CRM (customer relationship marketing) or eCRM (the digital version, although these days the terms are interchangeable) is founded on a deep understanding of customers.
Often seen as the geeky bit of marketing, the skills required include the ability to interpret data, to extract customer insight, and to act on it. They also include the ability to plan ahead, sometimes based on an understanding of what customers do, or are likely to do, over the span of several years (think: buying bigger items such as a car or a sofa).
The CRM boost
Over the past dozen years I have been working in CRM, delivering global strategies for major brands like Virgin, News International and McCain, teaching marketers core CRM skills, as well as running
masterclasses for heads of marketing at The Groucho Club. I have noticed something remarkable about people who have these skills: they make unusually rapid progress up the career ladder - so I wanted to explore this thinking in more detail.
CRM requires an understanding of the life cycle a customer is on, from first consideration of a brand to loyal consumption and recommendation
The run-of-the-mill marketer tends to get caught up in day-to-day delivery of campaigns; CRM people manage to do this while understanding the overarching context of the activity. More often than not, a campaign within a CRM programme will not drive instant revenue, but will increase the value of the customer to the brand over the course of several campaigns. This requires a long-term view. As we all know, daily pressures (get a campaign out, check copy, chivvy along an agency, test an app) get in the way of thinking big, so how does a savvy marketer make it work?
It all comes down to measurement and markers. CRM requires an understanding of the life cycle a customer is on, from first consideration of a brand to loyal consumption and recommendation. Using data skills to help map this out provides several fantastic tools at once: a long-term view of the customer relationship; a sequence of stages in the life cycle, from engagement to conversion to retention; and a series of timed steps along the journey.
A step ahead
This customer journey map is wonderful, because it allows us to think long-term while giving us sight of the next few steps. By applying some numbers to each step - let's say, 1% fewer customers stop engaging at the end of the step - when they are added up over 10 steps, that may lead to a significant increase in revenue. In other words, you can focus on the next immediate improvement, and will find, after a while, that a significant change has been achieved. It's a really simple principle.
That same principle is why some of the people who started out in the geeky bit of marketing, CRM, are now superstars leading their organisations' growth. At each step they set a target and saw what happened. Their success was measured. They proved their value to their employers and, in return, rose rapidly. Many of today's superstar marketers have CRM skills to thank for it.
Felix Velarde is chief executive of CRM consultancy Underwired and teaches at Hult International Business School and the IDM. @felixv.