Crmmedia crm1010

When youre in the vision business, the goal is to see everything better. Including improvement.
Global benefits provider VSP Vision Care always looks for ways to enhance its world-class customer care through VSP Peak ServiceSM to its 55 million members. By implementing Verint Workforce Optimization, VSP gained deeper insight into its performance and reduced call handle times while saving $3 million in the first year alone. Thats Intelligence In Action.
TM
See case studies at www.intelligenceinaction.com.
Rob Lynch CEO, VSP GlobalSM
Copyright Verint Systems Inc. 2010. All Rights Reserved Worldwide.
Contents
Vol. 14, No. 10
Do you have any questions?
H se ave ne en you pri w our ce s?
IMPLEMENTATION SUCCESS METER
you Are ing with havficulty u? dif men the
an I be of ssistance?
20
26
u lp yo he ur Doeed yo ion? n ith ct w ele s
Would you like to see todays specials?
FAILURE
SUCCESS
32
12
42
COVER STORY
20 Take the Initiative

FEATURES
Proactive CRM enables organizations to cut costs, minimize risk, protect the brand, and improve customer experiences. BY LAUREN MCKAY
26 How Can I Help U? 32 Anybodys Bot
Chat technology is popping up on proactive Web sitesalong with conversion rates. BY JUAN MARTINEZ Can a virtual agent help customers navigate the ever-increasing complexities of the online world? BY KOA BECK
COLUMNS/DEPARTMENTS
4 Front Office
Being more proactive is not merely a nice thought. Its essential.
BY DAVID MYRON
INSIGHT
12 A Succession of Failures
Analysts explain how CRM users can avoid costly miscommunication.
REAL ROI
37 A Catalog of Contacts
With Unicas marketing software, Sears Holdings gains some newfound customer intelligence.
14
ON THE SCENE: CRM EVOLUTION 10
6 Reality Check
A quarter-century in CRM.
BY BARTON GOLDENBERG
A CRM Showdown in Times Square

Four industry executives share the same stagebut not the same views.
38 To Predict and Serve

Predictive analytics helps a police department make better use of limited resources.
8 Customer Centricity
Enough with the buzzwords and hype. Its time to start doing.
BY LIOR ARUSSY
14 CRM on Twitter
The #CRMe10 tweetstream, drawn from this years CRM Evolution event.
40 A Healthy Dose of User Adoption

UnitedHealthcare overhauls its CRM program to embrace an on-demand solution that users will actually use.
16 The Crash of Google Wave

The search-engine giant beaches its innovative collaboration engine.
10 The Tipping Point

You can now enhance customer intimacy in ways that didnt exist until very recently.
BY CAROLYN HELLER BAIRD
18
MARKET FOCUS: HEALTHCARE
A Prescription for Social Media

How to participate in social networks without compromising security.
41
SECRET OF MY SUCCESS
Something Borrowed, Something Blogged

Marrying a variety of voice-ofthe-customer approaches, Davids Bridal tries measuring sentiment among social mediasavvy brides.
42 Pint of View
Delivering (proactive) service with a (secret) smile.
BY MARSHALL LAGER
19
REQUIRED READING
Slowing Down Your Social CRM

A co-author of the recent book The New Handshake on why relationshipbuilding takes more than a tweet.
www.destinationCRM.com
CUSTOMER RELATIONSHIP MANAGEMENT | OCTOBER 2010
FRONT OFFICE
Act or Be Acted Upon
H E N youre putting out fires on a
regular basis, its too late to think about fire prevention. Unfortunately, thats the position many executives believe they are in. Deadlines, budget cuts, changing customer demands, shifting competitive landscapes, and the overall need to do more with less are forcing many professionals and organizations to be reactive. A reactive culture, however, very often derails even the best strategic plans. What if we could change the way we approach our work so that were not constantly being acted upon, but driving action instead? Im not suggesting that we stop listening and reacting altogether; our jobs will always require thissome more than others. There are, however, instances in which we can take the initiative to
BEING MORE PROACTIVE IS NOT MERELY A NICE THOUGHT; ITS ESSENTIAL.

save money, time, and resources; lower risk; and improve our bottom line. Why not do it? Im sure many who read this are thinking, Who has time for this? Im still too busy putting out fires! Thats just another example of reactive reasoning. To think that youor the people in your organization are too busy to see the bigger picture is a mistake, one that will secure your organizations fate to be influenced by (and also unable to influence) others. A more constructive analogy: Think of the people in your organization working together to blaze a trail through a forest. As your colleagues do so, though, someone must rise above the trees to see if the developing path is taking the right direction. There will be both dangers and opportunities further along, but if no ones looking your organization will consistently struggle with the former and miss the latter. In the best-selling book The 7 Habits of Highly Effective People, Stephen Covey encourages people to become more proactive and less reactive. Reactive
4
people, he writes, are driven by feelings, by circumstances, by conditions, by their environment. Proactive people are driven by valuescarefully thought about, selected, and internalized values. Proactive people are still influenced by external stimuli, whether physical, social, or psychological. But their response to the stimuli, conscious or unconscious, is a value-based choice or response. Being proactive enables organizations to not simply pick the best path, but to also be prepared for opportunities and obstacles along the way. In this months cover story, Take the Initiative (page 20), Associate Editor Lauren McKay provides examples of how organizations can benefit from being more proactive. Southwest Airlines, for example, created a Proactive Customer Service Communications group to follow up with passengers who reported a poor customer experience, apologize for any inconveniences, and offer a voucher if appropriate. This process embodies a simple act of kindnessand has produced significant results. According to the article, 70 percent of Southwest customers who receive proactive communications return to the airlineand bring others with them. The feature How Can I Help U? (page 26), by Editorial Assistant Juan Martinez, provides additional examples of how proactive CRM can empower your organization to support and influence customers, and how proactive chat in particular can help you attract and retain customers on the Web. The reality is this: Being more proactive is not merely a nice thought; its essential. If you dont act to support your existing and potential customers, you will be acted uponor worse, ignored.
DAVID MYRON Editorial Director dmyron@infotoday.com @dmyron on Twitter

VIEWPOINTS
EDITORIAL DIRECTOR David Myron dmyron@destinationCRM.com
Joshua Weinberger jweinberger@destinationCRM.com SENIOR DESIGNER Laura Hegyi lhegyi@infotoday.com ASSOCIATE EDITOR Lauren McKay lmckay@destinationCRM.com EDITORIAL ASSISTANT Juan Martinez jmartinez@destinationCRM.com EDITORIAL ASSISTANT Koa Beck kbeck@destinationCRM.com CONTRIBUTING WRITERS Lior Arussy, Carolyn Heller Baird, Barton Goldenberg, Marshall Lager
MANAGING EDITOR
Read the following exclusive essays during the month of October at www.destinationCRM.com
5 Steps to Personalized Customer Contact
How to tailor online customer experience to boost loyalty and drive revenue.
BY CARSTEN THOMA, PRESIDENT, HYBRIS U.S.
EDITORIAL ADVISORY BOARD
Lior Arussy, PRESIDENT, STRATIVITY GROUP; Ginger Cooper, FOUNDER, CRM ASSOCIATION; Barton Goldenberg, PRESIDENT, ISM, INC.; Paul Greenberg, PRESIDENT, THE 56 GROUP; Sheryl Kingstone, CRM PROGRAM MANAGER, YANKEE GROUP; Maggie Klenke, PARTNER, THE CALL CENTER SCHOOL; Denis Pombriant, FOUNDER AND MANAGING PRINCIPAL, BEAGLE RESEARCH GROUP
ADVERTISING SALES/PRINT & ONLINE
Talking the TalkBefore the Sale

The execution of live chat can make or break the conversion.
BY ROSS HASKELL, DIRECTOR OF MARKETING, BOLD SOFTWARE
Bob Fernekees 1-212-251-0608 x106 bfernekees@destinationCRM.com Dennis Sullivan 1-800-248-8466 x538 dennis@destinationCRM.com EAST/MIDWEST AD DIRECTOR Adrienne Snyder 1-201-327-2773 adrienne@destinationCRM.com
VICE PRESIDENT AND GROUP PUBLISHER WEST COAST AD DIRECTOR
MARKETING
Tom Hogan, Jr. thoganjr@infotoday.com DIRECTOR OF WEB EVENTS DawnEl Harris dawnel@destinationCRM.com
DIRECTOR OF MARKETING
Community as a Strategy
Social CRM and next-generation customer service.
BY MICHAEL WOODEN, SVP, MARKET DEVELOPMENT, ACS, A XEROX CO.
EXECUTIVE MANAGEMENT
Thomas H. Hogan thogan@infotoday.com CHAIRMAN Roger R. Bilboul; VICE PRESIDENT, ADMINISTRATION John Yersak johny@infotoday.com VICE PRESIDENT, CONTENT Dick Kaser kaser@infotoday.com
PRESIDENT AND CEO
INFORMATION TECHNOLOGY
VICE PRESIDENT, INFORMATION TECHNOLOGY
Bill Spence spence@infotoday.com
Digital Marketing Means Multiple Channels

Universal profile management directs all relevant communications through the channels that customers prefer.
BY BRIAN DEAGAN, COFOUNDER AND CEO, KNOTICE
PRODUCTION
VICE PRESIDENT, GRAPHICS AND PRODUCTION AD TRAFFICKING COORDINATOR
M. Heide Dengler hdengler@infotoday.com Michael Hardwick mhardwick@infotoday.com

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CRM (ISSN: 1529-8728) is published monthly by CRM Media, a division of Information Today, Inc., 143 Old Marlton Pike, Medford, NJ 08055 USA; Phone: (609) 654-6266; Fax: (609) 654-6266; Internet: www.infotoday.com. Registered in U.S. Patent & Trademark Office. Periodicals postage paid at Medford, N.J., and other mailing offices. Copyright 2010, CRM Media, a division of Information Today, Inc. All rights reserved. No part of this publication may be reproduced in whole or in part in any medium without the express permission of the publisher. PRINTED IN USA POSTMASTER: Send address changes to CRM magazine, P.O. Box 3510, Northbrook, IL 60065 Rights and Permissions Permission to photocopy items is granted by Information Today, Inc. provided that a base fee of $3.50 plus $0.50 per page is paid directly to Copyright Clearance Center (CCC), or provided that your organization maintains an appropriate license with CCC. Visit copyright.com to obtain permission to use these materials in academic coursepacks or for library reserves, interlibrary loans, document delivery services, or as classroom handouts; for permission to send copies via email or post copies on a corporate intranet or extranet; or for permission to republish materials in books, textbooks, and newsletters. Contact CCC at 222 Rosewood Drive, Danvers, MA 01923; (978) 7508400; Fax: (978) 646-8600; www.copyright.com. If you live outside the USA, request permission from your local Reproduction Rights Organization. (For a list of international agencies, consult www.ifrro.org.) For all other requests, including making copies for use as commercial reprints or for other sales, marketing, promotional, and publicity uses, contact the publisher in advance of using the material. For a copy of our Rights and Permissions Request form, contact Lauree Padgett, lpadgett@infotoday.com. Online Access Visit our Web site at www.destinationCRM.com Searchable archive of all articles with digital document delivery: www. iti-infocentral.com Contents also available online under direct licensing arrangements with EBSCO, NewsBank, ProQuest, Gale, and H.W. Wilson and through redistribution arrangements with information service providers including Dow Jones Factiva, LexisNexis, OCLC, STN International, and Westlaw.
The Engagement of Unified Communications

Definitely not all for one and one for all.
BY SCOTT ZIMMERMAN, PRESIDENT, TELEVOX
Ever Talk to a Robot?

