How do you measure success?

27-Jun-2007

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By Neil Davey, editor

How do you measure success? It’s a tricky question. Of course the customer sits squarely in the middle of this equation. And joining him is the small matter of investment – and specifically investment in customer strategies. In essence it’s a balance of how much money you spend on customer relationship management to capture and retain the most valuable customers. But if only it were that simple, and all kinds of considerations come into play. As such, July sees us tackling one of the thorniest issues in customer relationship management, the customer business case – how organisations measure their CRM success, what they deem to be the benefit of their initiatives and how much it has cost them.

There are a lot of issues for us to chew over. Remember, the math doesn't always add up as the customers that create the most revenue for your firm may not be the most profitable - indeed, they may even prove to be the most expensive to keep. As such, measurements and key performance indicators (KPIs) are coming under the microscope first of all – in particular the measurement of loyalty and satisfaction, where Alison Bond emphasises “what gets measured gets done!” But what about measuring customer value? It’s a major area of confusion for firms, emphasised by the fact that the term ‘customer value’ returns almost three times as many hits as ‘customer relationship management’ on Google. With the development of customer value metrics of growing interest, we’ll be turning our attention to theories of customer valuation as well as strategic concerns over the nature of such metrics.

But of course it’s not just about the customers – it’s also about the investment in getting and retaining them. As such, we’ll also be investigating the costs of implementing CRM technology, providing case studies of companies that have spent the cash and asking them whether they saw a return, and exactly where they saw it. We’ll also be highlighting what you should be costing into a CRM programme for those that are just starting out along this windy road.

But convincing yourself that the investment is worthwhile can often only be half the job – there’s also the CEO, the CFO and the board to think about! What does it take to get your ambitious plan for CRM investment past these guys? We’ll be helping you out with our dedicated look at writing business cases, touching not only on the practical side of drawing it together in the first place, but also the political considerations that come into play. We will be speaking to sources that have been there, done that, and survived to tell the tale.

But first up we get our teeth right into the issue with a fantastic strategic overview by Jennifer Kirkby, ruminating on the question of the business case for customer relationship management, and a look at the related technology issues by Stuart Lauchlan. With all this and more to come, one thing is for sure – we’re really getting down to business in July.