also budgeting significantly for CRM.
Larrick cited examples of Heineken and its “i-Club” SMS sign-up service for young adults; Durex's use of its British site to create a dialogue with condom buyers; and Dutch-owned Rabobank's custom magazine, “U,” that published 435 distinct editions for each of the Netherlands' neighborhoods.
“[But] the era of the top-down direct marketing wholesale hard sell is over,” she said.