Virtual agents are the newest channel for customer service.
BY MARK GAYDOS, VP, WORLDWIDE MARKETING, VIRTUOZ
CRM: More Relevant Than Ever

Measuring the impact of change is what CRM does best.
BY ALAN ADLER, MARKETING CONSULTANT, ALAN ADLER ASSOCIATES
Its About Answers

Knowledge-based technologies are now essential to the customer experience.
BY BRENT HAYWARD, VP, WORLDWIDE PARTNER DEVELOPMENT, INQUIRA
The Quick and the Dead

The competitive advantage of getting to a lead first.
BY GLENN HOUCK, COFOUNDER, LEADQUAL
The Decline of IVR

The always-connected customer prefers self-service smartphone applications.
BY ZOR GORELOV, CEO, SPEECHCYCLE
REALITY CHECK
BY
BARTON GOLDENBERG
A Quarter-Century in CRM
An industry veteran looks back at the lessons learned over the course of 25 years
R E M E M B E R W E L L my first encounter with the CRM industry, at a sales and marketing conference in New York in 1985. Clients had been asking me which sales force automation (SFA) software was bestand what preparations effective SFA required. At that 1985 event, three vendors each worked hard to convince me that its respective offering was the best. Yet when I asked that second question to each of them What preparations are required?I was met with silence. To counter what seemed to be a simplistic, vendor-focused approach to the technology, we developed an 18-step CRM methodology that focused on getting the people/process/technology mix right. My feeling thenand nowwas that a technology-driven CRM industry would never take off. The people and process sides of CRM required greater attention. The message took holdslowly. After testing an early CRM offering, for example, we scored the application very low in the area of user-friendliness. When the vendor complained, we reviewed each of the categories with the vendor and held our groundand the vendor eventually made most of the proposed changes.
IVE JUST BEEN PUT IN CHARGE OF OUR CRM INITIATIVEAND IM CONCERNED THAT IVE JUST TAKEN ON A CAREER-TERMINATING EVENT.
In the mid-1990s, the founder and chief executive officer of a top CRM vendor asked us to review a new offering. The technology included some advancements, but failed to allow users to easily embed customer-facing processesa flaw that would depress user-adoption rates. At the time, the CEO was irate, yet the vendor has since addressed its process deficiencies. The struggle continues, as evidenced by a call I got from a client just a few years ago. Ive just been put in charge of our CRM initiative, he told me. Im being bombarded by CRM vendor pitches about why their software is the best, and Im concerned that Ive just taken on a career-terminating event. The CRM methodology weve developed over the past 25 years responds to that concern. A top-down
6
component tightly aligns the CRM initiative with the direction of the business and secures executive support. The objective is to determine how CRM tools and techniques can help address the companys burning business issues. The stronger the linkage, the more likely the emergence of executive-level support. The outcome is a CRM vision statement that gets communicated to all potential users along with a high-level business case that helps to set financial expectations. A bottom-up aspect combines three factors: business requirements, software/ partner selection, and implementation. Business requirements prioritize functional requirements within the people/ process/technology mix that ultimately determines the success or failure of your initiative. It requires active participation and representation from all levels of customer-facing functions including sales, marketing, and customer service. Software selection is often a daunting task given the large number of existing and emerging vendors in the marketplace. Many sources offer advice (including ISMs published findings, at http://sn.im/ismguide2010), but the key is to prepare your requirements well so that you, not the vendor, drive this selection process. Implementation is where the rubber meets the road. Strong project management is mandatory, as are data standards and integrity, executive leadership, meaningful change management, effective communications, continuous training, a champion program, and robust incentives. Want to see this approach in action? CRM magazines July 2010 cover story (15 Years of CRM) recounts the experiences of five companies that implemented this methodology over the years, and have been able to sustain their CRM advantage despite numerous obstacles. The effort to get the right mix has its costsincluding the loss of much of my hair! But this was the right decision 25 years ago, andthanks to the clients, vendors, and analysts that have assisted usit remains the right decision to this day.
Barton Goldenberg (bgoldenberg@ismguide.com) is president and founder of ISM, Inc., a consulting firm that since 1985 has applied CRM, social CRM, and social media to successful customer-centric business strategies. He is the publisher of The Guide to CRM Automation (17th edition) and author of CRM in Real Time: Empowering Customer Relationships (Information Today, Inc.).
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CUSTOMER CENTRICITY
BY
LIOR ARUSSY
Buzz, Buzz, Buzz

Enough with the buzzwords and hype. Lets start doing
E C E N T LY I came across a conversation in
one of the customer portals. The article discussed the need to link customer satisfaction metrics to compensation in order to obtain real commitment. One of the so-called gurus took the time to post a comment that basically boiled down to, This is old newswere in co-creation world now. I was pissed and I gave him a piece of my mind. In June 2000, I launched the first customer experience management (CEM) solutionit was a visible launch and a Datamonitor report the following month credited me with coining the CEM phrase. Ive been evangelizing customer experience ever since. There were many other evangelists who supported the CEM concept, of course, and weve all, in our own ways, worked diligently from one seminar to another, from one
OUR RESPONSIBILITY IS TO ASSIST OUR ORGANIZATIONS IN BUILDING THE CAPACITY TO MAKE THINGS HAPPEN.
conference to another, to get the message out. Its now 10 years later, and were only just starting to see some form of commitment or critical mass around the CEM concept. My point is that these revolutions take time to take root. Yes, co-creation might be the next big thing. But how many companies are actually implementing co-creation in a meaningful and widespread way? No more than a handful. So why knock an organization thats willing to link customer judgment (or feedback) to compensation and increase employees commitment? Why sacrifice progress today in favor of the mere promise of possible progress tomorrow?
8
Change takes time and different organizations go through change at their own pace, based on their own DNA. As evangelists of customer centricity (whether as external consultants or internal practitioners), we ought to be responsible and lead people to execution. While new concepts and ideas evolve, our responsibility is to assist our organizations in building the capacity to make things happen and create real improvement for customers as well as companies. So the next time you feel the urge to create another buzzword or twitter about the latest concept youve lifted from another ivory-tower academicdont! Enough with the buzzwords. We have more than enough of them on hand already. We have a powerful agenda for the next several years: innovation that benefits customers and inspiration that drives employees to excel. That agenda demands that we focus not on another fancy diagram but on creating measurable results. Now. Unfortunately, this is exactly where great ideas often fail. Just take a look at discussion forums on LinkedIn or similar sites, where the dominant issue of the day is, How do I demonstrate value and deliver financial impact? CEOs and corporations arent looking for another buzzword. Theyre looking for the capacity to execute on the ideas that are already there. Theyre saying show me the money. Lets not litter our world with more buzzwords. Its execution time. Let the best execution organization win.
Lior Arussy (lior@strativity.com) is the founder and president of Strativity Group, a global customer experience research and consulting firm. He is the author of several books, including Excellence Every Day (Information Today, Inc., 2008) and Customer Experience Strategy (2010), an excerpt of which appeared in the May 2010 issue of CRM. To learn more about customer strategies, sign up for his newsletter at www.strativity.com.
THE TIPPING POINT

BY
CAROLYN HELLER BAIRD
Intimacy Issues
You can enhance customer intimacy in ways that didnt exist until very recently
R E D I C T I N G future trends amid unprecedented change is like riding a high-speed express train and trying to read the station names as you whiz by. You know youre headed somewhere, but the signposts along the way are a blur. Thats how many business leaders are feeling these days. A May 2010 survey by the IBM Institute for Business Value (IBV) of more than 1,500 chief executive officers from 60 countries and 33 industries revealed a business environment thats volatile, uncertain, and increasingly complex. Eight out of 10 CEOs expect their environments to grow significantly more complex but only 49 percent believe their organizations are equipped to deal with it successfullythe largest leadership challenge identified in eight years of research. Revenue from new sources is expected to double over the next five years and 76 percent of CEOs foresee the shift of economic power to rapidly developing markets. But how to respond? The study revealed three key strategies for this competitive economic environment: embody creative leadership, build operating dexterity, and reinvent customer relationships.
DESIGNING STRATEGIES THROUGH THE LENS OF THE CUSTOMER IS ONE WAY TO STAY LASER-FOCUSED ON WHAT MATTERS MOST.
The desire to connect is understandable. As new products and services enter the market with lightning speed, and social networks and applications vie for customers attention, the customer seems more elusive than ever. The good news? Businesses can enhance customer intimacy in ways that simply didnt exist until recently, capitalizing on the very factors contributing to the complexity. This is a perfect storm: Customers desire to engage is fulfilled by new communication channels and tools, and companies now have the technologies to make sense of it all in a continuous listen-learn-innovate-improve loop. This alignment finally makes it possible to reap the benefits of becoming a truly customer-centric company. Getting closer to the customer, though, requires more than new CRM software or a Twitter account. The project cant exist solely within a single domain or department. Customer centricity is an enterprise strategy addressing a
10
companys core values, so sponsorship atop and across the organization is essential. There are many approaches to defining and executing a customer strategy, but analytics now plays a differentiating role. Most companies have tons of customer data; what they lack is insight. The problem, as one respondent lamented,is a misinformation explosion. Enter social networking and social media. Never before has a channel so rich with customer datastructured and unstructuredbeen available to mine, examine, and interpret with analytics. Maximizing these capabilities with a fresh approach to leadershipbold thinking and ongoing experimentationcompanies can cultivate an environment where exciting insights can reshape customer experiences and improve products and services. Consider customer co-creation. In a January 2010 IBM IBV study, 78 percent of consumers surveyed said they would collaborate with retailers to develop products and services. In the past, this co-creation effort was timeconsuming and costly, and findings were rarely shared beyond the circle of project stakeholders. Today, via social networking and apps, companies can rapidly and inexpensively tap both the collective and individual wisdom of people who want to engage, be heard, and share their opinions. Thats not just customer advocacythats customer evangelism, and its priceless, especially in todays digital ecosystem where an influencer can virally reach a network of thousands in mere minutes. Whats more, with new social CRM technologies, customer insights can be shared easily throughout the enterprise, enabling organizations to see how customer desires and behaviors influence the entire operational value chain. Imagine the possibilities: Every organization, encouraged to explore new ways of collaborating and executing, could reframe its mission to build the best customer experience possible. In the face of such complexity, designing strategies through the lens of the customer is one way to stay laserfocused on what matters most.Youll know where youre going and how to get thereno matter how fast the train.
Carolyn Heller Baird (cbaird@us.ibm.com) is the CRM global research leader for IBMs Institute for Business Value (IBV), and a senior managing consultant with IBM Global Business Services, where she specializes in customer experience strategy and digital communications consulting. The IBM IBV 2010 CEO Study is available at http://sn.im/ibmibvceo10 and additional thought leadership from the IBV can be found at http://sn.im/ibmibv10.
CRM TRENDS AND NEWS ANALYSIS
IMPLEMENTATION SUCCESS METER
FAILURE
SUCCESS
A Succession of Failures
Industry analysts explain how vendors and customers can avoid the communication errors that occur during CRM implementations
he CRM industry has two general interests: happier customers and higher revenues. But what happens when the industry leaves usersits own customersdisgruntled? Not long ago, that was an all-toocommon outcome, with lawsuits peppering the landscape. In the last few years, the frequency of failure seemed to have tapered offsee 15 Years of CRM (July 2010) for more on the industrys progressbut a recent spate of high-profile bonfires has reignited some of the old controversies. Take, for example, the recent debacle between systems integrator Electronic Data Systems (EDS) and United Kingdom based broadcaster British Sky Broadcasting (BSkyB). EDS (now owned by Hewlett-Packard and called HP Enterprise Services) agreed to pay BSkyB a whopping $460 million to settle a lawsuit claiming EDS misrepresented its capabilities in the bidding process back in 2000. For an industry still sometimes struggling to make clear that CRM requires more than a reliance on Microsoft Outlooks contact tab, any such lawsuit can become a significant impediment. CRM may be mission-critical to the business processes of most organizations, but why invest in a CRM system that cant live up to its advance billing? To be clear: Every analyst reached by CRM agrees that the EDS/BSkyB failure was a one-off. Rarely, if ever, are there com-
munication failures of this magnitude or major CRM technical breakdowns. The analysts also agree that errors in communicationwhether by misrepresentation or notcan and should be avoided at all costs. A handful of problems may be unavoidable, but both users and vendors should be eager to avoid becoming the subject of the next blogpost by Michael Krigsman, chief executive officer of Asuret, a consulting company dedicated to reducing the number of technology-implementation failures. Its very rare that theres a CRM failure thats an absolute failure, Krigsman says, meaning that the implementer spent $100 million and at the end of the day had to throw it all away. The vast majority of CRM failures, he adds, are exclusively a function of the buyers perception. Most disputes, he explains, can be traced to a system that is late, only sort of works, is overbudget, or doesnt deliver the value promised. Krigsman compares the installment of a CRM solution to the renovation of a house: A homeowner and a contractor might establish a budget and a timeline, but what happens when the contractor opens the walls and discovers rusted-out plumbing? The homeowner doesnt have to change the pipes, but that will only lead to a bigger problem in a yearso he decides to redo the plumbing along with the other renovations. In other words, the project now has an entirely different scope.
2) The systems integrator doesnt deliver on its promises. 3) The customer doesnt do a good job preparing its internal teams and planning.
The 3 Faultlines of Failure

