Customer Relationship Management

In Facing Re-Implementation vs. Upgrade dilemma for your CRM systems?, I tried to set the context on the typical dilemma an enterprise is confronted with when it has to choose between Upgrading vs. Re-Implementing it’s CRM Application and I have taken Siebel as the CRM package for elucidating my thoughts on the same.

Some of the key criterions, to be considered by an enterprise, which can help and influence the decision on whether to upgrade or re-implement the existing Siebel CRM applications include:

• Technical Upgrade Path:
In order to assess the complexity involved in upgrading to the latest product version, it is important to understand the version of the Siebel Application that is currently in use as that would determine the technical upgrade path to be taken.

Siebel 2000/6.x to 8.x:
Upgrading Siebel Application from an older version like 6.x to 8.x is a two step process i.e. upgrade from 6.x to 7.7 and then from 7.7 to 8.x. This can be a tedious process with significant changes to the User Interface, navigation, application configuration mechanisms, enriched functional capabilities, improved & flexible integration mechanisms, modified data model (party model in 7.x) etc. Re-Implementation can offer the flexibility to leverage the out-of-the-box User Interface layout, application configuration capabilities and out-of-the-box functional processes right from the start of the implementation. However, a significant data migration activity will have to be considered in order to design and migrate the data from the older version to the latest version. In most of these cases, the corresponding databases might also need to be upgraded to meet the system specifications and compatibility requirements with the latest version of the Siebel Application.

Siebel 7.x to 8.x:
Upgrading the Siebel Application from version 7.x to 8.x is a straight forward and single step process unlike upgrading from Siebel 6.x. Similarities to a considerable extent, in the application navigation, configuration mechanisms, and party data model philosophy help the upgrade and post upgrade processes easy to manage and execute. Siebel Upgrade can be a good choice in such a scenario. However, extent of existing customization and the additional functional capabilities to be built can swing the decision between upgrade and re-implementation approaches.

• Extent of Existing Customization:
As mentioned in the previous criteria, extent of customization in the existing version of the Siebel Application is very critical to assess the scope and effort required to leverage the out-of-the-box configuration capabilities from the latest version to be upgraded. Upgrade will result in migration of the existing configuration and customization to the newly upgraded instance. However, diligent feasibility analysis will have to be performed to understand the various options available to leverage the out-of-the-box configuration mechanisms and reduce the migrated customization to the extent possible. This can be a tedious process to accomplish if the existing instance is heavily customized. Lack of adequate documentation (which is the case usually ) can turn the entire de-customization process into a nightmare as the impact of this exercise on the existing functionality might not be assessed precisely.  If the extent of customization is simple-to-medium, then an upgrade option can be considered suitable. However, a heavily customized instance is not a very good candidate for upgrade and a Re-Implementation approach can be a better option.

• Cost of Upgrade / Re-Implementation & ROI:
The cost of upgrade versus the cost of re-implementation depends on various factors such as the version of the existing Siebel instance, complexity of existing customization, data volumes involved, extent of new capability that needs to be built, timelines involved etc. Though a technical upgrade can migrate the configuration and customization changes, it might need an additional diligent effort to modify the user interface layout, leverage out-of-the-box configuration capabilities to reduce customization and handle deprecated scripting methods etc. to make the upgraded instance functional and user ready. Upgrade offers great benefit in migrating the data, the configuration and the customization changes easily as compared to a re-implementation exercise where in the data needs to be migrated as a separate task and the configuration and customization changes built from the scratch. This will have impact on the timelines and the corresponding costs. Cost of upgrade can be less than the cost of re-implementation in cases where the complexity of customization is low and the version from which the upgrade is done is smooth such as Siebel 7.x and above.

• Risks Involved:
Each approach has related risks associated with them. An upgrade approach resulting in substantial de-customization effort might result in some functionality missing through the cracks, if the impact of the changes on the existing functionality is not assessed well. While in the re-implementation approach, non-availability of well documented business processes and requirements for the existing (old) functionality might result in some functionality missing through the design and build phases only to be caught during the validation phase of the program or sometimes even later !!!

There could be some more aspects to take into consideration to decide upon this dilemma, but I tried to share the ones that I felt are primary. Pls feel free to add in your thoughts as well to this.

