Consumer Intelligence

I received a letter this morning from an accounting company marked “Private and Confidential”

Feeling all excitable I decided to open it.  You never know with accountants.  It could be a long lost relative deciding to leave money to me in their will.

It wasn’t it was an offer to do payroll for our company.  That’s an interesting service, agreed, not one I need to buy.

But why is it Private and Confidential.  In order for it to be private it must be something that is for my eyes only, something that is personal to me.  For it to be confidential it must be something that if anyone else was to read it then I may be in deep trouble.  For it to be both basically means, if anyone touches this, other than me, they will be shot.

This letter was so non-private and non-confidential that the sender didn’t even bother to sign it themselves, it was a digital signature.

Shame on them.

This is a reckless abuse of the post and of an address on an envelope and I have had enough of it.  I intend to use this blog to post the names and web site addresses of any company that sends me a Private and Confidential letter when it isn’t.  That way you can harass them directly.

So let me just retrieve this letter from the bin.  Oh yes, here it is Bishop Fleming Chartered Accountants, based out of Torquay.   torquay@bishopfleming.com is there email address.  I publish this here, because it will certainly be harvested and then spammed heavily.  Just like they did to me.

A few months ago, a magazine approached me from the insurance industry to do a mystery-shopping piece about insurance companies. For those new to this back page, or who haven’t followed the Ian Hughes story, my company is a mystery shopping company, which sort of focuses on that market. So the offer was interesting for us.

We worked hard on it for about 3 weeks to collect the data and turn it into an interesting article of about 1,000 words. Having submitted it on time, things went quiet. After a few days I wrote to the magazine to see what they thought. They wrote back saying that they really wanted to name and shame the bad companies, they weren’t interested in celebrating what was good in the good companies.

For me that causes a problem, a public naming and shaming is a bit like bring one of those paparazzo’s that follows stars around. I’d rather be a Hello magazine sort of mystery shopper, it just feels classier.

So I said no and the article was spiked.

You have got to hate sub-editors, with this esteemed magazine as the obvious exception. Clearly this is the Hello of Direct Marketing magazines.

I found this annoying, so I thought I would write to the editor. The best way to find the editor, go to the web site and look under contacts, Right? Well, when I went to the site, it gave me an error message when I called up contacts.

Being devious, I thought I would go in through the subscription route. After all, the whole point of publishing a magazine is to get people to subscribe. Isn’t it? Well, I clicked on the subscribe button and…error message.

Bottom line, you can’t buy from this company, and they don’t like to make it easy to talk to them

Imagine that, having a web site where you can’t subscribe and you can’t contact them to tell them you can’t subscribe

You know that they look at the web site regularly, because they will want to make sure that everything looks right in the work they have written. None of them have tried to subscribe or contact themselves via the site, though. Naturally, they will look at the subscriber stats and say “well no subscriptions from the site this week, that’s because no one ever subscribes from that site.” Little do they know the reason why?

The story doesn’t end there. 4 times over 6 months I wrote to them to tell them what was wrong. And the site is still broken.

What you have just witnessed first hand is not something terribly complicated. It is a simple piece of mystery shopping. In mystery shopping terms it is a Lowry. Simple and uncomplicated.

But when was the last time you mystery shopper yourself? When was the last time you checked out your own web site, actually bought something from yourself or tried your customer service? Or have you tried calling your company and seen how friendly the greeting is? Seriously, next time you call your office think toy yourself “would that be OK if I was a customer?

When you have a complicated system and process it is easy for things to fall over, it’s easy for mistakes to happen. But these sorts of mistakes are unforgivable.

It’s bad for a little back street Insurance Industry Magazine. But it can happen to the best of us. While writing this article I was considering whether I should go to DMDNY in New York. So I went to the DMDNY web site and clicked on exhibitors to see if I knew any of the exhibitors going. Then I thought I would check the agenda. A broken link.

Arrgghh….

We should know better, we could know better, but without good testing and good mystery shopping we won’t know. Another way to do it is to look at the error messages thrown up by your web site, but who has the time for that.

