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CRM 2.0: Myth or reality?

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12th Dec 2008
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2008 has witnessed further developments in service oriented architecture and customer experience management, whilst Web 2.0 has landed with a bang. Are we therefore on the cusp of so-called 'CRM 2.0'? And will CRM 2.0 be radically different than CRM is now?

Question in the clouds

By Tony Smith, Cognizant Technology Solutions

With the advent of SOA, Web 2.0 and CEM, among other technologies, the CRM landscape will look vastly different in the not so distant future. Or will it?

Clearly Web 2.0 in the form of wikis, blogs and other means of social networking is transforming the internet into a truly interactive medium. What’s unclear is how Web 2.0, with its ability to empower consumers to collaborate among themselves, will impact CRM as we know it.

At its most basic level, Web 2.0 is the transition from centralised to decentralised control of IT and web interaction, where users are able to determine how their virtual experience will transpire. And clearly, as social networks are playing an increasingly key role in product selection, market acceptance, communications and content consumption, companies will have less influence over customer minds and wallets.

What does this mean for CRM? First and foremost, basic CRM functions will remain critical, if not more so. At the core, companies will still need to deliver a good customer experience, provide cross-channel integration, efficient/effective sales force management/automation, robust call centre operations, results-driven marketing and campaign management and efficient customer process management.

"Social networks are maturing and some are becoming trustworthy enough to help customers to help themselves rather than having to turn to a corporate website."

As consumers become more sophisticated and have greater access to information, especially negative information, the responsiveness and effectiveness of CRM applications becomes even more critical. Problems with website usability or technical support can be quickly broadcast across the connected community. And with the perpetual decline in switching costs, small CRM issues may be magnified many fold, resulting in untold business losses.

Other CRM functions will be impacted as well. Cross-channel integration, for example, will be crucial. Users will expect to seamlessly connect from their cell phone to a website to speak live with a customer service rep. Digital native customers who have grown up with their mobile phones in hand will expect flawless service/support. Companies will not only need to keep their call centre applications in synch with the web, but will need to tie in mobile handsets and applications too.

This is, of course, having a positive effect on companies. Social networks are maturing and some are becoming trustworthy enough to help customers to help themselves rather than having to turn to a corporate website or customer service rep, with FAQs being supplanted in some part by blogs and wikis that provide support and updates.

Permutations and complexities

Marketing functions will probably be most affected. The onus is already turning to marketing and sales to ensure that proper information is communicated, putting sales and marketing in the difficult position of having to challenge misinformation spread by individuals on social networks.

Some companies are already taking advantage of the web for advertising new product launches and for collecting and disseminating feedback to product management groups. Marketing, therefore, will have to incorporate Web 2.0 techniques into campaign initiatives, embracing social networks, blogs and the like.

"The onus is already turning to marketing and sales to ensure that proper information is communicated, putting sales and marketing in the difficult position of having to challenge misinformation spread by individuals on social networks."

Moreover, 24-hour availability and global access to CRM systems will also be increasingly important. As new generations of consumers across the globe become accustomed to conducting business over any channel, anytime, anywhere they want, customer support will have to follow.

Arguably the greatest challenge will be in CRM technology, which is relatively transparent to the customer. While enterprise platforms will likely remain in use, a vast array of new applications and integration demands will emerge. CRM 2.0 platforms will need to incorporate the new social networking experience and Web 2.0-generated data.

Based on SOA and hosted services, they will need to co-exist with enterprise, on-premise applications. There will be new peripheral applications to integrate and support with new web and mobile device interaction methods. Enterprise application integration (EAI) and integration tools will be more robust and allow more seamless integration of disparate components. To the extent that this 'connectedness' is being addressed in the web itself, some of the integration and data management issues may be simplified. But for large enterprise companies a great deal of integration work lies ahead.

So, will CRM 2.0 be radically different than CRM is now? Probably not. But it will have a whole set of new permutations and complexities, and companies will still have to deliver on the promise, and the growing expectation, of solid CRM capabilities.

The bottom line is that companies that want to cross this tricky chasm will need to protect and strengthen their core CRM functions and build out at the periphery to support Web 2.0 capabilities, integrating key functions and data sources as needed.

Tony Smith is the European head of customer solutions at Cognizant Technology Solutions

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By wecandobiz
06th Jan 2009 17:26

Picture this: you use LinkedIn and have a few hundred connections, mostly buddies in former jobs. You go into LinkedIn to read what’s happening with them and connect up with the most recent joiners. But what if you could then press a button and the contact details for your whole network then move into your CRM system. As your relationship with those connections develops, your CRM system enables you to attach processes to them to ensure you achieve your objectives and no opportunities slip through the net. Neat. But best of all, all the customer records in your CRM are updated by the customers themselves! No more duff data.

This has made sense to me for sometime, coming, as I do, from six years in CRM to now run WeCanDo.BIZ, an online new business network for sales leads. When we launched in May, it was in the back of my mind that integration with CRM systems would be both simple and very compelling. Will anyone else get there first?

I’m seeing the power of a system tapped directly in to public profiles where your target market and customers will happily maintain all their current contact details, as well as telling you their likes and dislikes (this could work just as easily on Facebook, where there is way more personal information to mine than there is on LinkedIn).

It's a myth until someone does it. But once one of the CRM vendors has it, I can't imagine the others not leaping on the bandwagon.

Ian Hendry
CEO, WeCanDo.BIZ
http://www.wecando.biz

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By bretthusbands
15th Dec 2008 19:29

2.0 is the topic of individual empowerment, rather than applying the social aspect to traditional tools.

I took a stab at summarizing what I think this means here: http://www.600days.com/manifesto/

In relation to CRM the question that is forced is whether CRM makes sense from a 2.0 mindset. Most CRMs that I have seen are about sales force automation, and good at it too.

2.0 is about human relationships, this is a shift from the internal focus - and very different from the current majority market viewpoint.

Customer Service 2.0 and Customer Engagement 2.0 are entirely plausible; CRM almost by definition is about managing a sales force, and not a customer conversation.

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