In conclusion, there is no single pill solution to this dilemma and has to be considered holistically taking the above described criteria into consideration and fitting the same to each enterprise in conjunction with the enterprise’ risk appetite, future roadmap etc.

Posted by Ramkumar JHS at 10:36 AM | Permalink | Comments (1) | TrackBacks (0)

The success of a CRM implementation lies in its acceptance for use by the various stakeholders. The stakeholders vary depending on the industry and application in question. Some of the stakeholders commonly involved in CRM are top management, marketing managers, retail sales agents / call center agents / field sales agents, customers using self care applications, dealers and product managers. Each stakeholder has their own set of expectations from the CRM system. Based on my experience in working with some of these stakeholders, I have listed below some of their expectations:

Top Management:
1.   Enhanced customer experience leading to improved top-line.
2.   Reduced Total Cost of Operations resulting in improved bottom-line.
3.   Improved business reporting leading to better governance.
4.   Company branding through Improved Customer Service and diverse innovative product portfolio.

Marketing Managers:
1.   Correct customer segmentation based on various parameters.
2.   Effective tracking of marketing budgets.
3.   Effective Campaign Management.
4.   Effective closed loop marketing.
5.   Use of appropriate treatment for marketing campaigns based on customer segments, to reduce marketing expenses.
6.   Event planning.
7.   Remote application usage (synchronization between laptop and PDA’s).
8.   Performance monitoring for dealers.

Retail Store Agents / Call Center Agents / Field Sales Agents:
1.   Ease of navigation.
2.   High speed.
3.   Availability of 360 degree view of the customer.
4.   Easy context sensitive help features.
5.   Mistake proofing.
6.   Validations to prevent duplication of data (e.g. customers, products etc).
7.   Pop-up messages for warnings, disclaimers etc.
8.   Profiling as per area of work (display only “need to know” information).
9.   Display prioritized list of activities.
10. Pre-intimation / training of new features / messages from time to time.
11. Pre-intimation of scheduled maintenance activities.
12. Faster, accurate calculation and disbursement of incentives.
13. Reduced work with other applications / manual paperwork activities / SSO.
14. Increased level of integration with other systems to offer seamless customer service.

Customers using the Self Care channel:
1.   Ease of navigation.
2.   Facility to search products and services easily.
3.   Facility to chat with an agent in case of any product/service related queries.
4.   Facility to see all the charges (fixed, recurring, usage related) associated with the product / service.
5.   Display of “Hot Offers”.
6.   Ease in bundling products and services.
7.   Up-sell and cross-sell of products and services.
8.   Minimal screen refreshes.
9.   High speed.
10. Guided user help.
11. Mistake proofing.
12. Order / fault acknowledgement.
13. Frequent status updates (on site / through SMS / through email etc).
14. Facility to update/cancel already raised orders/faults.
15. Facility to make online payments, view bills, view usage pattern etc.
16. Automatic accrual and quick redemption of loyalty points.

Product Managers:
1.  Reduced time to market.
2.  Facility to bundle / un-bundle products and services easily.
3.  Introduction of ‘availability / compatibility’ and other rules for the products quickly without help from technical support.
4.  Facility to provide comparison of products (with in-house products / competitors’ products).
5.  Facility to attach user manuals, collaterals etc to products that will help in increasing the sale of the product.
6.  Facility to quickly introduce / modify / withdraw products without technical involvement.

Dealers / Partners:
1.  Self care functionality.
2.  Sharing of opportunities to and from the company.
3.  Joint marketing with the company.
4.  Accurate calculation and speedy disbursement of incentives and compensations.
5.  Automatic accrual and quick redemption of loyalty points.

Neglecting these expectations while selecting / designing the CRM system may cause several implicit or explicit change management issues. Explicit issues could be in the form of resistance to adopt the new CRM system by agents, dealers etc. Implicit issues could be customers preferring email, call center as the communication channels instead of the self service channel, leading to increased cost of operations. Thus, management of these stakeholder expectations is one of the most important factors deciding go/no-go decisions for the CRM Application.

