December 11, 2000

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Best Ways To Serve Customers

By Rick Whiting

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one are the days when a merchant, whether the town butcher or the local tailor, knew his customers personally--the cut of meat they preferred, or the style of clothing they liked. Today, brick-and-mortar and online businesses are more removed from their customers than ever before, so understanding their wants and needs is more challenging.

To uncover, understand, and meet the needs of their customers, businesses can--and should--take advantage of the wide range of business-intelligence, customer-relationship management, and customer-service software available today.

First on any list of must-have technologies is tools for collecting customer data, either from point-of-sale, billing, call-center, or other operational systems, or from Web sites and online sales systems. Vendors such as DecisionPoint, Informatica, and Sagent offer software that pulls data from operational systems and loads it into data warehouses or data marts for analysis. A growing number of vendors, including Accrue, Interelate, WebSideStory, and WebTrends, offer tools and services for gathering clickstream data from Web-site logs.

Of course, all that data is useless unless it's analyzed to understand customers' buying patterns and to spot trends. Reporting and query tools can help with the basics, such as determining a product's sales by region, season, or some other dimension. Online analytical processing software sold by vendors such as Cognos, Hyperion, MicroStrategy, and SAS Institute provide a way to perform more in-depth, multidimensional analysis of customer data.

Software vendors also offer an increasing range of packaged analytical applications focused on vertical markets: NCR Corp., for example, sells tools for analyzing customer-churn rates in the telecommunications industry or for identifying a bank's most profitable customers. Online companies also are discovering the need to closely track their customers' experiences on their Web sites, such as determining whether potential customers have trouble navigating the site, says Patricia Seybold, CEO of the Patricia Seybold Group, a research firm.

Armed with a better understanding of their customers, companies must then act on that knowledge. This is where they should enlist CRM and personalization applications. CRM applications from vendors such as Nortel Networks, Oracle, PeopleSoft, and Siebel Systems let companies manage all aspects of their relationships with their customers, from tracking initial sales leads to managing post-sales customer service and call-center activity.

CRM may be one of the best ways to gather information about customers, because it reaches out to all contact points--Web, telephone, E-mail, and face-to-face--and brings that data into a centralized data repository. It makes sure that customers are treated the same, regardless of how they're interacting with the business. If a customer calls into a call center with a service complaint, for instance, the call-center representative could see that the customer has a large order pending and expedite the service to keep the customer happy.

For Internet businesses, personalization tools from vendors such as BroadVision, Personify, and Vignette provide a way to personalize a company's interactions with its customers, including tracking customer purchase histories and using that data to make buying suggestions. Vendors such as Brightware, eGain, and Kana Communications focus specifically on the customer-service needs of Internet businesses.

To enhance CRM efforts, companies should design their systems in such a way that customers can play a role in managing the customer-supplier relationship, Seybold says. CRM systems, for example, should provide customers with a way to update their profiles or check the status of their orders.

All this sounds like a lot of technology to acquire. To make things easier, an increasing number of vendors are delivering systems that combine many of these functions. Software from Broadbase and E.piphany, for example, combine many data analysis, CRM, and online-marketing capabilities. With such a system, the task of analyzing customer data and using the findings to provide personalized communications online and in the real world is automated.

Some E-commerce software, such as applications from Blue Martini Software, can also analyze the data generated by operational applications. Whatever the approach, it's clear that in today's customer-centric economy, companies need to invest in technology that will optimize their relationships with their customers.

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Illustration by Tom Nick Cocotos

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