According to Ray Wang, a partner at Altimeter Group, every CRM failure occurs on one of three axes:
1) The software may not necessarily be the right solution for that market.
12
Insight
The economic downturn, Krigsman suggests, has caused material you showed me as part of the contract is what youre businesses to be increasingly sensitive about financial waste, going to deliver, he explains. When the vendor comes in to thus causing a greater degree of wariness regarding potential do demos, we film them. Were going to assume that the stuff problems in the CRM market. The way to assure yourself that in the demos is in the software. Is the stuff out-of-the-box? Is your CRM project doesnt end up as the fuzzy end of a lollipop this something you modified and is custom? Or is this someis to set concrete reference points in the projects original con- thing you made up? Ask them that question on every screen. tract. Sounds simple, right? So why doesnt it always happen? When it comes time for the contract, you say, Look, these are Companies think theyre buying [Microsoft] Excel when they our assumptions. This is what youre delivering to us. If they back off, dont buy the software. Its actubuy a CRM tool, Krigsman argues. Theres ally pretty simple. a very strong temptation to try to think of it Its very rare that theres a CRM Aside from the obvious repercussions for as a simple tool, but its notit operates withfailure thats an absolute failure. CRM users, whats the effect on customers in the context of a business process. Compawhen these initiatives fail? These systems nies need to know [by whom], how, and why the platform is being used. If they really understand that, theyll are important, Krigsman says,which is why organizations invest so much to select, deploy, and use them. Therefore, any have a better reference point to evaluate the vendors. The results of a 2010 Forrester Research survey reveal a huge glitch or problem that interferes with these systems has the pogap still exists between CRM vendors and buyers. According tential to create a chain reaction that negatively impacts custo the survey, only 46 percent of businesses using CRM agree tomers and their relationship to the organization. In short, Wang says, failures in CRM produce frustrated custhat the products functionality matched what was promised in the sales cycle. (Another 45 percent say they somewhat tomers, and it hurts the bottom line. And if businesses lose agree.) Isnt there something wrong with an industry that moneywell, then the entire CRM industry suffers. We cant afford any more of these disasters, he warns. completely satisfies less than half of its consumers? Executives at EDS would likely agree. Juan Martinez Sure, says Forrester Vice President and Analyst William Band, but theres plenty of blame to go around. Customers are justified in terms of their experience, Band says. [But] weve done other surveys where we took the same group and asked them to tell us what their problems were and they identified 200 different problems. Thirty percent to 40 percent of the problems were related to the vendor and its technology. But the other two-thirds were people, process, and strategy. We found a lot of people acknowledging that they didnt have the skills that they needed to implement the solution, they didnt have their business processes defined, and they didnt manage their data properly. Flexibility and communication are vital, says Paul Greenberg, president and founder of consultancy The 56 Group. When putting together a statement of work, CRM vendors should establish flexibility from the get-go, ensuring that the parameters are clear from the start. That way, if the project somehow goes beyond its original scope, the following will be predetermined: the new price, the level of the scopes expansion, the steps that will be taken to meet the additional need, and the time frame required to complete the newly defined job. The terms and conditions should be crystal clear to all parties, Greenberg says. In the early days, you didnt have a protocol for dealing with issues, he recalls. Now, absolutely everything should be spelled out in contractual terms. According to Ray Wang, a partner at Altimeter Group, every CRM failure occurs on one of three axes. (See The 3 Faultlines of Failure, page 12.) The contract, he insists, has to span the entire implementation process, from the product demonstration to what would happen if either business were to be acquired. You can put a clause in the contract that says every
ON THE SCENE: CRM EVOLUTION 10
A CRM Showdown in Times Square

Executives from four of the industrys top vendors share the same stagebut not the same views
ell, no one can say CRMs annual CRM Evolution conference was boring. Held the first week of August at the New York Marriott Marquis, the events most-anticipated panel lived up to its hype: For the first time ever, executives from four of the industrys top firmsrepresenting Microsoft, Oracle, RightNow Technologies, and SAPgathered on one stage to field questions, duke out competencies, and tussle over CRMs biggest trends. Moderated by Paul Greenberg, founder and president of consultancy The 56 Groupand, incidentally, the chairman of the event and CRMs most recent inductee into the CRM Hall of Famethe panel comprised Greg Gianforte, RightNows founder and chief executive officer; Anthony Lye, the senior vice president of Oracle CRM; Jujar Singh, the senior vice president of CRM
at SAP; and Brad Wilson, the general manager of CRM at Microsoft. Given the vendors long-standing competitive friction, attendees understandably expected a little heat in the well-airconditioned space, but what they got more closely matched the weather outside, where it was particularly steamy, even by New Yorkin-August standards. While the panelists generally maintained their composureand their objectivitya handful of tense moments raised a few eyebrows in the room full of CRM pundits. Marshall Lager, a principal at Third Idea Consulting and a CRM columnist, acknowledges the heated comments, but says that the panelists actually had little to fight about. Each ones making smart moves and has a good CRM product, he says. But vendors will be vendors. Everyone had an agendaand it was laid out, Greenberg says. No one asked them to
hide that. The most pointed comments dealt with integration, and how to fit a CRM solution within a given software ecosystem. Each panelists view, however, seemed largely determined by his respective employers software strategies.They didnt say,This is why you should buy our software, Greenberg recalls, but they still were reflecting what the companies did and what the companies strategies and approach to sales were. Thats why you heard hybrid from SAP,single-suite from Oracle, cloud from RightNow, and a mixed thing from [Microsoft]. The panelists themselves insist their answers were more than mere marketing. We did not see this panel primarily as a forum to promote our product, Singh says, but to share SAPs perspective on some of the key CRM trends and to provide answers to specific questions from the audience about SAPs CRM product vision and roadmap.
CRM on
@kitson: And the celebratory postmortems begin! CRM Evolution 2010: A Retrospective, 28Hrs Old, by @pgreenbe http://sn.im/pg080510 @kitson: The Evolution of CRM on Display in NYC, by @ekolsky http://sn.im/ek0804 @kitson: CRM Evolution 2010 Quick Thoughts and Takeaways by andrew_boyd http://sn.im/ab0804 @kitson: CRM Evolution wrap up, by @denispombriant http://sn.im/dp0804 @kitson: My Personal Notes from CRM Evolution 2010, by @Marcio_Saito http://sn.im/ms0805
This years CRM Evolution conference (http://sn.im/crmevolution) drew some of the industrys biggest names. (See A CRM Showdown in Times Square, above, for a look at just one highlight.) Needless to say, the event also generated a lot of chatter in the twittersphereand weve gathered a few of the postmortems here. Our Twitter channel for the show was @CRMe10, and the hashtag for tweets was #CRMe10; visit http://sn.im/crme10-twkeeper for a Twapper Keeper archive. You can find us year-round at www.twitter.com/CRM; blogposts and live-twittering appear at www.twitter.com/destinationCRM. Reach us directly by starting your tweet with @CRM.
@burtonjohn: CRM Evolution 2010 conference was amazing, but now its over and Im already going through withdrawals. #scrm #CRMe10 @themaria: And so #crme10 completes :( SO great to reconnect with old friends, meet new friends and meet my virtual friends in person finally! ROCK ON!
@MarcLGod: #CRMe10 was in one word GREAT! Learned a lot abt sCRM. Met the greatest people.[]
@prem_k: A day after #CRMe10s great presentations, wishing I could have presented too. @mjayliebs idea for an unconference is a great one IMHO. :)
@conniechan8: It was great to meet so many of the ppl I respect and admire! Bye for now...#crme10
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Insight
While Singh stressed the importance of integrating CRM and other software systems, Gianforte spoke of the benefits of seeing customer experience through the customers eyes and making software-asa-service solutions as easy to maintain as they are to deploy. Lye outlined Oracles software stack but also explained how to mimic successful consumer Web interactions and support cross-channel strategies. Wilson spoke with gusto about analytics and re-evaluating best practices to incorporate social media. Greenberg admits he found the topics of conversation a bit surprising, and that he was shocked when, after the discussion opened to audience questions, most were related to hard-core traditional CRMintegration, analytics, and e-commerce, to name a few. The audience questions did reflect real issues, though there were still a lot of foundational questions, Gianforte says. I was expecting more discussion around social. Nevertheless, Gianforte says that, for the most part, he found the discussion quite even-keeled, though it did get a bit livelier around the integration question. (When Lye suggested that buying a single suite from one vendor had its advantages, Gianforte was the one to remark sarcastically, We should just buy everything from Oracle, then.) Wilson says that he made an effort to approach the event from an industry or customer point of view rather than through the lens of a vendor. Were all tackling these issues together as a community, he says. Lager echoes Wilsons point, noting that he sensed a were in this together attitude during the panelalongside a sliver of one-upsmanship, that is. Combativeness, Lager notes, was to be expected, given these executives roles and responsibilities. There was a lot of brain power up on that stage, he says. Still, though the panel included some of CRMs biggest movers and shakers, Lager was among several analysts and bloggers to observe that one CRM player was notably missing. Salesforce.com was very conspicuous by their absence, he says. (The company declined an invitation to participate in the event.) Greenberg takes an even firmer stance. Salesforce[.com] needs to rethink some of their marketing strategy at this point, he says, and make sure they start showing up to things like this, which are important. These are companies they compete against. Salesforce[.com] didnt look good by comparison. One things for certain: As the CRM industry continues to evolve, so will the CRM Evolution conference. Next years event (http://sn.im/crmevolution) will bring new ideas, new conflicts, and since Greenberg and the Enterprise CRM panelists all say they would return if askedanother chance to hear from the industrys top dogs. Lauren McKay
The Crash of Google Wave
a document, [and] use numerous different logins as each project is owned by different vendors or partners. Even worse, these tools are slow, arduous, and have user interfaces that look completely primitive. Yared counters the claim made by Sheryl Sandberg, chief operating officer The search-engine giant beaches its innovative collaboration engine at Facebook, that email is becoming obpositive way because I know there are solete. Social networking sites may be hen Google announced the shutdown of its a lot of small companies that are work- the preferred mode of communication Google Wave product in ing on a cloud-based collaborative among the younger generation, but August, no one saw it platform, Rama says. If a big company Yared says he expects that to change. I have a teenager, Yared says. If I coming. A highly innovative online- like Google succeeds, it could [have exsend him an email, I dont get a response collaboration application, Wave allowed panded] the opportunity out there. Rama says shes a strong believer in for two days. The young generation does users to share richly formatted text, images, videos, mapsall in real time. the cloud, but that the model needs to not use emailand also doesnt work. Participants could be added and conver- accommodate a wide range of applica- The minute they enter the workforce, tions. Customers need theyll get on email. sations replayed to keep Yared notes that, at present, many greater choices, she notes. everyone in the loop not Google has been a very collaborative applications are being just on projects and plans, strong proponent of this quickly outpaced by email when it but on updates, changes, model. [There had comes to real-time participation, as and edits as well. been] so much hype, email always seems to be used regardless. Subah Rama, senior anhopeand a very broad These project management services get alyst of enterprise commuaudiencethat [Wave] get- out-of-date very quickly, he says, benications at ABI Research, ting pulledkind of raises cause people inevitably start emailing says she was disapsome questions on the each other rather than updating the pointed by the news. cloud-development model. project online, especially when execuRama had predicted Wave Peter Yared, founder and tives with BlackBerrys are in the project might have the same impact on collaboration that the free Gmail chief executive officer of Transpond, a loop and near the end of a project when offering had on the email market after company that provides infrastructure there is typically a frenzy of activity. Yared says he found Google Wave to Google launched that service in 2004 and for social and mobile applications, has a different view of what Waves crash be a step in the right direction, but that made it generally available in 2007. When I saw [Wave] launch last year, might signify: the end of collaborative ultimately email itself will become more Rama says, I thought it would defi- software itself. The collaboration solu- collaborative, eliminating the need for a nitely redefine the way people collabo- tion is becoming very out of date, Yared separate applicationor industry. The proper approach rate. Google, she adds, gave no advance says. [Collaboration softis if you take Gmail and indication that Wave was about to be ware] never gets used the [Google Wave] getting add more collaborative pulled. In Googles official blogpost an- way its intended to be used pulledkind of raises [elements, which] Im nouncing the move, the only explana- because every project is besome questions on the sure [Google is] going tion given was that Wave has not seen ing managed by email. Yared first aired his the- cloud-development model. to, Yared muses. Email the user adoption we would have liked. is going to grow up to be Still, the product managed to inspire ory in a personal blogpost some pie-in-the-sky possibilitiesand titled Its Collaboration Software collaboration software. Its going to those may outlive Wave itself. Rama and thats Dead, not Email. There is no replace a lot of project software. Rama proposes a future for collaboraother analysts spoke of the influence quicker way to make a group of people Google Wave would have had on collab- in a conference room grimace than to tive software thats slightly more hopeorative software. Many had hoped that announce you are going to use Base- ful, noting that many companies are still Google would eventually develop a prod- camp, Central Desktop, or their kin to trying to figure out how to use the techuctized Wave for enterprise integration. manage a project, he wrote. These nology effectively. Its still a very emergThe effects of Google Wave would services constantly spam your inbox ing market, she concludes.Theres a lot have impacted the industry in a very every time someone adds a comma to of homework to be done. Koa Beck
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MARKET FOCUS: HEALTHCARE
A Prescription for Social Media