Posted by Suhas Kanade at 11:00 AM | Permalink | Comments (0) | TrackBacks (0)

I am sure a lot of us are already aware; few months ago Oracle released Process Integration Packs (PIP) based on Oracle Fusion Application Integration Architecture (AIA) framework. These PIPs establish pre-built integration between applications via AIA layer and are modeled on the SOA best practices. Through this article I have attempted to analyze the key features of the PIPs as well as the challenges that might surface while implementing.

At Infosys, we recently co-partnered with Oracle to develop new PIPs. These PIPs were based on two existing PIPs:
• OCH (Customer Hub) PIP - Establishes SOA based integration between Oracle Siebel UCM, Oracle eBusiness Suite and Siebel CRM
• O2C (Order to Cash) PIP - Establishes SOA based integration between Oracle eBusiness Suite and Siebel CRM
The gist was to reuse the components from the existing PIP and develop new PIPs to establish integration between:
1. Oracle Siebel CRM and SAP: For Order to Cash Flow sync
2. Oracle Siebel UCM and SAP: For Customer Master Data sync

The PIPs indeed offer rapid integration between packaged applications. It almost completely takes away the complexity and rigor involved in establishing real time sync via middleware (Oracle Fusion / AIA is prerequisite). Sculpted on SOA best practices, there is minimal change needed at the applications (eBS, Siebel, SAP..), the middleware platform establishes the data mapping, cross references and any other transformation needed to ensure diverse applications integrate for the said functionality. The whole PIP concept is still in its nascent stages, but for sure there is a lot of promise and value in the overall integration benefits realized by the clients as well as the system integration vendors.

Having mentioned this, I would also like to iterate few challenges that must be confronted to establish PIP like integration. At client environments where any AIA PIP is being licensed, I have seen general curiosity among client IT to know the grey areas in order to establish PIP like integration of packaged apps like Oracle Siebel UCM, Siebel CRM with other enterprise applications. Would like the mention the following points that must be kept in mind while conceiving such integration – off course, coming from packaged applications background, I have written this from application consultant’s point of view :
Contrary to the general belief, development of a custom PIP – entirely or partly based on any existing PIP, requires a lot more from application teams then merely testing the functional flows after the technical work is done at the AIA layer. There is a lot of collaboration involved between all the teams (application teams, AIA team) to develop packaged integration.

Applications teams must be adequately staffed to tend to the following:
• Functional Leadership - This is unique flavor of the PIP development programs. Although the majority of technical development is done on AIA, the functional leadership is to be provided by the application teams so as to map the functional flows across applications.
• Data Mapping – Due to the differences in Data Model between applications, data mapping is one of the most complex tasks during PIP design. It is important to have experienced data migration experts on both application teams to help facilitate data mapping.
• Out of the box message structure / Web services may not work – Despite the best interests from all the parties, the OOB message structure of the base PIP may not work. This may mean changes to the standard canonical data model and also to the underlying integration architecture – Web Services, Integration objects etc.
• Setting up Cross references, Domain Value maps
• Integration Testing – Seamless integration between apps is the primary objective of the PIP, utmost importance is to be given to the entire testing mechanism. Integration test cases should be carefully drafted so as to mention the steps to be executed at each layer (participating applications, AIA) for each scenario. During test case execution, a lot of collaboration is needed to check the hand-shake across layers and the appropriate flow of information.

I invite all comments/messages to this blog. PIPs is definitely a new and evolving concept, let us all gain from each others experiences while we implement this new integration mechanism with clients.

Posted by Anshuman Saxena at 09:40 AM | Permalink | Comments (0) | TrackBacks (0)

by Vinod Nag

Stock market investment is always a challenge for anyone, regardless of whether a person is an expert in finance or wants to make an entry into the stock market but does not have any clue about how it works. It is not easy to play a blind game with the market and win. However, to play a wise game, it is important to understand how a company is performing, how are its scrip placed, is it over valued, what is the current market trend, how is this industry sector doing, are there any external influence like change in government rules, market corrections so on and so forth.

There are many ways that health of a stock is calculated before a decision is made to sell or buy. Some of the well known methods are Quality-Price matrix, Management and investor rewards, Economic analysis, Competitive conditions analysis, International trends, Ratio Analysis, Technical signals etc. Apart from these, it becomes primary obligation to check the safety of investment, stable returns, marketability, liquidity and value of capital. Similarly, other instruments like securities, bonds; Equity/Mutual Funds, Insurance, etc. should also be dealt carefully before making any investment or disinvestment.