In the wonderful world of marketing, we often spend so much time thinking about and worrying about the look and feel of something that we completely, totally, utterly forget the execution. And the very people who should really care about it seem to be blinded to it. In Insurance Times doesn’t sell subscriptions then the sub-editor is out of a job. But the sub-editor doesn’t take enough pride to make sure the web site it right. Similarly whoever runs the web sites for DMDNY, if the show doesn’t work they will loose their job. Maybe a web site that works is a good place to start.

I can preach this lesson because I have failed at this, badly, so many times in my life that it is crazy. I have built so many web sites that build to dead ends. Where customers end up frustrated and annoyed. It can often happen when you are rushing to get something done and, as a result, you forget the details

In a world full of rich communications, you just expect the web to work. And if I have a choice of buying from you or your competitor, and your web site isn’t working, well guess where I am going!

When was the last time you gave your own web site a good kicking? And your competitors?

Apparently I am being followed.

Somewhere, out there, in the ether, someone is following my twitter feed (you can follow me @ianchughes.

You can also facebook me, I am Ian Hughes (no surprise there).

Oh, and I am on linkedin.

I used to be on bebo and myspace as well, but you can ignore those. I have an MSN account and a Yahoo account and several email addresses that are required for mystery shopping purposes.

You can check my blog out at www.consumerintel.com or here at dmionline.com. you can email me, call me or text me.

In short, I’m on the grid.

So now what?

It seems to me that with all these connections my life is not that much richer and neither is that of those around me. You see I can facebook my daughters (can you use facebook as a verb?), I can twitter with my eldest. Some of my friends are on Facebook, some are on LinkedIn.

But in all of this I am finding little extra value as an individual. And if I can’t find value, well it won’t survive.

A recent survey of twitter found that less than 10% of the users are creating about 90% of the traffic, or content or something like that. Bottom line, most people are inactive. MySpace has even announced that it is laying people off.

IMHO (also know as In My Humble Opinion) there is a lot of communication but not a lot of conversation going on.

And it is this conversation that engages people.

For me, a large amount of facebook and twitter is just that, it’s a lot of people making noise. It’s a bit like someone in the old CB radio days (remember those), randomly pressing the transmit button every now and then and saying “I’m driving along”, “Now, I have stopped”, “now I am driving again”.

It’s the electronic equivalent of saying “look at me!”. Before you know it, people will be writing columns for magazines. God forbid!

But where is the value for you as a marketer. There are some great examples of marketers that are using Twitter, like Jet Blue and iPhone. And my good friend Aleksandr Orlov is on Facebook with nearly 500,000 fans.

But the question is, does it make me want to buy car insurance, an iphone or fly jet blue. And the answer is….no.

So what’s the point?

We have tried doing some advertising on Facebook and, I have to say, it worked to a limited degree. But is that because Facebook is a good place to advertise, or because we happened to be one of the first. Will it really work long term?

Let me give you one example of where social networking does seem to be working. On LinkedIn I have a group of people who went to Harvard with me, we are spread across the 6 continents of the world living disparate lives. LinkedIn gives us the ability to reconnect our community. As a result of linked in we are organizing a physical reunion, in order to match the virtual reunion. And this does seem to be working, and it is very simple.

However, recently we had a recruiter try to join our group in order to try and offer members of the group a job. Needless to say we declined. But what would be something that we as a group would be willing to accept? And could the company make money out of it?

Folks, I don’t know. I am not sure what the value of blogging is, or the value of being connected. But here’s what I am planning to do. Over the next month or so, I am going to try my best to get and stay connected. I am going to try to immerse myself in this new digital.

I am going to try and become as connected as a man can be and see what I think some of the angles are. And then I will report back.

Right now, I enter this with a preconception that says this: the only company that has successfully managed to make money out of mining the interests of consumers is Google. Every other company that has worked to build a community of content, which it gives away for free in the prospect of making money from other sources, has failed.

It fails because people get bored or because they object when companies overtly try to monetize the relationship then all this fuss and nonsense is all fuss and no fizz.

It’s been a few months now since you’ve had a half decent book review from me, although some would question whether there has ever been a decent one ever. So I thought I better catch up on my reading.

