CUSTOMER INSIGHT: How to find and maintain good customers
Evolving from the ashes of CRM, Prospect Relationship Management (PRM) is emerging as an established methodology.
CRM was propelled onto the centre stage of the marketing arena in the late 1980s as practitioners began trading in software systems positioned as the panacea for managing relationships with customers. Doubts emerged and controversy ensued as millions of pounds were invested in CRM systems with little consideration given to the nature and quality of data or how to get at it for analysis purposes. This oversight was identified early on by many data marketing professionals who recited the 3:3:70 rule (£3 million invested, three years to deliver, 70 per cent failure). In this climate, few direct marketers were surprised by the failure of CRM to deliver in terms of payback.
Fortunately, the vast majority of companies now accept that building loyal customer relationships involves more than making a large investment in information technology. Although establishing intimate personal relationships is unrealistic in today's mass market society, detailed knowledge of customers is vital in enabling you to answer their needs and target them more appropriately. Whilst technology can facilitate this process, it is insight that drives it. So if companies have realised this for managing customer relationships, why haven't they adopted the same practices for managing prospect relationships? Or are we still living in the tactical world?