Further, it is indispensable to think of portfolio management to cautiously monitor and act in time to stay on the profit side and take calculated risks. In a nut shell, one should have ample time, in depth experience and skill to predict the future to be a winner.

Imagine that you have a trading account and have just logged onto to execute a transaction. There you find an advice customized specially for you that meets your interests and requirements, telling you what to do… Wouldn’t that delight you when the advice indicates where to invest, when to buy, when to sell and what quantities? Consider that it always works for you then, there will be no limit for your happiness.

Voila!!! Virtually, people will have profits and lot of profits…

On the enterprise side, many businesses now a days are drifting towards customer experience to improve their business, make more profits and make their brand renowned. Customer experience is another big topic that is discussed much in CRM (Customer Relationship Management) world. It is a proven fact that it is much expensive to on-board a new customer than retaining an existing one. It is also seen that loyal, pleased and customers with long lasting relationship will become brand carriers and influence in getting more business. With the revolution in the software and technology facade, there are many products and solutions available off the shelf that provides enterprises a vehicle to interact with their customers and fulfill their needs. These CRM products mainly focus on sales, service and marketing. There are many channels that an individual uses to interact with their service providers. It could be telephonic, internet, electronic texting, direct mails etc.

Let us think of the business we are discussing here, a business that is engaged in wealth management and stock broking. It would have a portal where its customers execute various types of transactions. This portal can be one of the touch points for companies through which it can delight their customers by providing value added services like “Stock Advices” customized to the need of an individual. With such kind of facility available on a portal, it is for sure people will like to leverage this and be happy to exploit the significance to their advantage. There would be a very good chance for businesses to improve customer experience and attract more business.

Having said all these, a challenge that remains is the reliability of the advice and how confident is a customer of this advice? Has it considered all the future requirements of the customer? Is there a history of the advice which proves itself?

The answer to these questions lies with customer decisioning combined with predictive analytics.

Customer Decisioning is a technique of identifying suitability of a proposition to an individual/customer in focus. Customer Decisioning is widely used for automating business decisions like new account opening for customers, Credit Card issuance approval, Credit limit increase requests, loan requests approval etc. Customer decisioning also includes identifying suitable products/offers for cross-sell and up-sell based on the interest of the customer’s call reason.

Predictive analytics is a statistical method for classifying behavioral patterns found from collections of data. This analytics includes a variety of statistical methods, game theory and data mining techniques that analyze existing and historical data and provide forecast about future.

In business, predictive models leverage behaviors found from historical data to identify opportunities and risks. Models capture relationships amongst factors, commonly called as predictors to allow risk assessment and/or potential risks associated with a particular set of conditions. This in turn will influence decision making for a given customer request. It is also possible to fine tune the prediction or results of these models if external influencing factors are well defined. Predictive model considers many factors like income, age, savings, liabilities, movable and immovable assets, status, future plans and interests from KYC (Know Your Customer) data etc. Output of decisioning models will predict behaviors of a customer and suggests suitable products/services that can be offered.

Similarly, if predictive models are built with appropriate input to present the behavior of various financial instruments (like stocks) or companies will help in identifying next action. Predictive models output can support fund managers to take wise decisions for their bulk investments too.

To satisfy individual customer needs, combining the prediction of customer behavior and best action that can be performed on given scrip or financial instrument, a suitable decision can be framed.  Such decisions can further be made available to individuals customized as to facilitate them take suitable action.

So, can we say that a Predictive Analytics solution is one of the discreet methods of improving customer experience and the prudent means to understand the stock market investment?

About the Author

Vinod anchors the Chordiant Centre of Excellence within the Enterprise Solutions unit, besides being involved in presales. He has managed offshore delivery of projects for major North American banks, achieving high customer satisfaction in these engagements. He has also been active in initiatives for competency development. Vinod will blog on marketing, campaign management, and various aspects of CRM.