And who better to read than Jack Trout and his most recent book, In Search of the Obvious. I picked it up while waiting to travel back from my recent visit to the IDI conference organised by the marvelous DMI crew in New York recently. For those of you who didn’t attend, it was a fascinating day. For me a good conference should always have a little bit of stuff that makes you go “hmmm…I never thought of that” and a little bit of something that makes you go “you have to be kidding.” IDI had all of that.

But, rather stupidly on the flight back, I checked in my copy of Inside Steve’s Brian, the story of Steve Job’s and his rise, fall and rise again. We will leave that for another day. Instead I rushed into Borders before getting on my plane in search of something, anything, to keep me amused. And in my usual way I saw this book in a prominent, eye level position in the business section and picked it up.

I have read some of his other books before and his 22 Immutable Laws of Marketing sits half read on a shelf in my office. Fortunately, having read this book I think I can pretty much say I don’t need to finish that or read any of his other stuff.

Let me do the review bit first. If you don’t like book reviews you can skip the next paragraph, then I will do some thinking you can take to the bank based on the book.

So to me, the book felt like a combination of new and interesting takes on some old ideas. In order to get to that stuff you have to read a lot of regurgitation of these ideas (cheap copy to write because you just copy the stuff you wrote before and paste it again, then sell it as new) and some clear swipes at campaigns and companies that he doesn’t approve of (or pitches he didn’t win?). It’s a great book, but you have to bare with it, in the same way as you bare with my rambling in these articles. Did I mention how cheap it is to regurgitate copy because you just have to copy the stuff you write before? Oh, I did. On a side note I should say that whoever edited the book should have been shot. But that doesn’t make it a bad book.

OK, so this is the bit you can take to the bank, courtesy of Mr Trout. Fundamentally, what the book is about is simplicity in Marketing. What Jack Trout says is that bored marketers spend too much time and energy trying to justify their position to Boards that really only care about this quarters numbers. As a result they tinker.

Trout points to the proliferation of Coke Brands, Mercedes Benz Vehicle ranges and GM’s demise as examples of fidgety marketing departments.

The thesis is to keep things simple. If you are the Real Thing then keep it real. If you are the Ultimate Driving machine, don’t play with it. If Safety is what you do in cars (Volvo), then why create a sports car or a convertible. It all about as relevant as a Manbag.

In between these pages there is some genius stuff that some of the speakers at IDI could really have used. Often, as marketers we spend time trying to think of new and complicated ways to get our message over when, actually what we should be doing it trying to find simple ways to get simple messages over. Twitter, facebook and WOMM are all clever, but getting overly clever about those campaigns will not help a company succeed.

If you are a Newsweek or an HBR or a Nikkei, all of whom presented at IDI, then reading In Search of the Obvious is for you. Sitting in the audience I could not help but believe I was watching the beginning of the end of these organizations. They seem to have forgotten what it is they do and why people subscribe to them. To me it seems obvious and their value proposition also seemed obvious. They own content and great creative writing. If you are HBR, you own some of the most respected comment in the business world; people want to know what you have. You aren’t going to sell more subscriptions by cheapening that brand; you are going to sell them by connecting readers to the content. I subscribed to HBR because it connected me to a body of thinking, not because of the special offer. I stopped subscribing when I stopped reading; I stopped reading because I didn’t connect.

In short, looking for the obvious, the blindingly obvious is not a bad think, it’s a good think. Cutting back to what is simple is not a sign of weakness; it’s a sign of strength. You should dream of being able so simple.

And so do I

(Published in DMI January 2009)

The New Year brings all sorts of strange excitements with it, what will 2009 be like, will we still be in recession this time next year?  Will things be better?

Don’t ask me, I figure if the Bank of England can’t work it out then how the hell am I supposed to! 

The anointment, I mean election of Barack Obama in the US this month brings with it an exciting new time for him and for all of us.  But I often wonder to myself what it must be like to be a New President taking up office. 

It’s difficult enough running a business that employs 50 or so people, but a whole country of 300 million.  We have competitors that we pitch against on price, but they never try to unleash a nuclear arsenal on us.  Nor we on them, we just don’t have the budget for it.

