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Understand, engage, deliver: Which is most critical for customer retention?

5th Jun 2013
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Through 2018, senior executives will be focusing on customer experience and CRM for business success with customers determining the winners according to satisfaction ratings and sales. 

But what is the critical factor businesses should focus on to achieve this success? At the Gartner Customer Strategies and Technologies Summit in London this week, analysts Gene Alvarez, Jim Davis and Ed Thompson went head to head during a keynote session to convince the audience that understand, engage and deliver is most important, respectively.


“Earn your customers for life by understanding them better because without understanding, marketing is inappropriate and ineffective,” says Jim. In the 1950s, he explains that customer insight was limited and marketing very generic but now, despite moving into an area of personalisation thanks to cookies and the ability to provide content in time, the level of customer understanding hasn’t really changed.

The problem organisations now face is in getting to grips with Big Data, he says, advising businesses that they would do well to focus on the variety aspect of Gartner’s Big Data definition, which also includes volume and velocity. And of the types of customer data categorised by the analyst house (destructive, relationship, social, attitudes, needs and satisfaction) Jim believes that it’s the attitudes, needs and satisfaction data that provide organisations with the richest insights.

After collecting this data, organisations need to store and manage the information to obtain a single view of the customer and following this, must analyse it. “How you engage and what experience you deliver is irrelevant if you don’t understand the customer,” he says.


The baton then passed to Gene who explained that whilst we are seeing an evolution in customer data, we must understand the gap between what customers want and what organisations think they want. “Acquiring customers is not engaging them,” he says. “Organisations need to interact with them.”

So how exactly should they do this? Customers want organisations to interact with them where and when they want it, and they want this to be done in a personalised way without creeping them out, he says – pointing to KLM’s recent ‘Meet and seat’ social initiative.

“Understanding your customers will help you get new customers and engage them,” he said. “Rather than focusing on engaging during just the sales cycle, we need to use our customer understanding in all aspects of the customer lifecycle.”


So how can organisations deliver this engagement across the entire customer journey? Analyst Ed Thompson explained that the world of CRM traditionally thinks of delivery as being projects, applications, benefits and ROI but with this new customer understanding, driven by Big Data, organisations need to go beyond delivery automation processes and innovate through changing the business model.

“New business models are coming thick and fast,” he explains, pointing to gamified marketing and peer-to-peer exchanges as examples.

“We’re no long talking about traditional CRM projects; we’re now using new models that blend traditional CRM activity and new digital areas. CRM consultants no longer brand themselves CRM but are now calling themselves digital. CRM is gone,” he says.

So how can organisations tie together these three factors and weave into their organisation? “Earning customers for life is effectively understanding customers so that each engagement will drive loyalty and satisfy delivery on the customer’s promise of the organisation,” Gene concludes.

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