One provider shows how to join consumers in social networks without compromising a secure relationship
ccording to an April 2010 study conducted by the marketing firm Epsilon, 40 percent of online consumers turn to social media for health information. Separate research by digital marketing company iCrossing shows that, within a 12-month span, 59 percent of adults searched online for health-andwellness advice, and 55 percent of adults sought answers from doctors. The rise of social media has the healthcare industry stuck between a rock and a hard place. Consumers actively researchand converse abouthealthcare topics on the social Web. Dangerously absent from most of those conversations, however, has been the healthcare provider, the traditional source of those answers and still the source of most medical treatment. Online portals such as WebMD and Yahoo! Health have earned praise for advancing Health 2.0 and providing consumers with interactive (and reliable) health-oriented content. Traditional healthcare providers have largely failed to compete due to privacy restrictions, a lack of resources, and uncertainty over where to begin. One company, however, is carving out a social presencewithout
compromising its privacy standards or its reputation as a trusted healthcare advisor. Cleveland Clinic, one of the largest hospitals in the country, not only actively maintains profiles on Facebook, Twitter, and LinkedIn but also runs the Cleveland Clinic Online Health Chats, two online channels dedicated to providing consumers with professional-grade healthcare information. One chat is devoted to connecting consumers with live nurses. The other is a resource for people whether or not theyre Cleveland Clinic patientsto connect with a physician regarding a given healthcare topic. The chats allow consumers to ask questions anonymously, gain information from a trusted source, and access archived conversations. Betsy Stovsky, who manages online communications for Cleveland Clinics Heart and Vascular Institute, says the Web chats were a success as soon as they began in 2007. Its been a great venue for people to ask questions and get to know the clinic a bit, she says. But mostly to give people an opportunity to be educated semi-anonymously and to chat with a physician. Cleveland Clinic conducts six to eight live chat events per month, on topics
DOES IT HURT WHEN I TEXT YOU HERE? At Cleveland Clinic, a series of Webbased chats conducted each month is blending the online and offline worlds of medicinewithout sacrificing either privacy or quality of care. 18
ranging from pediatrics to cancer to womens health. The chatsmarketed through email newsletters, the clinics Web site, various healthcare boards, and occasionally through paid online ads are open to the public, and the clinic asks that participants refrain from revealing personal information. The goal, after all, is to share reputable information, not individual diagnoses. As a healthcare organization, Stovsky notes, Cleveland Clinic is legally bound to maintain patient privacy. Stovsky admits that, to a certain degree, the clinic is still trying to get a handle on Health 2.0 and the rise of the community in healthcare. Some risks are mitigated by keeping the chats structured and having participants submit questions for a quick review before theyre posted. With a lot of community sites, there are patients giving each other advice, she says. Sometimes that can be helpful, but sometimes it can be harmful. In [Web chat], people are asking questions and the answers are from a healthcare professionalnot from other patients with the condition. At Cleveland Clinic, social media means delivering more information into the hands of more peopleregardless of those peoples status as paying customers. Registration numbers for the scheduled chats vary from 10 to 100 per session, but Stovsky reports that some transcripts, posted online, eventually accumulate thousands of hits. Everything is so complicated with healthcareits hard to get in to see doctors, and often medical terms are difficult to understand, Stovsky admits. This is a great way to gain more understanding of treatment options. Steve Case, the former chief executive officer of online-community pioneer AOL, insisted at a 2008 healthcare event: Community is the killer app in healthcare. The sector may have been relatively slow to adopt, say, social networking avatars, but institutions such as Cleveland Clinic seem to be closely checking the pulse of the social Web, and making advances as they see fitoften the best prescription for success. Lauren McKay
Insight
REQUIRED READING
Slowing Down Your Social CRM

Relationship-building takes more than a tweet
he first question executives ask prior to implementing social media marketing strategies is: How can I measure the return on investment? Joan C. Curtis, chief executive officer of consultancy Total Communications Coaching, offers the simplest possible answer: You dont have to. In The New Handshake: Sales Meets Social Media, Curtis (with coauthor Barbara Giamanco) discusses intelligentand not-so-intelligentuses of social media. She sat down with Editorial Assistant Juan Martinez to discuss the topic. CRM magazine: You write that the lines of sales and marketing are becoming blurry. Can you explain how and why? Joan C. Curtis: One of the people we interviewed for the book termed this phenomenon smarketing. It used to be that marketing teams created brand identity and then salespeople went out, touched leads, and made sales. Now sales teams are part of building brand identity and relationships. Part of the books premise is that salespeople are highly skilled in understanding the know, like, and trust factors which create relationships, yet theyre left out of that relationship-building process. CRM: Lets talk about relationship selling. Curtis: Its first about the relationship and then about the product. Companies need to step back and listen before they even enter the conversation. If they do that, they find out what customers are talking aboutwhat their needs are, what their pains are. Businesses can learn all that stuff and then slowly enter the conversation and enter with good content and information. People will then start to respect their knowledge. Then who do you think theyll buy from? Marketers are
starting to call it a pull process instead of a push process. Imagine it like threading a needle: Put the thread in and carefully pull it through. CRM: You praise Barack Obama for his use of social media in the last election. What can salespeople and marketers learn from him? Curtis: One thing that Obama did that was so powerful, using Facebook and email marketing, is that he connected with a whole bunch of people online and created relationships and got a buzz going. He also went out shaking hands and all the old stuff you do as a politician. The message is: You have to combine the old with the new. If you just toss out all the old stuff, and only take on the new, you wont succeed. Youve got to have that blend of both that works best for your products and services. Some will find a smaller use of social media than others. But you cant not have any of it. I wish Obama would get more active in social media now! CRM: You talk about the contrarian approachwhats wrong with it? Curtis: Michael Port talked about [this] in his book The Contrarian Effect: If it worked before, then do something different. I kind of agree, but not fully. We need to look at our old practices but we dont need to throw everything away. Salespeople havent examined the way they operate for the past hundred years. Its incredible. Thats got to change. If it seems to work, people keep doing it even though it costs money and isnt terribly efficient. Think of field selling: People get on planes and they make presentations. That used to work but it doesnt anymore. People resisted telesales; they thought no one would spend $100,000 without actually meeting someone face-to-face. Well, that was the old way of thinking.
CRM: You dedicate an entire chapter to whats appropriate and what isnt on social networks. Can you explain what some of those things are? Curtis: Its common-sense behavior when you meet people: You shake hands with them before you hold out your card and launch into your sales pitch. In social media, people are pitching their product without creating relationships. We talk about the way to interact with people on social networks without coming across as too pushy, about how to create a strategy and the slow process of creating relationships: Put out content, listen to whats going on, find out where customers are. Thats more effective than putting up a fan page on Facebook and immediately starting to sell. CRM: Other than impatience, what big mistakes have companies made in utilizing social media thus far? Curtis: Companies arent being transparent. This is huge. You have to be able to be open and honest with customers. Companies have been hiding stuff forever. Thats why they have legal departments. If customers say things, you need to respond and be honest. Transparency is a risk, but its more of a risk not to [have it]. Another mistake is: How do you incorporate social into your culture? Bigger businesses delegate social media and just stay out of it. Social media needs to permeate throughout the company, from the top down. You have to have a whole new way of thinking when you adopt it. You cant just add it on as a stepchild. CRM: What would you say to companies that are concerned with return on investment (ROI) and whether they should implement social media? Curtis: Theres a lot of controversy about ROI right nowits so hard to measure. But as Andrew Gossen, senior director of social media strategy at Cornell University, said: I think five years from now the whole ROI question is going to seem nave. It would seem like asking for the ROI on your telephone service.What hes basically saying is that we shouldnt even be asking this question because its so clear that social media is worth it.
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PROACTIVE CRM
Take the Initiative

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ENABLES ORGANIZATIONS TO CUT COSTS, MINIMIZE RISK, PROTECT THEIR BRAND, AND IMPROVE CUSTOMER EXPERIENCES BY LAUREN MCKAY
IMAGINE A CUSTOMER RENTING A CAR TO MOVE THREE SHORT BLOCKS IN BROOKLYN, N.Y.
She calls on Zipcar, a membership-based car-sharing servicean alternative to buying or renting a car. After sweating in the July heat, hauling various household items up and down three flights of stairs, and making the same right-hand turns throughout several trips from one apartment to the next, her five-hour rental time has gone by in a flash. Suddenly, she finds herself nearing the rental deadline with not enough time to finish moving and return the car to the parking garage. Panicking, and checking her phone in disbelief at the time of day, she sees an SMS text from Zipcar, asking if she needs an extra 30 minutes. Elated, she texts back a oneword affirmation, and avoids a Benjamin-valued late fee and complete loss of her composure.
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COVER STORY
This is another step to reach the consumer and help them feel more at ease.
What Zipcar offers, an easy way to extend rental time, is nothing revolutionary. However, that simple proactive communication may be the difference between a consumers bad experience and a very good one. Paul Greenberg, president and founder of CRM consultancy The 56 Group, makes the point that many companies are pushing toward building more positive interactions. However, Greenberg underscores a corporate truism: Most companies dont do anything but react, anyway, he says. Proactive CRM, as we are calling it, is a departure from traditional, reactive behavior and aims to take early action that facilitates a desired result. It could be giving consumers what they want before they have to ask for it. In some cases it involves monitoring products and customers to solve problems before they happen. In more cases, its arming customers with the tools and information they need to accomplish their goals. Each of these practices would undoubtedly create more positive customer experiences. PROACTIVE SERVICE Southwest Airlines appears to be the poster child for proactive CRMthe airline has a branch of its company appropriately titled Proactive Customer Service Communications. Fred Taylor, given the nickname Chief Apology Officer in a New York Times profile, took charge of the team after being plucked from the companys front lines in 2007. Taylor, who presented at the 2010 Net Promoter conference, says he writes around 240 letters a year to Southwest passengers, often apologizing for unforeseen problems on flights or with travel scheduling. Chris Carfi, vice president at Edelman Digital and author of the blog The Social Customer Manifesto, was a lucky recipient of a proactive memorandum from Southwest in June 2007. Carfis flight to Oakland was disrupted by an unexpected stop in Omaha. A few weeks following the unpleasant plane ride,
Carfi found a note from Southwest in his mailbox, one explaining the reason for the unexpected landing, apologizing for the inconvenience, and offering a Southwest Airlines voucher for his experience. One might argue that because the letter arrived after the bad customer experience, it was more reactive than proactive. However, the voucher, when combined with the letter, is a proactive attempt to keep Carfi, and others, from taking their business elsewhere. The fact that they reached out proactively and communicated information in a timely mannerI thought that was phenomenal, Carfi remarks. According to Taylor, 70 percent of Southwest customers who receive proactive communications return to the airlineand bring others with them. We create a wow factorand a positive storytelling experience, he said at the conference. I am fortunate to work for a company that puts forth a lot of support and resources to make sure my team [can] accomplish our mission each and every day. But the fact of the matter is that not all companies have the culture that Southwest does. Some struggle with the reactive part of CRM. PROACTIVE SUGGESTIONS Carfi sees advancements in the way organizations will incorporate social media information into their customer engagement strategies. This would yield communications based on a consumers stated interests or buying history. Amazon.com has been a pioneer in this area. Businesses like Netflix and Pandora also excel at proactively suggesting new movies or music based on past behaviors. However, right now, suggestions and recommendations work well for companies with subjective products like music and movies. Despite a companys knowledge of customers and an engine that can generate what they might want next, customers might not be ready for recommendations in certain
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COVER STORY
sectors. While recommending movies or music is not likely to be perceived as stalker-like behavior, offering healthcare information would raise some eyebrows. Also, theres always the possibility that companies can go too far. The flipside is if the recommendations are too proactive, especially around things you might like, Carfi says. Knowing where to draw the lineIs this creepy or stalker-y?is important. PROACTIVE NOTIFICATIONS Proactive CRM can also give consumers the information they need to plan their day. Anyone who has ever waited around for a cable guy understands how frustrating it can be to plan an entire day around a service appointment. The best companies, Greenberg says, are the ones that now have developed sophisticated systems to carve out an hour time frame for arrival. Those things are great because even if they have a problem, its not a four-hour problem thats dragged into the 6th or 7th hour, Greenberg says.They give you the information you need so you can make the judgments you need to make. Home furnisher Arhaus Furniture has taken that facet to the next level. John Roddy, senior vice president and senior logistics officer for the company, spearheaded an implementation of TOA Technologies a few years back to not only cut down on the time that its customers had to wait for furniture delivery, but to give them the ability to track the delivery trucks and even view a photo of the driver. One of the
Proactive is...
Opt-in SMS chat Multichannel contact Social media monitoring and response Random acts of kindness
Reactive is...
biggest things we used to hear was that we didnt communicate with customers enough [on] the day of the delivery, Roddy says. With TOAs ETA solution, Arhaus makes automated phone calls to customers to give them an exact idea of when to expect a delivery. Changing the system has yielded fantastic customer satisfaction scores and feedback. Roddy reveals that about 90 percent of its furniture delivery recipients are females at home with children. Making sure the right guy is coming to the house is pretty important so we let them see a picture of who is going to be arriving at the door, Roddy says. This is another step to reach the consumer and help them feel more at ease. TOAs technology employs a predictive system that measures everything that happens in the field. Everything is reported and then the system takes a time stamp for every activity, via a realtime motion study. At the end of each month, TOA creates a performance profile for its enterprise clients. That is then used to estimate with a high degree of
Random offers Pitches Push marketing Damage control
accuracy when a technician will arrive at a customers home. PROACTIVE COMMUNICATIONS For wireless music system provider Sonos, being proactive means being pervasive. When Mike Carlino, senior director of customer service, came on board three years ago, about 85 percent of communications with customers occurred over the phone. Since then, the company has set up shop on social media sites, has developed a knowledge base for customer self-service, and has implemented online chat to assist customers. (For more on proactive chat, read How Can I Help U? on page 26.) Now only 40 percent of interactions are phone-based, according to Carlino. For every phone call, there are 15 page views of the online knowledge base. Carlino attributes the effectiveness of the solution to its consistent monitoring of issues that customers search. But still, Sonos puts a lot of emphasis on having a well-trained and friendly support team. If you view tech support as a jet engine, where you suck em in and spit
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One of the biggest things we used to hear was that we didnt communicate with customers enough.
COVER STORY
5 Proactive Pointers
Being proactive requires more planning. However, in addition to decreasing support costs, anticipating customers needs can increase customer loyalty. Here are five ways to ignite a sparkand to keep it burningwith your customers.
1. Allow customers to opt inand once they do, know what to do. If your customers have
opted in to your communications, they are putting their faith in your organization to provide them with relevant and useful information. Before troubling your customers for their email addresses, cell phone numbers, and social networking identities, figure out what you are going to say. Strive for consistent information that will save consumers the time and trouble of having to seek it out for themselves.
products and services. A little unexpected appreciation can go a long way.
4. Do chat the right way. To make chat work,