So, knowing that Mr Obama is a regularly reader of this column, because he sends me correspondence either criticising or making suggestions for new topics, I thought “What better time than right now to give him some tips on running the country.”  As you do.

In thinking these principles of life through I have tried to also make this relevant to you, my other reader.  So if you think I have missed any then just drop me a line at the usual location and I will be happy to add them in.

1)   It’s not about data it’s about information

As a President numbers and people with opinions will surround you.  But much of the time it will be almost impossible to get to the truth.  Remember that information is data that is meaningful, relevant, useful, timely and accurate.  Keeping one eye on the big picture and another on the minutia is an essential skill in Direct Marketing and as a President.

2)   Testing is everything

Whether it be Missile Shields, Star Wars defence systems, new Levies in Louisiana or Hurricane procedures in Florida, testing is everything.  Don’t just have one policy, have a number and try each of them.  Over many years people will have grown accustomed to things being done a certain way.  That doesn’t mean to say it’s right.  In fact the longer that the “control policy” has been in place the more chance that a “test pack” might just beat it.  If you don’t test, you don’t know.

3)   If you fail then acknowledge your failure, learn from it and move on

We can’t all get everything right all the time.  Not even you, Mr President.  Mistakes are part of life’s way of teaching us lessons after we leave University.  I make lots of them.  But the worst kind of mistake is the one were you don’t say “Sorry, I made a mistake.”  And you learn from that experience and move on.  Making the same mistake twice is the worst form of mistake; it means you didn’t learn properly from it the first time.  Like Guantanamo Bay.   It’s a mistake, say sorry, close it and move on.

4)   Listen to more than one response

Any company that on listens to one customer’s opinion is mad.  In the same sense as only listening to the views of one group is wrong, whether that group be democrats, Washington Insiders or Americans.  The world is filled with different colours, as are you.  Being able get a sense for each of those colours and make decisions that are best for all, rather than the interests of a few is highly sensible.  So no “Drill Baby, Drill” talk please.

5)   Use as many media as possible

To some extent you did this in your campaign, but the new world order is about engagement and dialogue.  How you include the views of everyone in an open dialogue and discourse is key to getting them to buy in to “Change”.  If a river is flowing towards you it’s much harder to make progress than if you have it at your back.  Using the internet and TV as a means of engaging America is crucial.  As DM’ers we use all the channels at our disposal.  We need to find the most efficient and effective way of getting consumers to act.  No action means, no sales.  No sales means, no business.

6)   By consistent

And lastly the issue the issue of consistency.  As DM’ers we see this all the time.  One message delivered by TV, another through the Letterbox and a third over the Internet.  Different graphical styles, different text, different descriptions.  In other words a communications mess with a confused customer who won’t buy again.  Or vote for you.

In short, being a good President is about having the good sense and skill to be able to sense the mood of the people and communicating with them in order to achieve an action, then monitoring that the action taken is still in line with the mood of the people, so that they will come back for more.

So now we have the troubles of Mr Obama sorted out there is the small issue of this side of the pond.  Prime Minister, would you like to sit on the couch and take a few calming breathes before we deal with your problems.  I need more space for that one.

Hi folks,

Consumer Intelligence has a new blog! the idea being that this is a place for us to let you know stuff.

initially it is populated with articles that have been written by Ian Hughes, over the last couple of years. But in the future we are planning more.

enjoy

Ian

(Published in DMI, December 2008)

Folks, it isn’t fun out there, business is hard to come by, consumers pockets have been picked by the credit crunch and they aren’t happy.

In fact Christmas 2009 is not going to be that happy.  But if you want to make it less miserable then read on.

Last year there were enormous problems with people not delivering packages in time for Christmas, and this year, I predict the problem will get worse and will directly contribute to the downfall of a number of companies.  I want to you to avoid being one of them.

Here’s the basis for my thesis.  Things are getting tight (did you notice), so people will take on fewer seasonal workers this year in a bid to save costs.  They will take as many orders as they can and book the sales as quickly as they can in a bid to get cash flowing.  More consumers will go online this Christmas because going to the Mall is just going to depress them and remind them of a time when they had money.  On-line they can save money on the things they need to buy.

So I predict a bumper Christmas this year.

