Trench Warfare in the Digital Age: Relationship Marketing Makes a Comeback
Last session, huzzah! While the exhibit hall shuts down, we’re going to learn about reputation management. Moderator John Stichweh (Critical Mass) gets us started. Panelists are Benjamin Hill, Andy Shih (Proctor & Gamble) and Jeff Rohrs (Exact Target).
First question, what is CRM?
Benjamin: We don’t really use that term. We use the term personalizing. The question really is who are we trying to have a communication with. We use personal marketing because it shifts the focus from us to what the customer needs and wants. We want to get inside the heads of the people that we’re trying to communicate with.
Andy: Consumer relationship marketing. They want to improve the lives of the world’s consumers. It’s about a two way relationship that creates a value exchange. Our hope it that it drives trial and then loyalty. We want to give them something and in turn we hope to get loyalty.
Jeff: Consumer Relationship Management. It’s that arc of technology, strategy and process. Being focused on the customer and out of that you serve your company and goals.
John: Why trench warfare? The machine gun created trench warfare. It changed the whole way of warfare; it’s about containing the movement of the enemy and narrowly defining the way that you do engagement. Does that work with relationship marketing?
Jeff: It might work internally but not customer facing. He doesn’t like pointing machine guns at the customers. [Greatest. Mental Image. Ever. - Lisa] Each has their own entrenched needs, entrenched technologies. It’s about creating collaborative environments instead of fighting with each other.
Andy: They believe in the 80/20 rule. They want to find those people that are worth 5 or 6 times more than the people on the street.
Ben: Who are we really fighting? Is it marketing colleagues? Is it the consumer? Do they really want to engage with brands? Is it finances? It could potentially be a number of people but mostly he thinks that it’s like rolling out new technology to an army that does what it does very well and now they have to change. It’s not really between the brand and the consumer as much as it is the person pushing CRM and the organization.
John: Is it technology? Can you do CRM without the tools?
Andy: Not fundamentally. That plays a part but that’s not CRM in and of itself. You definitely don’t need a technology. You use the right tool for the right objective. We made mistakes with that and over bought tools that we ended up not needing
Jeff: It’s not. You can get started without it. At its essence, relationship marketing is about being customer-centric. It’s about learning the customer’s needs and serving those in the best way. He tells a story about a bad experience with Wal-mart on Sunday but how the way they handled it and have managed the process have turned it into a better experience.
Ben: It’s a cultural change more than anything. My insurance company sends me personalized emails. You don’t have to be backed by multi-million dollar systems. It’s about the mindset. You can start by changing the mindset.
Jeff: Has anyone seen the reverse, where the tool drove the technology? [Zero] How many think it started with philosophy? [More than zero]
Ben: Sometimes it’s available and that’s like a gift.
Audience comment: Sometimes the philosophy isn’t present and a tool gives focus.
Audience comment: Technology can tell you what your philosophy is by what sort of tool you’re choosing. It’s not creating the philosophy; it’s reflecting something you haven’t defined.
Ben: There’s a difference between strategy and tactics.
John: Do people really care about those things that are low level? Do they love their Pantene that much? [Those with pretty hair do. - Lisa]
Andy: They really do. Olay for example is a really huge consumer base that really gives value. There’s a relationship exchange. With less sexy brands like Febreeze or Mr. Clean, they don’t do their own relationship building but things like ‘how do I make my life more simple’? We build programs around the ways that people are using the products, not the products themselves. You have to be more creative.
Ben: People form relationships with the product and the brand (on a higher price point). Not always and not everyone but it happens. The challenge is identifying the people who want to have a relationship. His wife for example doesn’t want to have a relationship with her cell phone but his nephew really does.
Jeff: The way I look at it is that we’re the connective tissue for a good CRM program. Subscribers control the engagement and we have to respect that. They will self-select. We all have an inbox (or two or three or four) and that’s very personal to us. But if you get permission, the ROI goes way up. Text is not email, not a permanent opt in.
Considering the 80/20 rule and looking at the Wal-Mart example, you’re not a frequent customer but making it better for you cost money. So how do you differentiate between the 80 and 20?
Jeff: It’s about recognizing that “Happy Customer’s Tell three friends, Angry customers tell 300″. He gives an example about how Dunkin Donuts implemented a loyalty card and how the cream will rise to the top.
Now I’m hungry. Mmm, donuts.
Andy: The best tactic is to try to be proactive. Try to understand your consumers, and bring them in. 5 years ago it was about scale, scale, scale and so they were doing big sweepstakes. But that didn’t get relevant databases. So now they’re trying to get more targeted databases by creating incentives and tools. Context counts, numbers in and of themselves aren’t valuable.
Ben: Look at broadening the definition of success. 20 percent might be driving the products but a different 20 might be interested in giving you feedback. We leave room for hand raising, for people who are likely to respond to get a chance to respond.
[More specific examples are discussed, I'm going to finish this up and head out for the day. See you tomorrow, folks!]