Customer Relationship Management

The Idea

Basically, the idea is to have an Ultimate Customer Master which is maintained by an aggregator - like Google or Facebook, for instance - where individual customers can update personal details on a going basis. And companies can subscribe data from this system either on a going or an ad-hoc basis.

Individuals can start with the demographics like name, date of birth, gender, qualification, marital status, etc.  While basic details like first name, date of birth and gender can be assumed to be non-changing (with exceptions, of course), details like qualification, income, job details, address, marital status, details about family, etc. keep changing and the individuals can keep updating them. Gradually, the scope of information collected can be enhanced to include:

• Interests and hobbies:  Rather than doing a one time capture of hobbies and interests, it could be an ongoing capture of information on hobbies like, for instance, information on places travelled to, books read recently, movies watched recently, etc.
• Behavioral and Attitudinal data: Here again, it could be through surveys administered to the participating individuals periodically, rather than through one time collection of data at the time of account set up.
• Big ticket purchases: Ongoing tracking of purchase of big ticket items like a car, flat screen television, appliances, RTVs, etc.
• Brands used: Individuals can start with the list of brands they use for the items in their regular purchase basket and keep updating on a going basis.
• Establishments visited: It could be places of worship, gas stations, grocery stores, salons, libraries, eateries, etc.
• Etc.

Companies can subscribe to this Ultimate Customer Master. Based on an ID supplied by the aggregator the individual provides at the time of setting up an account, they should be able to request data for that specific individual from the system.  There could be several modules that they can subscribe to. It could be basic demographics (which would include very basic details like Address & Contact Details), Extended Demographics (which would include other demographic details), Psychographics, etc. They should be able to get this data for a specific customer at a given point in time or as periodical updates for all the applicable customers.

The Business Model

To my mind, the one single thing that will determine the success of this is the currency of customer data.  Obviously, the wider the breadth data collected and the deeper the level of details, more valuable and, of course, saleable, the data is going to be. However, the system will continue to add value only as long as the customer information remains up to date.

There is a couple of different core revenue models to consider for this:

• The aggregator could charge companies on a one-time basis for purchase of this data for a given customer and also an ongoing fee for updates.
• Also, the charges could be different for different modules like basic demographics, extended demographics, psychographics, etc.
• And the aggregator could sell campaign lists
• Given the scope of data collected, there is an opportunity to sell research on customer data as well.

I can think of a couple of ways the cost model can be addressed. The individual customers entering this data on a going basis are the ‘suppliers’ for this model and need to be treated as such. They could be rewarded in a couple of ways:

• The compensation to the individuals could be based on the quantity of data entered. It could be based on
• the width of information entered in terms of updates to different modules
• the depth in terms of providing updates to various data collection questions or options for each of the modules
• the frequency of updates
• It could also be based on their membership in the lists sold. For instance, if an individual happens to be a part of a campaign list sold to someone, he can potentially be compensated.
• A part of the individuals’ compensation can come from the research revenue as well. However, it may be difficult to assign the right source for a given research output

The Challenges

While the approach seems to be pretty simple and straight forward, a couple of challenges comes to mind:

• While the options proposed in the cost model look simple enough, some of them may be very challenging to implement. While it would be one challenge to come up with the models for compensation, it will be a totally different challenge to make the customers understand how they are getting rewarded.
• Needless to say, the sheer mass of data that is collected would be a challenge to handle in itself. However, we are already making a lot of progress when it comes to handling large data volumes. Indexing of web pages and handling them in real time by search engines is a good example.
• It is difficult not to think of Privacy Concerns when it comes to selling Individual’s personal data. However, in this case, given that the base data is ‘sold’ by the individuals, there is consent to sell.  However, the individual should have the ability to opt out of the program as desired.

The scope for expansion

The potential for expansion of this system is unlimited. Imagine the following couple of possibilities:

• How would it be for the aggregator to partner with third parties like for instance for banks / credit card companies and major retailers to get items in the purchase basket?  If the individuals can provide their credit card information, they could be used as a key to purchase credit card transaction data from banks.
• It need not be just businesses who would be consumers of this data. It could be even government agencies, Collection agents, etc.

While the need for this always existed, I believe that time is now ripe for implementation of the Ultimate Customer Master. Such a system would have been difficult, if not impossible, to implement till sometime back purely due to transactional costs. Essentially, we would have required a middleman to collect and input data into a master – the cost of doing that would have more than potentially surpassed the benefits. With internet available to most of the folks, it is like checking emails (or even visiting your social networking site like Facebook, for instance). And, more importantly, with the individuals’ willingness to share everything personal (in social networking sites, for instance) being high, it seems to be a matter of just riding on the wave.