CRM: Back for Another Round - InformationWeek
IoT
IoT
Software // Enterprise Applications
Commentary
11/1/2017
08:00 AM
 Will Bryant and Ren Carter, Point B
Will Bryant and Ren Carter, Point B
Commentary
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CRM: Back for Another Round

New capabilities in CRM and digital marketing solutions require a strategic reassessment.

Most companies know the value that smart customer relationship management (CRM) can deliver: increased sales, higher customer acquisition and retention, and more effective marketing based on better data. CRM was one of the early Software as a Service success stories based on price and convenience.

Because of that compelling business case, CRM outsourcing has increased over the last 10 years, from 12% in 2008 to over 85% in 2017. However, the raw numbers don’t capture the range of outsourcing options and the evolution of the solutions.

Cloud? Which cloud?

Nearly every company is already dealing with multiple cloud solutions to manage and act on their customer data. From clickstream data to demographic enrichment to digital marketing and even artificial intelligence, the omnichannel customer experience involves connecting a dizzying variety of cloud and on-premise applications.

To address this, the mega vendors are making CRM systems the core of digital media platforms that integrate nearly every aspect of marketing and customer contact. They are achieving this through a combination of new product development and acquisitions.

In spite of marketing hype, there are still significant gaps and differences in functionality in the mega vendors’ offerings. This has left an opening for specialized, best-of-breed solutions. The range of required capabilities along with very different pricing models means that you may face trade-offs between best-of-breed vs. single-vendor solutions and cost vs. convenience.  

With some thoughtful planning and clear self-assessment, your company can find the right solution and leverage its full value. Here’s how.

Be clear about your starting point

Every organization has strengths and weaknesses based on history and culture. Be realistic about your near-term needs and capabilities, especially if you are just getting started. The market is changing incessantly and predicting the available solutions, or even your requirements, two years out is nearly impossible. You need to define an approach that builds on your strengths and addresses gaps through a mix of choosing the right partners and building internal capabilities.

Control the complexity

The growth in capabilities and new requirements shows no sign of slowing, so you need to have a CRM strategy that can adapt to change without you losing focus on business results.

Complexity increases rapidly with the number of vendors. Overlapping capabilities need to be sorted out. Integrating data-intensive applications requires significant coordination and project management to ensure your business needs are met. Bear in mind that even single-vendor solutions are often made up of poorly integrated parts.

Because diminishing returns set in quickly, you should pick one or two core vendors based on your business requirements and have a clear process for evaluating the cost and effort to support additional tools against their value add. Even once your system is up and running, managing your core vendors and keeping up with the rapid advances in functionality will be a full time job.

Invest in essential internal capabilities

Some specialized skills are very difficult to hire and retain, but there are critical skills that you need to keep in house to hold the external parties accountable for the results. For example, evaluating the outcomes of campaign plans and analytical models. This may mean hiring a consumer engagement specialist to drive CRM strategy and work directly with your vendors.

Strong in-house management of both your internal stakeholders and vendors will also improve data quality and ease integration.

Assess potential conflicts of interest

If you’re outsourcing an end-to-end digital marketing solution with a single vendor, this vendor will be tracking, measuring, and analyzing its own marketing campaigns based on its own work. Consider how you will manage any potential conflicts of interest or unintentional bias. The right pricing models, metrics, and other tools can help manage this conflict of interest.

Be Informed

The nature of cloud CRM solutions doesn’t allow for customized solutions, so expect to pay for unused or duplicate functionality. Furthermore, the pricing models vary widely. Knowing the details such as number of customer records, users, and data volumes will allow you to make an informed choices and avoid costly surprises.

Outsourcing can be a smart way to leverage the latest digital marketing solutions quickly and cost-efficiently. With proper planning and controls, it enables you to achieve breakthrough improvements in your CRM and campaign management performance. The more efficiently you manage the interrelationships, the freer everyone will be to focus on doing their best work.

Will Bryant
Will Bryant

Ren Carter
Ren Carter

About the authors:

Will Bryant and Ren Carter are senior associates with Point B, an integrated management consulting, venture investment, and real estate development firm. With over 20 years project management and professional services experience, Bryant has successfully completed enterprise information strategy, data architecture, and advanced analytics projects worldwide. Carter is an outcome-focused business professional with two decades of experience partnering with Global 1000 clients to plan, market, and deliver technology-enabled business initiatives.

The InformationWeek community brings together IT practitioners and industry experts with IT advice, education, and opinions. We strive to highlight technology executives and subject matter experts and use their knowledge and experiences to help our audience of IT ... View Full Bio
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