Diane Clarkson, a Forrester Research analyst, suggests that businesses base invitations on a predefined set of visitor behavior metrics. In other words, you dont want to chat up just anyone. (For more on chat, read How Can I Help U? on page 26.) Clarksons research indicates that 44 percent of online consumers say that having questions answered by a live person while in the middle of an online purchase is one of the most important features a Web site can offer. A successful proactive chat implementation doesnt end with a check mark next to the word done, Clarkson writes. Savvy eBusiness professionals understand that proactive chat success requires ongoing refinement of the business rules that will trigger chat invitations, staffing, and customer experience. Another rule of thumb? Dont annoy your customers.
2. Use proactive notifications. According a

published report by Forrester Research Vice President and Principal Analyst Elizabeth Herrell, proactive customer communications have the ability to reduce costs for incoming calls. By letting customers opt in to messagessent to their device of choicecompanies can convey information that is important to customers, whether it be a new offer, an account-related issue, or a time-sensitive alert. Being relevant and respectful of consumers attention ensures that the tone of these messages remains informative rather than intrusive.
5. If you have to react, be proactive in the response. Sometimes, being proactive means
assessing risk and implementing backup plans in case something goes terribly wrong. Gartner Research Vice President Jim Sinur writes in a recent blogpost about the concept of proactive scenario planning. Referencing the BP oil spill, Sinur states, The mess in the Gulf could have been avoided with the right ingredients. An appropriate remediation plan could have significantly minimized the environmental damage.
3. See past the dollar signs. Consumers will

figure out pretty quickly if your communications are only just ploys to get them to spend more money. Well targeted promotions are fine; just make sure they answer the ever-important question: Whats in it for me? Every so often, why not say Thank you to customers before blasting them with your latest and greatest
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COVER STORY
em out...youre not going to fare well in the long run, he says. Instead, Sonos focuses on longevity with customers and employees. Proactive communication can mean a company reaching out about an issue that a customer might have, but it also could mean giving customers myriad ways to connect, based on their preferences. Zipcar, for instance, encourages SMS correspondence, as well as mobile access of the site, and even unlocking the car with an iPhone. PROACTIVE PROBLEM SOLVING In April 2009, when two former rogue Dominos Pizza employees posted a vulgar video of their unsanitary acts in the kitchen of a North Carolina franchise on YouTube, they created a public relations firestorm for the company. A few years ago, the typical corporate response might have been to merely pull the video off the Internet and wait for the public relations storm to pass. However, as social media puts more pressure on companies to communicate and respond in real time, it requires organizations to change the way they conduct damage control. Dominos promptly responded on YouTube with a message of its own, featuring a video from Patrick Doyle, president (now CEO) of Dominos USA. While the response may not have fully restored the companys brand, its far better than doing nothing. Fortunately, thanks to social media monitoring tools and listening platforms, businesses can keep an eye on mentions of them in social networks, blogs, and forums. They can then respond or take action before the issue gets blown out of proportion as with Nestls Facebook fallout (see Crashing the Community in CRMs June 2010 issue). The problem with being proactive, as noted by Carfi, is that theres a level of let-go required to make these things happen. Theres definitely a connection between the proactive conversation and the general conversation around
transparency, Carfi says. Being proactive you have to be transparent. Not surprisingly the companies mentioned here for their proactive efforts are cutting edge, less traditional organizations. Why? Shifting from reactive requires a culture change and its hard for a company that has deeply engrained processes to turn the ship around. THE PROACTIVE PROMISE So wheres the benefit in all of this? Being proactive cuts down on consumers time and efforts, thereby improving the experience. Davids Bridal, for instance, the countrys largest retailer of wedding wear, has funds for random acts of kindness. Because the company closely listens to its social media mentions, it occasionally drops in and uses some funds to make a brides day. One such act of kindness left a brideto-be with more than just a warm, fuzzy feeling. She wrote about her situation one riddled with loss, challenges, and poor healthin combination with her dress shopping experience at Davids. The blog was so touching to Scott Rogers, the companys former director of strategic planning, that he asked for permission to reach out to the woman and offer up some goodwill on Davids behalf. Granted the means to do so, Rogers got in touch via Facebook and asked what his company could contribute to the wedding. She, of course shocked and a little confused by the gesture, suggested flowers. Not only did Rogers coordinate the flowers for this customers wedding, but he rounded up the biggest wedding card he could find and got all of the corporate employees to sign it. For Davids Bridal and this one special customer, being proactive was incredibly powerful. Although its not expected of Davids Bridal to be as generous with all of its customers, an occasional proactive effort can boost employee morale and make a huge difference for one customer. Associate Editor Lauren McKay can be reached at lmckay@destinationCRM.com.
A proactive effort can boost employee morale and make a huge difference for one customer.
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How Can I Help U?

Proactive businesses that utilize chat technology to engage Web visitors are seeing higher conversion rates. So why arent you?
Can I be assistan
u yo h Doeed y n ith w ele s
he sale is what matters. Every aspect of customer relationship management is geared toward securing new customers and retaining old ones. Billions of dollars are spent each year to funnel leads from product home pages, search engines, and social networks to company checkout pages. However, despite the effort (and the cash) spent enhancing this process, the majority of visitors still leave a Web site before completing a transaction. There are many benign reasons to explain this dilemma: Customers just want to browse, they came to the wrong place, or theyre doing research for a future purchase, among other reasons. But what about those customers whose credit cards are face-up on the desktop? Why have they abandoned the sales process that your business has spent so much time trying to cultivate? Chances are your business has done an admirable job tackling this problem: Youve
W yo ould co u lik 2 p mpa e to rod re uc the ts?
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// By Juan Martinez //
Do you have any questions?