And that’s where the problem starts.  I also predict there are going to be more customer service issues this year than ever before.  In fact it has already started.  In the last week we have placed orders worth over £5,000 with 3 suppliers and then had to cancel them because the suppliers were unable to deliver the goods.  In each case the items were there on the shelf, it was just that their whizzy computer systems could not process the orders for one reason or another.  In all 3 cases a small “exception” occurred and the result was an unhappy customer and a lost sale.

But, actually, that’s not really the problem here.  The problem is that in the process of chasing down the issues with each supplier we have needed to make a series of emails to them.  Followed by at least one call.  The result was that the order was cancelled.

Not only did they end up not getting the sale (having paid for all the advertising and servicing costs of the order up front), they also had the customer service issues of dealing with Mr Angry at the back end.  A lost opportunity AND a load of cost.  It’s the worst possible case scenario.

In all 3 cases I used my new technique of doing a quick Google search to find the CEO of the company concerned and telling them directly how much I didn’t like their service and why I was cancelling their order.  Oh, and what they could have done to fix it.  In each case the CEO was clueless as to the poor service was.

Folks, if it isn’t tough enough and expensive enough to get an order, it ought to be declared a criminal offence to lose one.  Because it will kill your business.

Let’s say you run out of stock of an item 3 weeks before Christmas and you carry on taking the orders.  A few days after you run out, you will start getting calls from customers asking where their orders are.  You can say “they will be shipped soon”, the customer goes away happy.  A few days later they call back saying “it hasn’t arrived yet”.  Except this time they are in a queue with the people who ordered a couple of days after them and are making their first call.  The problem quickly spirals.  They can’t get through so they cancel their orders, because they think you are going bust.  And guess what? You are.

As someone working in DM, at Christmas you need to pack up your strategy bag, out it in the closet and get down onto the front-line of processing orders.  There is no other place more important for you to be than making sure your customers are happy and your tills are full of their cash.

Take the time to watch the systems and processes in action, live and breathe them.  Don’t become remote from them.  This is the time to watch them at their full tilt.  But more importantly this is a time for rolling your sleeves up and feeling your staff and customer’s pain.

Noticing the servicing issues quickly, or the sales issues, will be crucial.  At this time of the year, every little fault is super-magnified.  Every join is stretched to breaking point and what you ought to be thinking is; how can I stop that happening next year? How can I turn that problem into an opportunity? 

This chance comes but once a year, live it.

(Originally published in DMI)

How are those old VHS video’s doing?  Propping up a shelf, gathering dust?  How about your DVD’s or where is your 33RPM LP’s.  Do you still have them gathering dust in your attic?

And what about your Direct Mail strategy, do you think about if fondly, remembering the good old days. Or have you accidentally picked up DMI, flicked to eh back page and are thinking “Direct Mail? That’s so pre-web it’s pre-posterous”.  Why would anyone care?

The answer is simple.  Because no one cares.

Now this logic is going to feel a little bit twisted.  But let me put something to you.  BetaMax, VHS, DVD, BluRay and other video distribution technologies are a beta test for something else.  A beta test by the way is something that developers roll out before the final product goes live.  The end game is to deliver entertainment on demand to your home, or wherever you are on the move.  The technology of writing large volumes of data onto vinyl was crucial at a time when data transmission speeds were slow, when sending a file the size of this article would take 5-10 minutes.  Nowadays it’s 5-10 seconds.  And that’s slow.  With speed of data increasing all the time, it is already the case that you can have video on demand at home.  And it’s not a matter of months before you will be able to get it on the move.  The key is not the technology but the licensing rights.

But is the same true of post.  Has email replaced the post man?  Was direct mail just a beta test for email.  Well, I put it to you that the answer is no.

My thesis is this:

1)      As the volume of direct mail drops so does the “noise”.  Your mailing is no longer lost among the 4,000,000 other pieces that arrive on the recipients mat at the same time.  Now, it arrives almost by itself, along with the other stuff that I can’t seem to get away from opening.

