Communication

The End of Unilateral CRM – Taking Into Account The Complexity of Customer Relationships

Published on 11 August 2016 | Author Stefan von Lieven

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The Customer Relationship Management – CRM – should control the relationship between customers and companies. Increasing customer expectations and the growing speed in which customers interact substantially affect the CRM. Another important trend beyond data understanding and speed of analysis in interactions is challenging companies. This type of relationship between companies and consumers is significantly more complex than a pure classification into “customer buys” and “customer does not buy”. Companies must develop a real understanding in order to fulfil the different expectations and not lose customers in a complex competitive situation through a unilateral or incorrect understanding.

In many companies, CRM means to collect data from which information on the consumer behaviour can be gained (brand preferences, willingness to pay etc.) and to create different buyer profiles from this data. Customers are often only seen as buyers who should be motivated to a transaction by means of different measures. For some customers, this is indeed the right approach. They expect a rational, pragmatic seller-buyer relationship from a company. However, this is not true for all customers. There are those who see themselves as partners of a company and would like to interact with it. Other customers have internalised the old principle of “the customer is king” in a particularly strong way and see themselves as masters over the company which is to fulfil their requests and provide the deserved attention to the customer. Others have fallen for a company in such a way that they are easily excited, defend the company against critics and are happy to be led by the company. These are only a few examples of possible relationships which customers can expect from a company.

Self-awareness Is the First Step

Companies often focus their marketing measures only on one relationship type, especially on the transaction-focussed seller-buyer relationship (e.g. in companies with strong love brands) or on the fan relationship. However, this unilateral customer relationship often results in the frustration of users who wish for other relationships. A user who just wants to buy cheap, quality running shoes will easily be annoyed when a sporting good manufacturer treats him like a marketing evangelist and communicates completely irrelevant communication. The first and most important step to a multi-level CRM approach consists in the recognition that customers actually wish for different relationship types and that these relationship types mostly go beyond the present marketing-oriented understanding in the CRM.

After this acknowledgement, the first step lies in categorising the different possible relationship types. There are a number of approaches to do this. Researchers and marketing/CRM experts Jill Avery, Susan Fournier and John Wittenbraker have suggested a categorisation according to 29 relationship types in their study based on the characteristics of interpersonal relationships. Relationship types were labelled e.g., as neighbours, spouses, acquaintances or one-night stand. Generally, the shaping of the category is flexible and does not need to follow a fixed approach. Significantly more important is the understanding that the relationship type cannot exclusively be differentiated according to consumer behaviour but also according to psychological factors, emotions, satisfaction, non-commercial requirements (e.g. search for bonding or execution of authority).

Relationships With Your Own Customers

In order to determine which type of relationship your own customers wish, you will first need to find indicators for each relationship type. These could include e.g., certain statements which customers use about the company in social media discussions, but also in direct contact with the company, e.g., customers who say they “love” a company. Via data mining you can determine whether relationship types correlate with certain combinations of customer attributes. When you capture the indicators or data from which the indicators can be read via analysis technologies at all available sources (social media, direct customer contact, feedback/surveys, self-service data, response data from online marketing, socio-demography, purchase behaviour, etc.), you can then categorise your own customers.

In any case, it is important for a company to be open to unexpected results which could force a rupture of your old habits, possibly even a correction of your self-image. Maybe a company which has so far understood itself as a friend of its customers and has positioned itself accordingly, discovers that most customers do not actually wish this friendship. The consequences from this locating of your own customers will have to be that each customer must be approached individually with the right marketing measures according to his relationship type, context of use and his requirements in general. Content, frequency, design and timing of digital dialogue measures will all have to be individualised. The process of continuous categorising of customers, the individualised execution of marketing measures based on this and the conversion of the results of these measures into the categorisation of customers is only possible through the use of realtime marketing automation technology which responds to changes of the indicators in real time.

Conclusion

Many companies today focus their CRM on a primary transaction-orientated seller-buyer relationship with the customer. The complexity of the customer requirements according to their relationship with the company or brand is only insufficiently considered. In the future, it will become vital to manage more complex and emotional relationship types and to correctly classify customers. All relevant relationship types will have to be identified and indicators (e.g. statements in social media posts) which allow the classification of customers into relationship types will have to be modelled. Taking into consideration the relationship type of each individual customer helps to make the marketing and service communication even more customer-centred and to address the true motives. The categorising of customers according to relationship types should be transferred to an automated and continuous process which responds to changes to the indicators in real time.

Sources

Harvard Business Manager 09/14: Das Geheimnis guter Beziehungen


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artegic AG provides strategic consulting, technology and business services for online CRM and dialogue marketing via email, RSS, mobile and social media. artegic's online CRM technology ELAINE FIVE, which is used for the sending of over 2.7 billion messages monthly enables marketing automation based on self-sharpening analytical profiles. artegic's customers include, e.g. Rewe and PAYBACK.

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