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employed Web analytics tools to help determine what customers are doing when they visit your Web site (what they browsed, how long they stayed on a particular page, where they abandoned the buying process, etc.). These tools, while informative, typically produce reports the next day, week, or month, and they provide information that may reveal why potential consumers didnt buy anything. But by the time these reports are mulled over and acted upon, the customer has already gotten cozy with your competitor. Increasingly, businesses are becoming more proactive in the battle against abandonment. They realize it isnt sufficient to just know why customers didnt make a purchase; you have to stop them from leaving and ask. New tools exist that allow sales and service agents to know in real time who visits their prod-
before he actually hits your Web site. Armed with that knowledge, you can tailor the interaction. Once the interaction has been established, you can view the visitors activity and, if need be, initiate a live chat conversation to provide guidance, support, or market alternative products. Chat is such a great tool because customers [on your site] are [already] expressing interest in your products or services, Ott says. [You are] able to engage them at that moment and get them to the content theyre looking for, or you can actually capture them and encourage them to become a sales lead. People are finding dramatically higher conversion rates from Web traffic than they ever have before. O BIG BROTHER, WHERE ART THOU? An effective Web-tracking and outbound chat strategy allows you to
"Chat can dramatically increase engagement and conversion and get people moving forward in the sales funnel."
uct page, where the visitors have come from, how long theyre browsing particular pages, and what their browsing history is. When coupled with outbound chat technology that lets agents initiate instant message conversations with the visitor, you may never again have to witness a customer abandoning the sales process after spending five minutes at the checkout page. Most Web sites have a one-size-fitsall experience, says Greg Ott, chief marketing officer at marketing software provider Demandbase. Because of that, typical conversion rates are pretty low. Chat can dramatically increase engagement and conversion and get people moving forward in the sales funnel. With Demandbases technology, a Web agent can identify a business visitor
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understand and connect with customers; efficiently promote and sell products; provide real-time customer service; and prove to customers that you will cater to their needs (among many other capabilities). So why dont customers receive chat messages on every product Web site? What could possibly be wrong with an approach that is so clearly geared toward customer satisfaction? The answer is simple: Businesses worry that this particular type of surveillance might strike consumers as highly invasivea sentiment that could turn this customer satisfaction tool into the Internet equivalent of a garlic necklace. Businesses are able to find loopholes into similarly controversial monitoring techniques. For example, social media monitoring isnt viewed as invasive
because the customers being monitored are posting opinions to public profiles and have therefore surrendered any privacy rights; behavioral advertising is (according to marketers) anonymous and therefore not at all invasive (the Federal Trade Commission continues to investigate this issue). But with tracking and outbound chat the agent who watches a customers Web movements knows exactly who the customer is, and he will likely contact the customer and attempt to make a sale, at which point the customer will input vital information, such as an address, telephone number, and credit card information. Its unlikely, though, that customers will be comfortable leaving this information with an unknown chat agent. The Big Brother concept is [outbound chats] only obstacle, contends Mary Lee-Wlodek, president and chief marketing officer at Proactive Marketing, Inc., a business designed to create and implement unique marketing programs for professional service firms. People like the anonymity they believe they have online. Lee-Wlodek thinks companies should label the program in a warmer and friendlier way. Make it seem like a Nordstroms level of service, rather than calling it something IT-ish. Outbound chat allows for a warm and friendly approachthats what makes it so effective; it turns an electronic sales process into a human-to-human interaction. But its also the biggest hurdle. Software that monitors your online behavior is one thing, but to have a person watching you is a whole different story.Its kind of like people who just want to go to a retail store and browse and then theres an assistant standing by them just harboring, says Donovan Neale-May, executive director of the Chief Marketing Officer Council. [With tracking] youve got somebody sitting there watching me shop online [and] invading my space. Thats annoying. But Neale-May is confident that, if done the right way, outbound chat could provide a great vehicle for reducing abandonment and customer service
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inquiries.If its always presented from the standpoint of service, information, and educationthen it will be seen as a responsible beneficial service offering. John Pozadzides, CEO at iFusion Labs, developer of the real-time Web tracking and analysis software Woopra, agrees. Perhaps 5 or 10 years ago, he argues, before people were aware that the Internet could be monitored in such a way, outbound chat would have presented a much bigger issue. But because people recognize that its common for someone to watch them online, outbound chat has become a key technique in removing the cold and unfeeling stigma attached to e-commerce. We didnt know when we built this technology whether people were going to react like that, he remembers. His concern was that site visitors would first realize that companies were watching when the pop-up window appeared. Would that upset customers? Would they leave the site and never come back? No, Pozadzides says. We found out [customers had] the complete opposite reaction. Customers who couldnt find what they wanted, or who were confused by something theyd seen or read, were typically surprised someone was watching, but ultimately thankful for the muchneeded assistance. Like Neale-May, Ross Haskell, director of marketing at chat software developer Bold Software, also likens outbound chat to in-store sales assistance, a practice that he views as problematic only if done poorly. The reason people come up to you in stores and ask if you need help is because it works, he says.[Tracking and outbound chat] are pretty controversial topics among e-commerce companies. Ive spoken to a few companies and they say theyll never do live chat [because] it drives people away from their Web site.
Tangential Benefits
changing for one of his customers, a realtor who added Woopra chat and tracking to his Web site. The realtor went from handling one or two leads per month from people who were self-selecting to one or two leads per day from people who came from organic search. And if you factor in that realtors make 1.5 to 3 percent commission on each house they sell, with most houses worth hundreds of thousands of dollars, the ability to turn up the deal flow from a monetary standpoint would certainly change most peoples lives. iFusion Labs customers are avid evangelists of the companys services. According to J Andrew Hubbard, president and treasurer at Evansville Sheet Metal Works, iFusion Labs Woopra chat technology helps his company Web Site, Cut2SizeMetals.com, close sales, answer questions, and even fend off spying competitors. Some of our competitors are in small towns, so by using the location information in Woopra and their browsing patterns, we can detect which users seem to be fishing our site for competitive information, Hubbard says. When we find them, we use outbound chat to (nicely) let them know were watching, just as store security might give extra attention to people who exhibit behaviors consistent with shoplifting.
mproving the customer experience is not the only benefit of proactive chat. John Pozadzides, CEO at iFusion Labs, says the effects of his companys Woopra live chat and live tracking technologies were life-
[But] businesses that dont have live chat are missing a vital communication and engagement channel. Ott of Demandbase thinks its only a matter of time before outbound chat is a widely used practice among online retailers. Soon, he argues, customers wont want to waste valuable time struggling on your Web site when they can go to your competitors and receive one-onone service from an inbound or outbound chat agent. A lot of times [our] visitors are busy people and they end up on our Web site with an objective, he says. Chat is such a fantastic tool for
helping them achieve that objective. If Pozadzides and Ott are correct and outbound chat usage does continue to expand and become more commonplace on the Web, what will companies do to combat the stigma attached to the method? Lee-Wlodek argues that the transparency organizations have been practicing on social networks and in blogs will also have to be carried out on their Web sites. Instead of secretly scrutinizing what consumers are doing on their sites, organizations need to make it clear on the home page that theyre watching, and that they may attempt to
The ability to present the best and most relevant products to customers is what chat is really all about.
www.destinationCRM.com CUSTOMER RELATIONSHIP MANAGEMENT | OCTOBER 2010
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chat if they notice the customer has run into any issues. Allow the customer to opt into a tracking and outbound chat program, she says. In her opinion, chat is similar to pop-up ads; we came to hate them because we failed to appreciate that the sites we were accessing were only available because of pop-ups. CHATTY CUSTOMERS Despite the stigma associated with the technology, some companies are noticing early success. Media Cats, a software training provider, was able to accomplish four key objectives by using Woopras outbound chat after connecting with a local customer, according to Founder and President A.J. Wood. 1) The engagement provided a wow factor, because the customer loved that the company was engaging him in real time. 2) Media Cats was able to provide a direct answer to the information the
marketing, Haskell says. So much money is spent trying to drive traffic to Web sites. [But] once the traffic is there marketing professionals think they did their job. That isnt anything compared to getting traffic converted. Haskell argues that proactive chat, if done correctly, renders customers feeling like the shopping experience was actually a customer service experience. We find that proactive chat is a selling and conversion tool but its also a customer experience tool. Boston Green Goods, an online retailer of healthy home products and a loyal Bold customer, has been using the chat technology for three years, and the companys chief operating officer, Bob Scott, says chat is about more than just adding a button to your site that allows customers to ask questions. We wanted to be able to be in the right place at the right time to be able to offer [customer]
Customers arent going to go out of their way to get your attention; youve got to captivate them.
customer wanted. (Turns out this customer was a photographer, Wood says, and [he] wanted to know the difference between Photoshop and Lightroom software.) 3) Media Cats was able to keep the customer engaged and direct him to other areas of the Web site that he might have ignored. 4) And, of course, Media Cats closed a sale. Outbound chat isnt just about service and sales. Bold Softwares Haskell explains how his customers use Bolds proactive chat technology to market products to customers. According to Haskell, generating traffic to your companys Web site is only half the job. The ability to present the best and most relevant products to customers is what chat is really all about. We call [the presentation of products through proactive chat] after-click
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assistance, Scott says, or help [customers] select the right product and do it in such a way that were not being in their face. We dont want to alienate people and send them away from the site. The key to having successful chats with your customers, according to Ben Congleton, founder of live-chat technology provider Olark, is knowing when and how the conversation can be valuable. For example, organizations whose sales processes are complicated, expensive, and require interaction with a sales agent should chat with a large number of the sites visitors. [For these types of companies] no one buys through the site anyway, Congleton says. [So why not] get a conversation started. But on ecommerce sites, where shoppers dont necessarily need assistance each time they make a purchase, chats can be used
less frequently and for more servicerelated issues. Perhaps the best time and place to initiate an outbound chat is when a customer reaches a contact page. If someone arrives at your contact page, clearly they are trying to get in touch with you, iFusion Labs Pozadzides says. Based on that simple logic, why should the customer be forced to send an email and sit around and wait for your company to issue a response? With outbound chat, you can see that someone is trying to make contact and you can send out a message before the customer even begins to draft a message. With Woopra companies can create instant notifications based on all kinds of criteriaincluding when someone lands on the contact page. The agent who receives the notification can look at what the customer has been doing on the site and, rather than allowing a lead to just fill out a form and continue surfing to the next competitor on the Google search list, the company can chat with him and ask him if hed like to chat. Ninety-nine percent of the time [the customer will] say yes, Pozadzides says. Chat, which is in its relative infancy compared to most CRM technologies, still isnt utilized on a great number of Web sites. Companies are much more comfortable employing technology that allows customers to initiate live conversations with them rather than initiating the conversations themselves. But in todays competitive landscape many customers arent going to go out of their way to get your attention; youve got to captivate them however you can. Outbound chat allows your business to engage, enlighten, and assist customers who are already interested in your product. Dont let any more customers leave your site without asking if they need assistance. That one action could turn into a very lucrative life-changing chat. Editorial Assistant Juan Martinez can be reached at jmartinez@destinationCRM.com.
Bot
B Y K OA B E C K
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Anybodys
The definition of virtual agent seems to vary depending on who youre speaking to. Even the top three virtual agent companies have different opinions when it comes to what capabilities ultimately define a virtual agent. Mark Gaydos, vice president of worldwide marketing at VirtuOz, says that VirtuOz defines a virtual agent as having the ability to interact with a customer and, in a sense, understand what the customer wants to do and guide them to an answer to their question. According to Gaydos, the understanding component is what keeps Microsofts signature paperclip help feature, Clippy, from being considered a virtual agent. [Microsoft was] showing an avatar on top of a search engine and calling it a virtual agent, Gaydos says. [Avatars over search engines] have enough semantics to understand and know that restaurant means diner means coffee shop and it can bring results that are wider, but it really isnt having an interaction or a conversation [with the customer]. David Lloyd, CEO of IntelliResponse, agrees, explaining that a virtual agent is a way of interacting and delivering customer self-service. However, IntelliResponse stresses the search component as a major
Virtual agents, deemed the new concierge of the Internet, help customers navigate through ever-increasing Web site complexities
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VIRTUAL AGENTS
ingredient in providing customers with what they need, especially in an age in which many businesses have inadvertently overcomplicated their Web sites with too much information. [IntelliResponses] virtual agent platform allows our customers to rapidly implement a virtual agent that can deliver one right answer in mobile, social media, agent chat, agent voice, agent email effortlessly, says Mike Hennessy, vice president of sales and marketing at IntelliResponse. eGain gives considerable more weight to a virtual agent understanding text and speech input by a customer, as explained
with regards to some industries, such as travel agencies for example, others feel more inclined to alter the term to attract customers. VIRTUAL RESULTS Regardless of terminology, virtual agents are, across the board, being received well by customers of many industries. One of eGains U.S. customers, for example, concluded that it was able to offload 30 percent of customer queries at a 96 percent resolution rate. In the Bloomberg Businessweek piece, Virtual Agents Will Replace Live Cus-
Because so many businesses now strive to make personalized experiences for their customers, virtual agents can also provide a more cost-effective way to tailor experiences for consumers.[Businesses are] creating experiences that are more personalized, less mechanical.... [There is this] same notion of, How do you use technology to create a perception of intimacyof familiarity without spending a lot of money? Roy poses. A chatbot is one of the tools in that exercise. Its a tool that creates a perception of human-like interaction, if blended well. [Virtual agents] need to blend well
I think people like to get answers to their questions and theyd prefer not to interact with a person. Most people want to be self-reliant.
by Ashutosh Roy, chairman and CEO of eGain. Our definition would be [that] a virtual agent is a human-like bot that understands natural language interactions and guides a visitor though a conversational interface using text and/or speech input and output, Roy says. To further complicate terms is the differentiation between virtual agent and virtual assistant, as eGain referred to its virtual agents as virtual assistants before renaming them as chatbots in 2007. Diane Clarkson, online customer service analyst at Forrester Research, maintains that these variations are simply a matter of semantics, as virtual agents only differ slightly. Many [virtual agents] do similar things but [companies] call them something different because people were dissatisfied with virtual agent. Some of them are called something different because [businesses] didnt like the term, Clarkson says. I think the word agent doesnt always work for people.Virtual has an Xbox connotation. Agent doesnt always suit the terminology for the industry. Clarkson points out that while some customers find the word agent intuitive
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tomer Service Reps, Gaydos wrote,Virtual agents are already augmenting and replacing human support personnel. You dont need fancy arguments to explain this phenomenon (we have built computers to beat chess champions, so having them help customers with bill disputes is a walk in the park). VirtuOz determined that SFR, a division of the mobile communications enterprise Vodafone, uses a virtual agent to facilitate 750,000 conversations a month regarding customer account questions and the companys services. eBay, one of VirtuOzs customers, is already facilitating 200,000 customer conversations a day with virtual agents in six different countries. Virtual agents are effective in dealing with specific customer questions because of what Roy refers to as the 80/20 rule. This standard distribution relies on the fact that 80 percent of the questions asked by customers revolve around only 20 percent of the topics. Although this logic has been applied to generating FAQ lists, Roy asserts that this reasoning can be applied to virtual agents as well.
with human conversation. Over time, what you want is that the visitor should not be able to tell the difference between the virtual assist or a human being responding in a seamless conversation. GROWING INDEPENDENCE Analysts and vendors agree, though, that what most appeals to customers about virtual agents is the opportunity to be more self-reliant. In a recent Harvard Business Review blog, Why Your Customers Dont Want to Talk to You, Matt Dixon and Lara Ponomareff determined that three to five years ago, two-thirds of customers primarily used the phone for service interactions. At present, less than a third do. However, of that one-third, 57 percent first attempted to resolve their issue on the companys Web site. And, in addition to that, over 30 percent of all callers are on the companys Web site at the same time that they are talking to a representative on the phone. I think people like to get answers to their questions and theyd prefer not to interact with a person. Most people want to be self-reliant. There is an obligation that goes along with interacting with a
VIRTUAL AGENTS
person. Most people want to do their own thing, Gaydos observes. Younger customers, in particular, are demonstrating a trend of perusing the Web for their own answers to inquiries, opting to search Google or forums rather than pick up the phone. With this trend comes a tremendous opportunity for virtual agents to assist in the process of self-service. As the younger generation becomes more influential in terms of overall spend, companies will have very robust self-service, particularly on mobile devices and possibly on in-store kiosks, Clarkson says. As virtual agents become more widely adopted by Web surfers, the skew towards younger will shift. Lloyd agrees, pointing out that this trend makes sense considering the younger demographic isnt tethered to a laptop or an office. Most college students are choosing to resolve problems via their mobile devices, remaining stationary only for the moments it takes them to check Facebook, which, incidentally, can also be done remotely. Athabasca University, a Canadian institution specializing in distance education programs and courses, has been well aware of its students mobility and, in 2003, began using IntelliResponse agents to address the growing volume of requests in its Information Center. In what it has aptly named AskAU, Athabasca University has already successfully integrated virtual agents into Facebook and iTunes using IntelliResponse applications. But in February 2010, Athabasca Universitys internal development team went a step further and created Sunny Davros, a virtual Second Life agent who inhabits AU Island. The creation of Sunny Davros in Second Life is an extension of work with conversational agents that had been conducted at AU over the last five years or so, says Michael Shouldice, senior recruitment officer of Athabasca University. As social media began to grow we, as did IntelliResponse, recognized that it was important to be a part of the conversation. When IntelliResponse offered
the Facebook and iTunes app functionality it only made sense to include these offerings. Our students, who study with us around the world and around the clock, now have a number of access points to seek answers to their questions about AU when and where they want to. Behavioral trends aside, the noisiness of so many company Web sites is causing customer self-reliance to become more prevalent in the older demographic as well. Lloyd concurs, admitting that The younger [demographic] has a shorter attention span, but its not a situation that is [necessarily] relegated to the younger demographic...this is only going to spread more rapidly.Lloyd points to the growing demand for smartphones, a product that is sought after by consumers of all ages. Because many company Web sites have become so overwrought with information, Roy argues that virtual assistants have the potential of being the concierge through the online experience for all demographics. According to Gaydos, many companies have unintentionally made their Web sites more complicated than ever, adding endless pages of information to accommodate questions. This tactic has, in turn, made Web site navigation much more difficult for customers hoping to locate a specific answer. On your Web site, no one can hear you scream, Lloyd adds humorously when describing the frustrating experience of mining through Web sites.
Gaydos also uses the word concierge when explaining the role of the ideal virtual agent, adding that customers should not be inundated with so many details, loopholes, and special circumstances regarding their inquiry. The robots are here to help you and they have warm hands, Gaydos says.You dont want the customer to know all that information.... [The virtual agent should] figure out all the rules so the customer doesnt have to. Thats what [VirtuOz] means by shepherding the customer. [VirtuOz] hides the complexity from the customer. Gaydos uses the metaphor of choosing the perfect wine to illustrate his point: Its the difference between giving someone a wine list and asking them to choose and someone who talks to you and asks you, Whats your price point? Its about honing in on those key things that is really problematic for your customers.... The information is on the Web site. They just cant find it. TO BOT OR NOT? Although virtual agents should be able to guide a customer through more involved questions, the point at which a human agent should be reached is uniformly acknowledged as the big three: the cancellation of service, cross-sell or upsell opportunities, or to deal with a high-value customer. However, Clarkson notes that there are some small exceptions when it comes
Students at Athabasca University can visit AU Island in Second Life and ask Sunny Davros questions about the university at any time, from any location.
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to cross-selling, specifically regarding higher-volume, lower-volume revenue. She uses the example of an iPod and an iPod skin when she says, Higher-volume-lower-revenue-additional items can be very important to improving a customers experience. A customer who is buying an iPod online might appreciate being offered a multicolored skin to accompany that purchase, an offer than can be entrusted to a virtual agent primarily because of the low cost of that item. [That] customer will walk away with a good experience, Clarkson adds. Although many customers are becoming increasingly more receptive to this type of self-service, phone calls still have the highest resolution rate over any other channel. This schism between customer behavior and problem resolution can be explained in a customers willingness to go with the faster option. The big issue with the phone is that it isnt necessarily faster than self-service or chat, particularly for low or medium complexity issues, Clarkson says. It requires getting to the right person, being on hold, [and] having to explain the situation. The phone also isnt as private as self-service, particularly for consumers who are multitasking and trying to resolve customer service issues at work. Analysts and vendors agree that a customer engaging with a virtual agent should have ready access to a human agent, should the customers satisfaction begin to wane. [eGains] approach here is that we have a common platform that provides a core set of services around a common knowledge base, Roy says. The way it works is the virtual assistant is set up to escalate depending on configuration. [You can] either go to a chat channel or a click-to-call phone conversation, and you can set it up so that there are [specific questions, such as], Whats the price of your software? Thats a typical escalation product. Escalation can be far out of the domain of the chatbot. It needs a human assistant. One company that uses eGain software always keeps a human agent nearby,
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often keeping a close eye on the exchange between virtual agents and users. If the chatbot is not able to resolve a query to a customers satisfaction, explains the customer, it offers to escalate. eGains unified multichannel Customer Interaction Hub allows seamless, context-aware escalation to an agent (e.g., chat agent), where the chat agent is fully aware of the customer interactions with the chatbot and does not need to repeat the same questions. This constant monitoring of virtual agent and customer exchanges is the most efficient way to use virtual agents, Roy says. He advocates an eventual indistinguishable voice between virtual agent and human agent that should go undetected by the customer, punctuated with proactive offers, of course. FUTURE BOT GENERATIONS Clarkson deems virtual agent technology as very forward thinking, but points out that the future of the industry will go hand-in-hand with language processing. A virtual agent is only going to be as good as the natural language processor, which is related to the vendors, Clarkson states. Roy agrees, explaining that to his knowledge, all vendors currently lack the speech interface to create a truly seamless experience. You want to be able to just chat to this bot and the bot should be able to respond with speech and take you to the right place on the Web site, Roy says. That piece is still missing. That interface needs to be more natural. Another component that needs to be constantly improved upon is the knowledge of the virtual agent. In assisting customers with an ever-expanding collection of questions, virtual agents must be prepared for any new developments, no matter how minor. You have to maintain the knowledge of the virtual assistant, Roy advises. Theres no easy way for the chatbot to automatically leverage existing knowledge in the system. Its very frustrating. It starts to bog you down because you have to keep
updating the know-how of business systems and thats a gap that I see in the second generation. Like eGain, providers are starting to address [this need]. Another challenge for the virtual agent industry is keeping the agent constant across multiple channels, a challenge that Gaydos says is necessary for the evolution of the industry. The way virtual agents are going to go is that theyre going to get more intelligent, more pervasive, Gaydos envisions. Youre going to see them appearing consistently across channels. [Right now], there is a huge channel conflict problem...you want that consistent concierge. No one has nailed this that I know of. Similar to Roy, Gaydos expects to see virtual agents with human overlords, overseeing these many conversations and intercepting when necessary; Gaydos also expects to see virtual agents communicating with other virtual agents, sharing customer information and the context of inquiries. Clarkson believes that search site boxes will eventually become extinct along with FAQs due to the virtual agent. I would see virtual agents becoming much more crucial to the online self-search function. [Virtual agents would become] much more sophisticated and replace a lot of self-service content...it could become the core part of the self-service help section, Clarkson explains. Others speculate that virtual agents will complement conventional customer interaction as they become more popular, particularly with voice interaction. Theres going to be an inflection point largely around the speech-based experience, Roy predicts. You visit a Web site on your smartphone and if you have a question you can just speak your question...[like a] personal assistance application. Yet, when Gaydos is asked if virtual agents will eventually come to replace human agents altogether, he says, they already are. Editorial Assistant Koa Beck can be reached at kbeck@destinationCRM.com.
enjoys shopping for handbags and jewelry wears a size 10.5 EEE shoe
likes to receive sales offers in the fall
A Catalog of Contacts
With Unicas marketing software, Sears Holdings gains some newfound customer intelligence
ot so long ago, if you were a Sears customer, youd probably frequent a specific location, and the clerk behind the counter often knew what you wanted before you asked. Those days are long gone, forcing some significant adjustments in how Sears reaches out to its clientele. The recent changes at Sears and parent company Sears Holdings werent about marketing strategy, thoughthey were about the methods involved in deploying that strategy. And when the nations fourth-largest retailer decides to
make a shift in marketing, the industry information from all those transactions, so that it could market to its consumers tends to notice. In addition to approximately 3,900 as intelligently as it always had. Until October of last year, says Tony full-line and specialty retail stores in the United States and Canada, Sears Hold- Arnold, director of CRM at Sears Holdings is also the nations largest provider ings, the company relied on an army of of home services, with more than 12 mil- database experts for the arduous task of lion service calls made annually. Over- pulling customer information out of a all, the company generated more than data warehouse, developing segmentation, $46 billion in revenue in 2009, according to CNN.com. A com- We have to understand what the customers are pany that once prided itself on commenting on. Knowing what the customers want customer knowledge, Sears was grasping for a way to capture is what CRM systems are built for.
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and performing suppression. Code reuse platform made Sears communication was extremely difficult, as was develop- efforts easier and much more efficient. In ing any type of campaign history. Also, the first six months after the October because each of Sears 33 business units launch, Sears Holdings initiated 726 marmarketed within its own silo, the com- keting campaigns, 689 of them via email. pany was running 33 different email- Averaging 63 campaigns a weeka tremarketing campaigns. Some customers mendous increase compared to the four or five per week beforethe company received 400 emails a month. Arnold says Sears decided an easy-to- made 4 billion customer contacts, and use platform was the best way to coun- 100 million trigger-driven contacts. Less teract the companys difficult business than 1 percent of the marketing camprocess. We needed the ability to use paigns were late and, despite the sharp code, to understand the history of increase in outreach, the campaigns sufcustomer-contact strategies, and to un- fered not a single production error. Arnold claims the new strategy pushed derstand how and when we were contacting these customers, he recalls.[We the company 3,000 percent beyond its wanted to] bring the need for very expe- original scope, and, as of May, email volrienced [programmers] down to a less- ume had increased an average of 50 perexpensive level to push out a high cent month over month.Were way over what we purchased the system to handle, volume of campaigns. he explains. We originally With se ver al goals in wanted to push out 36 cammindto better understand The company paigns per month. Were at customer behavior, provide was running 240 campaigns per month targeted email marketing, per33 different and were growing every sinform contact management gle month. control, and execute basic re- email-marketing So whats next for a sucportingSears eventually campaigns. Some cessful retail giant with a chose enterprise marketing newly solidified strategy for management software from customers received Unica, which showed an abil- 400 emails a month. marketing automation? Soc i a l m e d i a , o f co u r s e . ity to handle the companys ever-growing volume of information. Arnold says that Sears Holdings is now Unica also generated visible code that looking to use Unica to drive social netcould be hand-edited, which allowed it to work initiatives. The company wants to integrate well with other platforms. For further enhance the relevance of its adwhat was available on the market, its ca- vertising by listening to what customers pabilities, and the need that Sears had, are saying on sites such as Facebook Arnold says, Unica was the best value. and Twitter. We have to understand what the (Unica has since been acquired by IBM.) With Unicas support, Sears developed customers are commenting on, Aran email opt-in preference center for col- nold explains. Knowing what the cuslecting customer information. The goal tomers want is what CRM systems are was to deliver better marketing materi- built for. Juan Martinez alsoffers that were more relevant and better targetedthrough an improved understanding of the customer, such as SINCE IMPLEMENTING UNICAS what products she buys each year, when ENTERPRISE MARKETING MANAGEMENT, SEARS HOLDINGS HAS: she likes to receive offers, what size shoe launched 726 marketing campaignsan she wears, etc. The guy behind the average of 63 per week, up from five more than 99 percent of them on time; counter in the old Sears shop knew that attained 100 million trigger-driven contacts; kind of stuff, Arnold says. Im trying to gained 4 billion customer contacts, an get us to a point where were communicataverage of 114 million a week; ing with our customers in the same way. suffered zero production errors; and While nothing may ever be as simple as seen the volume of outbound emails grow 50 percent month over month. face-to-face communication, Unicas
To Predict and Serve

