'Social' CRM rethought part 2 - the customer experience

September 9, 2013

Dyslexia mode

Summary:: The customer experience is a term that has been picked up by many brands. Many see it as a substitute for the broader panoply of CRM. that's a mistake. Here's why.

In this second part of the 5 part series, Paul Greenberg dives into the emergence of the customer experience element in 'social' CRM. Enjoy. In part 3, due for publishing tomorrow, he looks at the biggest (not bigger) picture. (See part one - ‘Social’ CRM rethought (part 1) – a stake in the ground moved.) [divider] [/divider]

Let’s now look at the next “phase change” (and ridiculous discussion) that seems to be in the moment. That would be that customer experience is a substitute for CRM.

In reality, it is once again, a core principle of CRM, not a substitute for CRM. Hell, when I wrote CRM at the Speed of Light, my first definition ever in the 1st edition in the introduction (page xvii) was “CRM is a complete system that… provides a means and method to enhance the experience of individual customers so that they will remain customers for life…” There was more to it but this was the key phrase. Plus, it isn’t a bad definition even now – and that was written in 2001. I doubt I was the first to express that.

What is different now, is that it is becoming a ubiquitous principle (though it isn’t quite yet) for customer facing business thinking and activity. Anecdotal evidence shows that we are seeing more and more hires with titles related to customer experience (VP of Customer Experience et. al). In fact, recently, a company that I respect a great deal, Walker Information, in an article written for CRM Magazine by Patrick Gibbons, identified seven customer experience focused jobs that are starting to gain traction.

We are seeing a lot of CRM personnel involved in at least the discussions around customer engagement strategy and improved customer experience. We are seeing technology vendors, notably Oracle, distancing themselves from CRM conversations though they still sell CRM technology. We are seeing other vendors notably salesforce.com embracing customer focused thinking with a renewed vigor and while not denying CRM, if you look at their messaging they don’t really talk about it except in reference to their stock symbol. Minimally, these are vendors involved in thought leadership around customer experience (SAP book on it, etc.).

There are multiple reasons for the emergence of customer experience as something that some see as competitive with CRM. Among them they are:

A perception of CRM as a failed strategy and/or an expensive technology. However, there is a recognition that a core tenet of CRM, a desire to do something customer-facing, is not only still valid but necessary. “They” just don’t want to associate it with what they see as an opprobrious acronym – C…R…M. I can spend time rebutting that, but at this juncture because this isn’t the purpose of this post, I won’t. Go with it, if you want to be that way. Just remember, an $18 billion industry that never really declines is not exactly an indicator of failure. Get it?
A perception of CRM as a technology and a system, but not a strategy or program per se, which has persisted from the beginning of time. I think this was a Neanderthal strategy to stop the encroachment of Cro-Magnon man on their territory. Okay, maybe not. However, at this point, this perception not going to be overcome – no matter how much we try. I give up officially on that one. If you want to see it as a technology and system, I won’t argue. Let’s just assume that we are all in the business of developing customer-facing (or customer-focused or customer-centric or whatever you want as long as it has customer- as the first of the hyphenated words) strategies and programs. That takes care of all proponents of all these different acronyms. (You do know I’m mocking them in a lightweight way, right? Not a haha funny way though)
Because there is an attempt to create a customer experience management (CEM or CXM) “market.” While CEM/CXM is a valid business science that intermeshes with CRM and takes a somewhat different approach for the ultimately same objective, it is not an independent “market. CEM, as a technology market is a subset of the CRM market focused primarily around customer analytics, customer feedback and customer service. There is a reason that the CEM technology vendors contact CRM analysts a lot. The revenue opportunity lies in the CRM market. However, to be fair, and clear, as a management science, CEM/CXM actually has existed longer than even CRM has. And to be even clearer and fairer, there are many who think CEM is a market - and a big one. Here's one compelling case for it as an independent and big market, though not nearly as big as CRM. :-)

All I can do is explain this.

I don’t expect the practitioners of CEM/CXM to agree with this. Nor do I think they need to or should. They have a life too – and I’m sure a series of reasons and arguments for their position. What I do expect is that this provides some information as to the likely reasons why many CRM practitioners and vendors are moving away from using the term CRM – and why that truly doesn’t matter.

Customer experience is a key piece of thinking and has a key set of programs and actions associated with it that do what CRM and CEM/CXM want to do – provide a customer experience which has a mutually beneficial outcome for both the customer and the company.

Tomorrow, I look at the biggest picture. It's not as pretentious as it sounds !!
(see: 'Social' CRM rethought part 3- the biggest picture).

End note: CRM at the Speed of Light is now in its fourth edition.