Posted by guest at 08:51 AM | Permalink | Comments (7) | TrackBacks (0)

Though CRM is mostly equated with technology and how software applications can be used to increase customer profitability in sales, service and marketing operations, there is no denying the fact that strong personal relationships can far outweigh any competition from super efficient CRM systems and processes.

That is true even more so in today’s world where we expect less and less from corporations which hide behind Interactive Voice Response Systems, Policy Disclaimers and Terms of Agreement and carefully scripted support calls where even the most enthusiastic agent is probably appraised on how quickly he or she can get you off the call (Did you hear the sigh as well when you actually replied ‘yes’ to the question, ‘Is there anything else I can help you with?’).

‘Smart’ organizations know this and they find newer and newer ways to ‘connect’ to their target audience. But pretty soon the ‘new way’ becomes a ‘channel of communication’. Profitability experts land up and start evaluating the returns to the business on every such medium and the pie of marketing communications gets more muddled with every next new thing. And soon enough consumers become numb to the barrage of information thrown at them wherever they look (who was the genius who invented ‘eyeballs’ as a metric?).

Email advertising was the breakthrough in customer connect some time back. Now it has been overshadowed by ‘Spam’. Today, the buzzword is Social Media Marketing. As I write this, people in thousands of conference rooms across the world are probably charting out their ‘Web 2.0 Strategy’ and licking their lips in anticipation of the windfall that is about to be gained by incorporating Facebook and Twitter in their Marketing plans. Differentiation, you know, one of the tenets of great marketing.

All this hoopla to achieve something which probably your neighborhood Mom n’ Pop store achieves without spending a dime. Yes, CRM @ Personal Touch is free! And most of the time, it doesn’t require ‘technology’.

I walked into a hairdressing salon the other day. I was a ‘new customer’ and so they took down my address and other details. I rolled my eyes but I really needed to trim those locks and so acquiesced to the few questions they asked. The ‘experience’ was fine and sure enough there was a letter in the mail in a few weeks from them. Aha! I thought, but here was what caught me completely by surprise.

It was handwritten.

I was flabbergasted. I tried to think of the last time I had received a handwritten marketing communication. All the letters that I could think of, from banks to telecom service providers, from insurance companies to airlines, why, even my own employer had everything including the signature printed and embossed on them. And here was a full letter, wishing me a Happy Thanksgiving and hoping that I was satisfied with the service that I had received written in nice bold strokes that my five grade teacher would have been proud of. I immediately resolved that sometime in the near future I will write about this incident in a blog post titled, ‘CRM @ Personal Touch’. It’s amazing what high levels of customer engagement can achieve.

Maybe they just ran out of printer ink.

When was the last time you were delighted as a customer with CRM @ Personal Touch? Do comment.

Posted by Anand Bharadwaj at 05:30 AM | Permalink | Comments (8) | TrackBacks (0)

We are at a stage, to bid adieu to year 2009. It is now time for us to evaluate the trends in the MDM domain for the year 2010. Ray wang in his blog titled “Master Data Management 2010 - Focus On Outcomes Drives Push For Value” has referred to the need for managing additional data type in MDM.

I concur with Ray and in my opinion, enterprise content management e.g. managing of price list for a product sold through campaigns, may have to be referred to in an MDM product data hub. Similarly for an insurance domain, claims raised against an insurance policy may need to be referred to from an MDM customer data hub.

This effectively means that master data management now have references to those enterprise content that has bearing on his/her interactions with the organization. The management of the lifecycle of these documents may reside in a fully fledged document management system i.e OpenText Live link, IBM FileNet, Xerox Docushare, Oracle Content management. This effectively means that unstructured data has now a relationship with the structured master data elements and this relationship should be clearly available when a 360 degree view of the customer is being evaluated. Decision and insight that needs to be taken for a customer, requires supporting documentation that resides in the document management system.

Business now realizes the benefits of having enterprise content readily available at the finger tips. So for the year 2010, we can be sure more MDM practitioners harping on the need for an integrated MDM solution with an enterprise content management solution.