Predictive analytics helps a police department make better use of limited resources
the payoff
RM may more often be found in the boardroom than in the courtroom, but one local police departments investment in predictive analyticsand a subsequent drop in crimemay herald a drastic expansion of CRMs capabilities. In the past, the Prince Georges County Police Department (PGCPD), in Landover, Md., would have to manually prepare data on active crimes each morning. This labor-intensive and time-consuming process required the participation of specially trained officers, and often delayed the delivery of critical information. The PGCPD has implemented some new software, howeveran application called Active Crime Report (ACR) and WebFOCUS Rstat from the vendor Information Builders. ACR allows police officers to get information on demand, with data automatically updated every 15 minutes. Officers of any rank, regardless of technical skill, can run reports and look for information, monitor incoming calls, learn where crimes are
38
occurringand not only respond more PGCPD meetings: On his laptop, Hylton quickly, but anticipate when specific dis- can pull up information on any districts crimes to examine the real data and districts require a shift in policing. ACR allows us to be proactive instead cuss strategy with fellow officers. The entire department now gets realof reactive, says PGCPD Lt. Henry White. Investigators and crime analysts use ACR time information from the always-on as an internal search engine, prepar- application. I use the system all the ing officers to anticipate circumstances. timefirst thing in the morning, last They can query the system for the details thing at night, and throughout the day, needed to solve any type of offense: the Hylton says. It literally makes it possible person who fielded the original call; po- for me to know whats going on in the tential patterns; and information on the field and the department at every minute suspects, victims, or vehicles involved. of the day, and to plan our strategy accordingly. Its definitely helping The optimized data entry us reduce crime in the county. and access are a boon, of ACR allows us In other words, smart softcourseand ACR also enables to be proactive ware makes smart cops even officers to answer citizens questions more quicklybut instead of reactive. smarter. Our approach is intelligence-led policing, Hylthe true benefit for PGCPD is the improvement in resource allocation ton says, and ACR is essential. It gives that the system has made possible. Officers us confidence. It keeps us from being no longer burdened by manual data entry blind. I need to know what occurs are able to spend more time patrolling throughout the day, and the officer needs to see whats happening on his areas where crime is actually occurring. Soon after ACR was implemented, beat. Now we know how to protect ourfor example, a local politician asked for selves and the community. PGCPD is now looking to push its information on a high-priority case involving a missing person. In the pre- predictive analysis even further, using ACR era, simply identifying the officer data and resources to anticipate criminal who had taken the original call or been activity before a crime is even reported. assigned the case would have taken an At present, the department is using ACR unpredictable number of phone calls. to focus the manner in which it handles This time, however, an officer was able car thefts, analyzing trends such as the to access ACR and locate the relevant types of cars stolen, where theyre stolen from, and where theyre found. information within seconds. ACR has fundamentally changed how PGCPD officials credit the quick and and effective implementation of ACR for the officers of PGCPD are performing helping produce some startling suc- tasks, automating some of the departcesses: Total violent crime in the county ments slowest, costliest, and most mandropped by 11 percent from 2008 to ual processes. By getting better, more 2009, with 21 percent fewer homicides timely information, presented in an and a 25 percent reduction in auto theft. easy-to-grasp, accessible style, the offiThere were also 73 percent fewer carjack- cers of Landover, Md., are definitely taking a byte out of crime. Koa Beck ings in 2009 than there were in 2005. PGCPD Chief Roberto Hylton says he checks his BlackBerry before dawn every morning to track crime statistics on WITH PREDICTIVE ANALYTICS ACRand that he expects his com- PROVIDED BY INFORMATION BUILDERS, THE PRINCE GEORGES COUNTY POLICE manders to do the same throughout the DEPARTMENT HAS SEEN: an 11 percent reduction in total violent day. When crime rises above an estabcrime between 2008 and 2009; lished norm in any area in the county, a 21 percent reduction in homicide; the chief connects with the appropriate a 25 percent reduction in auto theft; and commander, who will likely have already a longer-term reduction in carjackings deployed additional officers to that area. (down 73 percent from 2005) and auto theft (down 60 percent from 2005). ACR is also a staple in upper-level
in this issue
CRM USER COMPANIES
References are to the first page of the story or section in which the company appears. Arhaus Furniture .................................................20 Athabasca University.........................................32 Boston Green Goods...........................................26 British Sky Broadcasting ..................................12 Cleveland Clinic..................................................12 Davids Bridal .............................................20, 41 Dominos Pizza.....................................................20 eBay.......................................................................32 Evansville Sheet Metal Works.........................26 Media Cats ...........................................................26 Prince Georges County Police Department..............................................38 Sears Holdings ....................................................37 SFR (Vodafone) ....................................................32 Sonos.....................................................................20 Southwest Airlines.......................................4, 20 UnitedHealthcare................................................40 WebMD .................................................................12 Yahoo! Health ......................................................12 Zipcar ....................................................................20
ADVERTISERS
Fellow Consulting...............................................15 www.crm-20.com inContact ..........................................back cover www.inContact.com/profitability 1-866-965-7227 ITI Magazines..................inside back cover www.infotoday.com/periodicals 1-800-300-9868 Parker Software..................................................13 www.Email2DB.com info@parker-software.com 1-800-680-7712 Pivotal CRM ............................................................7 www.PivotalCRM.com 1-877-748-6825 Verint ................................inside front cover www.IntelligenceInAction.com
the payoff
WEB EVENTS
Oct. 20, 2010: Webinar Informatica .................9 http://webinars.destinationcrm.com/informatica/275/ Oct. 27, 2010: Webinar Online Roundtable ...11 http://webinars.destinationcrm.com/roundtable/276/ On-Demand Webinar Pivotal CRM...............17 http://webinars.destinationcrm.com/cdc/273/ On-Demand Webinar InsideView...................31 http://webinars.destinationcrm.com/insideview/271/
A Healthy Dose of User Adoption