2)     The cost of emarketing is spiralling up.  Look at the cost of Google Cost Per Click (CPC) bids on keywords like “Car Insurance”.  You can pay £10 or more for each click (and the price is spiralling up).  If you only convert 10% of clicks (you wish you converted that many), you are on a cost per acquisition of £100.00.  I’d like to see any insurance company make those numbers work.  In fact I would put it to you that CPC bidding naturally forces most people out of the market.  You can send a lot of letters for £10.

3)     The amount of “Spam” that I get and the voraciousness of spam filters is growing by the day.  In short, my willingness to pay attention to esolicitiation is falling.  As an aside, it always makes me laugh when the emails from email marketing companies talking about how good email marketing is, end up in my Junk Mail folder.

4)     As more people forget how to do good DM, the benefits to those who can will grow.

5)     Consumers are still open to things being delivered physically to them, it fulfils a sensory need to touch (and smell) something.  What’s more the last time I checked more and more stuff was being delivered direct to homes, as a result of the internet.  You only have to see the Tesco, Sainsbury’s, Waitrose, DHL, Parcelforce, Royal Mail, TNT and myriad of other vans moving along the average city street to realise that the doorstep is still alive and well as a place for people to shop.

So my question to you is this.  How good are you at Direct Mail?  Have you honed your skills of getting the envelope opened?  Have you tested your ability to write good letter copy recently?  When was the last time you checked Direct Mail as a medium for selling or marketing?

(Originally published in DMI)

“New look DMI?” I hear you exclaim, “there’s nothing new this month, the format changed months ago. “

It’s annoying, isn’t it?  And yet some of the world’s top brands do this on a regular basis. During the last month I have received two “un”-welcome letters. 

The first was from BMW, welcoming me to my new BMW and re-assuring me that I had made an excellent choice of car, reiterating the key selling points . The pack included a special card that entitles me to some discounts and other stuff that are part of the privilege of owning a fantastic car.

This is a great idea, except for the fact that I received the letter 6 months after I had taken delivery of the car.  The card is in addition to the card I had already been sent by my local BMW dealer, which also offered me all sorts of privileges.  Like discounts on BMW merchandise.  Whoopee!  It did leave me wondering if I didn’t need this card during the last 6 months then why, oh why would I need it now? 

In fact the entire concept of a welcome pack that arrives 6 months after the purchase of the car I found somewhat insulting.  If BMW really was grateful for me buying one of their cars why didn’t they contact me earlier?

So instead of re-assuring me the pack actually has irritated me, it has reaffirmed brand value it has destroyed it.  If you can’t welcome me properly then don’t welcome me at all.

Around the same time I received a letter from Tesco welcoming me to my new house and offering me a range of incentives to come to my local Tesco and shop.  The pack was clever including a nice map of how to find my local Tesco store.

All of which is fabulous except for two facts.  Firstly, I have only moved half a mile down the road, my nearest Tesco is the same one that I used before and used my Club Card at for years.  The second problem is that I moved exactly a year to the day that the mailing arrived. 

Once again it made me realise that this clever mailing initiative had been ruined by crappy data.  Had the mailing arrived within a few days or weeks of me moving, it would have been good.  But a year later?  Please, that’s an insult.

One of my favourite phrases is that for a piece of data to become information it must be meaningful, relevant, useful, timely and accurate.  Each of these mailings fails with most of these criteria.  As a result, something well meaning has become “junk”.  Let’s face it junk mail is a mailing that is not meaningful, relevant, useful, timely and accurate for the recipient.  It’s not about you, it’s about the recipient. 

Nobody is debating that these initiatives is clever and, in some circumstances would be timely and useful.  But this use of data is sloppy and as such the actual result has been negative, not positive.  In fact it’s worse than junk mail, because that just goes in the bin or gets deleted from my in box.  In this case the reaction they generated from me was negative.  They actually devalued the brand in my eyes, because I realised that they don’t really want to welcome me, they just want to push another piece of plastic on me and encourage me to spend more with them. 

It’s not about me, it’s about them.  Well actually it is about me a bit, because they want my money and that’s about it.

You know that the people behind these programs are filled with good intentions and that they will be shocked and horrified to see how badly off the rails their programmes have gone.  Probably they have been running for ages and the result is that they have been chipped away at.  You can almost here the brainstorming meeting being had to work out how to reduce the cost of the programme Suggestions like “Rather than doing daily despatched or data gatherings, it costs slightly less to do it monthly”.  Then someone else pipes up;  “or maybe quarterly, that’ll be ok?”