Posted by Jairaj Asok Kumar at 01:52 PM | Permalink | Comments (0) | TrackBacks (0)

Telecom Regulatory Authorities (TRAs) of different countries have successfully been able to leverage MVNOs (Mobile Virtual Network operators ) to increase competition, decrease costs. This has been positioned as a “win-win-win-win” depending on how you look at it. TRAs achieve their objective of increased penetration & competition, Customers benefit due to price re-alignment, wireless operators with network operators benefit from increased network utilization and MVNOs from new business. The reality is a little different. While the customers benefitted and TRAs achieved their objectives, the other two stakeholders are struggling. But the concept is still dis-ruptive.

MVNOs have positioned themselves through distinct branding and positioning. Many players have entered MVNO and they include large retailers to cable / credit card companies, banks, handset / electronic manufacturers, satellite and international mobile operators. MVNOs have their challenges in-terms of business model, funding, segmentation & branding, partnership & pricing strategy, market strategy and differentiated services. During the start-up phase for a MVNO, management would have enough challenges on their plate than worry about IT aspects around Package selection, operational processes, technology et al. Will a Business Support systems cloud aka pre-integrated CRM, Billing on a cloud help these MVNOs ? Will it help them concentrate on their pre-launch challenges and at the same-time optimize their cash out-flow? Or will it be a damp squid..or squib?

Posted by Ranjit Jagirdar at 01:43 PM | Permalink | Comments (1) | TrackBacks (0)

Having worked on CRM system implementations for quite some time, I have been listening to one common statement from business / product managers - I am not satisfied with the CRM system that is being deployed/was recently deployed. It is a common complaint across the spectrum, right from small businesses to the larger enterprises. Why this does happen again and again, that too across the world? Is it that technology cannot meet business requirements and expectations all the time? In this post I would like to discuss one of my observations and find some ways to address this issue.

It is very common to see an organically growing company starting off their CRM in Microsoft Excel sheets, and then using Visual Basic macros and in-built functions. They then think about starting with client-server based home-grown software tools with small database technologies similar to MS-Access. The company grows steadily, and then comes the complexity with millions of customers and business expansion strategies like acquisitions and mergers, forcing the companies to buy COTS products for CRM.

The Issue

By this time the processes, functionalities and technologies followed in the regular business is not supported in any COTS package and people may not be ready to accept big changes! Does it mean that the technology cannot support business? When the promoters foresee how the business is going to be in a few years they should also foresee and plan the vital three - people, process and technology.

People: This includes customers, employees, partners, investors - basically all the parties who show interest in the company with different perspectives. With the latest technology trends, everyone interacts with the company, accessing information/data using technology.

Processes: Every company/individual has their own strategy when it comes to addressing the needs of customers, marketing tactics and other ideas. It is hard to expect that the processes would be same for two competitors selling/serving same products. Can the COTS CRM products available in the market accommodate these variations?

Technology: As it evolves, it influences the above two factors, bringing the changes in people and processes. Technology influences the market with new and innovative products and services, and also the delivery and assurance of these products and services.

To me, technology is one of the factors enabling the business strategy along with other factors like people and processes.  All the three need to be planned well in advance, and based on the business strategy and direction.

In the coming posts I will address some more strategy related questions. Do share your views here.

Posted by Raja Sekhar Ravi at 04:30 AM | Permalink | Comments (4) | TrackBacks (0)

What existed before MDM (Master Data Management) term started being used so frequently? CDI? EII? Do they sound familiar? If you take out a part (customer-only) of today’s MDM, it becomes CDI (Customer Data Integration). We have been seeing the trend of Customer Centricity and creating a 360 degree view of customer so that there is always one golden record of customer data across multiple channels of an organization. I think the intent is still the same to improve customer experience and increase cross-sell/up-sell opportunities. But, look at these so called 4th generation Multi-domain MDM products. Aren’t we getting more and more entities/domains in MDM products with every new release?

I have been working with a client for past few years where they intended to start with a pure CDI solution so that they could retire their legacy systems (acquired during various M&A) and have one central hub for customer and it’s relationships records. But at that time (about 10 years back) they ended up getting a CRM solution as there were not many CDI only solutions available. While the intention was to create a customer hub and they started with Customer, Account and Location but could not resist to utilize other available CRM entities and functions (Employee, Referral, Team Management etc.). And guess what, on top of all this, customization were done to build Customer Campaigns, Alerts, Know Your Customer Compliance and Questionnaire, Managed Accounts (Value Packages as are known now) etc. in one application. It became so huge that cost, maintainability, scalability and data quality started becoming huge concerns. So, you can guess the next action…Yes, you got it…Break it again! Have a CDI hub and other miscellaneous entities as federated data domains around that customer hub (having Customer data and it’s product relationships and that’s it).