UnitedHealthcare overhauls its CRM program to embrace an on-demand solution that users will actually use
im Lane is happy to have taken his and with a team of supporters chose to medicine. As the vice president of na- stay with Oracle as the companys CRM tional accounts for UnitedHealthcare vendor. (Oracle had acquired Siebel (UHC), a carrier handling the health- back in 2005.) This time around, howcare accounts of millions of individuals ever, UHC would opt for CRM delivered via the software-as-a(and the healthcareservice (SaaS) model, spending accounts of in the form of Oracle many more), Lane knows CRM On Demand. his company now has the Rather than sink opportunity to use CRM deeper into the existing as a differentiator. on-premises system, we Unfortunately, that decided to move forward wasnt always possible, with a new solution, thanks to an antiquated Lane says. We didnt on-premises solution have a capital budget so and a group of salespeothats when we started to ple who were less than look more closely at a inclined to make use of SaaS solution. Not surit. In 2002, Lane recalls, prisingly, UHC was UHC implemented a We had the advantage of won over in part by the CRM solution from most common benefits Siebel Systems that took knowing what failed in our past 20 months to develop system so we knew what to avoid of an initial switch to SaaS: the freedom from an interminable period having to maintain any that actually wasnt all and we knew what to strive for. infrastructure and the that uncommon at the time, given the size of the deployment. promise of up-to-date software features Just four years later, however, the system without labor-intensive upgrades. Before the go-live of Oracle CRM On Dewas already in failing health. The cost to keep it current and to mand, UHC executives held an off-site keep up with advances in technology summit to gather feedback from some of and user interfaces became too great the companys sales leaderswhat salesand too much for the company to swal- people felt they needed to effectively low, Lane says. To make matters worse, close deals and how a CRM system could salespeople were no longer showing af- help them manage new accounts. We had the advantage of knowing finity for the solution. Adoption started out highroughly 80 percentbut what failed in our past system so we knew usage later foundered, dropping to a what to avoid and we knew what to strive for, Lane says. We had both sides of the lowly 20 percent in 2007. UHCs CRM was in desperate need of equation in front of us. Throughout the a face-lift, but given tight budgets and implementation, UHC kept what Lane parameters, there wasnt room for an- refers to as a limited-budget mentality. other failed implementation. Lane took There was no safety net, he says. Because of strict adherence to budget, charge of implementing a new solution
40
schedule, and objectives, the project was completed on time and under budget and went live in December 2008. However, as with many CRM implementations, the official launch was just the beginning. With Phase 1 rolled out to users, UHC expanded the scope of the systems offerings, adding components such as sales intelligence and customer survey resultsboth of which, Lane reports, significantly impact sales reps compensation. The CRM application is now more than just a place where salespeople are obligated to record their pipeline status, Lane says: They can also get information from the CRM [system] about information pertinent to them. In addition, UHC gave its salespeople access to InsideView, a SaaS solution that aggregates sales data from traditional and social media. (InsideView was named a Rising Star in CRM s 2009 CRM Market Awards.) That second round of CRM add-ons had a serious effect on user adoption. Following Phase 1, adoption of Oracle CRM On Demand hovered around 60 percent. That figure has now risen to the 80s, and Lane predicts that it will cross 90 percent once UHC implements a business-planning solution thats in the works. Aside from a tremendous boost in adoption, Lane says overall effectiveness is also vastly improved. With Siebel, he says, sales reps had become lazyoften asking an administrator to handle updating their sales numbers. It was a terribly inefficient way of capturing relevant and critical CRM information, Lane says. Now, the CRM system encourages accountability and increases productivity. Staffers even bestowed a pet name on the solution: Merit. They came up with [that], Lane says. [Its] described as having value and quality. Lauren McKay
the payoff
SINCE IMPLEMENTING ORACLE CRM ON DEMAND, UNITEDHEALTHCARE HAS:
reduced the number of clicks required to navigate its system by 25 percent; cut by 29 percent the amount of time needed to enter information; saved 33 percent in system-maintenance costs; and increased user adoption by 81 percent.
SECRET OF MY SUCCESS
Something Borrowed, Something Blogged

Marrying a variety of voice-of-the-customer approaches, Davids Bridal tries measuring sentiment among social mediasavvy brides
Tell me about your experience at Davids Bridal managing a voice-of-the-customer (VOC) program. Eleven years ago, when I
first arrived, we didnt have any VOC program at all. With no money for customer research, we were doing mystery shops and tiny customer satisfaction surveys. May Company bought us [in 2000] and showed us how much we didnt know about our customers. We then started outsourcing research and getting deeper into the whyslistening to the customers. We later signed on with Vovici and started to bring everything VOC in house, which proved to be cheaper and faster. Back in 2007, as social networking got more popular, I started looking at what people were saying about us. A year later we signed on with Nielsen BuzzMetrics to track some of the mentions of our company online. We got quarterly reports telling us how many mentions our brand had, but as far as sentiment and topics [of conversation], the service fell short. Scott Rogers, In June of last year, when Radian6 said [it was] So what have you learned about Davids Bridal FORMER DIRECTOR OF coming out with a sentiment tool on [its] platcustomers? We were trying to not only better STRATEGIC PLANNING AT DAVIDS BRIDAL | form, we signed on. Reason being, brides like to understand our customer, but answer what we as told to Lauren McKay talka lot. The conversation goes on and on, but need to do to change service and support. One its hard to follow the sentimentespecially on of the end goalsa social network site of our blogs, [where] theres usually multiple sentiments expressed. own that would support our customers and build a peer-toEven with Radian6, it was hard to match sentiment with what peer forumis still in the works, [but] the findings have our customers were actually doing. In November of last year, been fascinating. Depending on the channel, the sentiment when Vovici did a webinar with Attensity, they addressed all changes: If its a blog, theyre telling friends whats been hapof the issues I was having. I thought, This is fantastic! and pening. If its a forum, theyre looking for advice. On Twitter, immediately wanted to learn more about it. its usually, Im going to Davids. Facebook is all about keeping up with your friends. When you break down the topics, it Can you elaborate on what was missing in your customer in- gets down to the old product-and-service component. It sights? Stepping back a bit, we brought on SPSS Text Analyt- doesnt necessarily have a lot to do with process and systems and stuff like that. The ultimate goal is to respond, so that its ics in 2005. [Editors Note: IBM acquired SPSS in 2009.] Its pervasive, and to restructure customer service so it can hangreat and gives you interesting word clouds based on cusdle that. Brides like to talk, after all, and in my opinion, tomer conversations, but when trying to make sense of strings everyone is an influencer. Everybody matters. of words, its a bearyou [have] to do the heavy lifting. Because Im in [the online forum known as] the Social CRM Accidental Community, I went to those guys for help. It was [industry consultant] Esteban Kolsky who said, AttenWHEN DID YOU IMPLEMENT ATTENSITY ANALYZE AND SURVEY sity is by far the best thing thats out there. The difference is ADVANTAGE? November 2009 that Radian6 and BuzzMetrics use a keyword-proximity techWHO HELPED WITH THE DECISION? The #SCRM pioneers [on nology. So if a post is long, you cant follow it. The sentiment Twitter], mainly Esteban Kolsky. must be close to [the content] youre looking for. BEST FINDING? Realizing that we need to be measuring topics of With Attensity, you can follow sentiment wherever it may be. conversation rather than the number of people talking about us. Take, for example, customer satisfaction surveys. Davids Bridal BIGGEST CHALLENGE? Allocating the resources. sends it out to everyonewe received 200,000 comments a WHATS NEXT FOR DAVIDS BRIDAL? Building our own peer-to-peer social network. year ago. The comments are the most important part because scores dont necessarily tell you what you need to do. When we wanted to get into detail, we used to go through the comments randomly and read them and code them according to the content. With Attensity, the advantages are threefold: Scale: You can go through a million of these in seconds. You dont have to have a personal filter. Consistency: When we used Radian6 for sentiment, our PR agency was also doing reports. The problem was we would come out with two different viewpoints. I was trying to code only customers talking, but Radian6 would give us posts from everyoneindustry insiders (photographers, cake people, and wedding planners) as opposed to just customers. Through Attensity, we only run the posts of customers talking. Filtering: I can code the URLs that I dont want to see and cut out 25 percent to 30 percent of nonrelevant content.
five fastfacts
41
MARSHALL LAGER, OCTOBERS CHIEF ESPIONAGE OFFICER
Pint of View
(Proactive) Service with a (Secret) Smile
If you feel like somebodys watching you, it just might be CRM in action
P R O AC T I V E is a funny word. Many of us use it like filler as an adjective (or, with -ly, an adverb) to round out a sentence and make it sound professional and erudite. It gets harder when proactive is applied to CRM. The wannabe motivational speaker in me wants to say something pithy, like Proactive means pro(fessional) and active. I could make an argument for why thats a good way of looking at the problem, but its just too on-the-nose, so lets save it for another day. The core principle of proactive CRM takes social CRM and ratchets it up a notch. Social CRM uses everything a company knows about a customer or prospect from every available source, from transactional data to public comments, to determine what that customer is likely to want. But to be truly proactive, the company has to act before the customer has stated a preference in essence, before the customer knows what she wants. That kind of CRM requires psychics. The local tarot-card readers will be glad to know they have a new career opportunity emerging. Chances are, psychically proactive CRM will never come to pass. Its creepy enough when friends know what were thinking before we do. When a business does this, customers will start looking for hidden microphones, cameras, and keyloggers. Tracking cookies already got a bad rap once (unfairly), and the uproar accompanying a round of scary-accurate CRM guesses will bring out the pitchfork-and-torch crowd right quick. Thinking more deeply about proactive CRM, I realized that I was ignoring something. When youre at a restaurant, you dont want to have to ask the waiter to refill your water glass.
42
At the same time, though, you dont want him to interrupt your meal and ask, Hey, howd that most recent water-delivery interaction optimization go for ya, buddy? The best customer service (or marketing campaign, for that matter, or sales pitch) is the kind you dont noticethe glass just gets filled. Its not always possible to lay out whats needed before its requested, but todays customer-facing workers have at least figured out that offering alternatives is better than waiting to be yelled at. When its clear that a customer is cooperating toward a common goal, the employee can make the intuitive leap to get the job done quickly and cleanly. (This opens up some possible problems when customers themselves arent clear on what they want, but thats business for ya.) Ideally, though, proactive should be invisible. When a certain TV commercial starts getting on your nerves, the company will just change the campaign. Your computer is running slower than usual, so tech support will simply patch the operating system. Uncanny circumstances pile up to enable the customer to reach out a hand and have the perfect solution delivered. The best way to achieve this? CRM ninjas. Striking from the shadows when your back is turned, these shadow warriors enact devious plans to get you precisely what you want, exactly when you want it. Yeah, because having trained assassins stalking you to find out your commerce preferences is way less creepy than hidden cameras.
Marshall Lager is Agent Double-O-Nothing for a spy agency whose cover is Third Idea Consulting. Contact him through his mail drop at marshall@3rd-idea.com or exchange code words with him via www.twitter.com/Lager.
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