 But the net result of this chipping away at the programme is that the entire value goes from positive to negative.

So here’s a simple rule.  Next time you create a customer programme, make sure it will be meaningful, relevant useful, timely and accurate FOR THE CUSTOMER.  That means you have to know your customer.  Use this as a way to evaluate whether your decisions are good or bad.  When you make a choice be aware of the impact that it will have in all 5 dimensions.

By the way, I didn’t buy one BMW, I bought two.  I wonder when the next “welcome” pack will arrive?  If ever.

(Originally published in DMI, Dec 2008)

Let’s start 2007 by turning over a new leaf.  Let’s finally decide that CRM systems are actually BAD for Customer Relationships.

Yes folks, it’s sad but true.  CRM is one of the great money spinners of the last decade, $1billions have been spent to try and bring companies much closer to their customers.  Wonderful plans have been given, pitches made and software juggernauts have been parked across the driveways of big companies, stopping employees from getting on with the job of satisfying customers.

During a recent debate in the office we were reviewing some consumer research that says consumers are increasingly frustrated by call centres.  They think that call centre staff are useless, that they are unhelpful and negative.

Last time I checked, no one that I know said that the best bit about getting up and going to work in the morning was the prospect of making customer’s lives a misery.  Those working in the call centre have to spend much of their life dealing with “characters” on the phone.  And those characters are getting even more colourful.  Why?  Well in a lot of cases most of the simple stuff “I would like to make a straight forward purchase please” or “Can you give me an address I can return goods to please?” or “I would like to cancel my reservation please” has been dealt with by the internet.  We can do the simple things on-line.

So what does that leave for the poor, unsuspecting agent?  Well, the sort of crud that can’t be dealt with on-line.  And if the on-line system can’t handle it, then there is virtually NO chance that the CRM system is going to be able to handle it.  All the agent really has is ears and a better knowledge of where to go to for the answer (maybe).

A CRM system is of no help at all.  And CRM doesn’t seem to be used for the more exotic things either.  Like when I renewed my car recently my car leasing company didn’t even bother to write to me and say “your lease is coming up for renewal, why don’t you buy a new car?”  Why not, well it’s not because they are a small company with no system.  No they are a big company with lots of IT people and a big system.  A system so big that it doesn’t track small things; like customers about to walk away from you.

I genuinely believe that at the heart of the CRM problem is that technology has got in the way of the customer Relationship.  Software companies have seen the possibilities of lots of software, hardware and support and they have said “yea, we’d like some of that”.  But because they were IT companies they tried to deal with Customer Relationships in a very IT way, by putting things into nice boxes.

The problem with this world in which we live in is that I am not a segment or a demographic or an Acorn number or any of that stuff.  I am me and I do stuff for weird reasons.  Most of which are similar to other people’s reasons, but some of them are just bizarre. 

CRM needs to start and end with the customer.  Along the way a computer might get involved, but when you start and end with a system.  Well, what you end up with is a straight jacket.  The result? Irritated customers, irritated staff and irritated management.  Of and a lot of money wasted.

SkyTV in the UK  are in the process of mulling a £700m law suit as a result of a screwed up CRM implementation.  Even though the original contract was only worth £40m.  Perhaps this is indicative of the kind of issues that you get in to when CRM goes wrong.

At the heart of this issue is the customer.  So why don’t customer relationship management systems work?  Well, they often fall down when they encounter humans.  The humans are too lazy or too time pressured to be able to keep things up to date OR humans that just can’t quickly get to the bit of the system that they need to, to get to the facts they need.

If a CRM system is all about classifying and processing customers then customers are going to end up feeling classified and processed.  Instead of answering their questions and comments they are going to be dealt with, in the most expedient way.  Instead of being hugged and made to feel important they are going to feel like they are being sold some other useless thing they didn’t want.

At the end of the day CRM is about the customer relationship.  It starts and ends with the customers.  And here’s the surprise, we are all customers.  Would you treat yourself the way your CRM system treats you?