Now, look at the evolution of “MDM for Customer” (I’ll still call it as CDI) products. The way they started vs. the way they look today. Aren’t we getting all the entities I mentioned above (and more) in the same product? Someone looking for a solution to maintain only Customer and it’s relationship data will end up getting all other entities even if not interested (or not needed). Even if some organization utilize all the entities with huge data and transaction volume in the same application under same product, wouldn’t it become too big to handle? So, is there a need for a pure CDI (low end versions) and a robust MDM (high end solutions) products being available at the same time?

Posted by Sandeep Gandhi at 11:19 PM | Permalink | Comments (0) | TrackBacks (0)

Recently I read an article on “Indian FMCG industry”, the article talks about lavish marketing spends in FMCG. This year marketing spends growth was twice that of the sales growth in Indian FMCG industry. In one way this is good news, Marketing is being given importance but unfortunate thing is that they are running towards a big disaster without measuring ROI on Marketing. Marketing was considered as a function which doesn’t provide any value addition when compared with its sibling sales. It is considered as a cost center.

The primary reason being sales talks about numbers where as marketing talks about indiscrete aspects like brand value, awareness, and so on. Sales team has competition from competitor’s sales team, however for a marketing team; the competition is both internal and external. They have to compete with sales for getting resources as well as with competitor’s marketing divisions. Without proper ROI marketing can never win against sales, as sales show the numbers. Management at CXO level, look more at numbers like sales, revenues, profits, margins than brand value or awareness. That’s the reason during the times of recession or any financial crisis in a company; marketing budgets are the first to get a cut in most of the companies. 

Such spends on marketing without proper ROI will definitely lead to a disaster both for the company as well as the marketing division. The company will incur lot of expense due to extravagant marketing  spends and the plan’s objective might not be achieved due to several reason most important of them being  wrong timing and indifferent customer. Let us assume that most of the marketing spends are on promotion campaigns where discounts are being given, but then the assumption that “customers will buy when discounts are offered need not be correct always”.  For the marketing division such spending without proper returns will lead to loss of trust by senior management and in future whenever there is a conflict between sales and marketing for resources sales will always win. Hence it is more critical for marketing to be more cautious in their spends and more accurate in measuring the marketing ROI.

Coming to where and how to measure the marketing ROI, one area where marketing can talk about numbers is leads, but sales team has a conflict with marketing on the good lead and bad lead or rather not a lead. To an extent it is true that marketing team will pass on all the responses for a marketing event/campaign as a lead to sales team, but how many of them are true leads? Hence there should be a common understanding between marketing and sales for qualifying a lead as good lead. This helps in measuring the campaign ROI more accurately. Marketing divisions should plan in such a way that each penny will result in maximum returns and then measure the ROI to show that marketing spends are driving sales.

Marketing organizations in a company should follow closed loop marketing process for measuring accurate marketing ROI. A closed loop marketing process where sales targets and marketing targets are used for marketing planning, marketing events, programs, campaigns are planned based on marketing plan and the marketing responses are properly segregated and analyzed to arrive at the ROI of the marketing events and finally this data is used for marketing planning in the coming financial year / quarter. Since each action is identified and each response is captured it is accurate and easy to measure the ROI and show the benefits to the management. A good CRM implementation can help in arriving at marketing ROI.

CRM Software’s have inbuilt closed loop marketing process with industry best practices imbibed in them, but there are very few implementations which have implemented the closed loop marketing process. Most of the marketing implementations are constrained to campaign management, or marketing resource management, etc. Unless response capture mechanism is in place and proper reports and analysis is done marketing ROI cannot be measured properly.

I will touch upon how CRM can help in enhancing marketing operations and measuring ROI in my next post.

Posted by Vamsi Krishna at 04:18 AM | Permalink | Comments (1) | TrackBacks (0)