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This article by Barbara Fox was prepared for the June 12, 2002 edition of U.S. 1 Newspaper. All rights reserved.

Internet Wisdom After the Boom

"The customer relationship management

(CRM) technology being sold as a silver bullet is only 15 percent

of the solution, yet it is a $22 billion industry," says David

Kramer of the Fieldstone Hill Group. "And it is a debacle.

Less than half of the implementations are performing successfully."

Kramer joins Mark Meara of the web development firm Princeton

Internet Group (PInG) and Niki Fielding of Digital Brand Expressions

(DBE) for a one-day E-strategy workshop, "After the Gold Rush,"

on Wednesday, June 26, 8:30 a.m. to 3:30 p.m at the New Jersey Hospital

Association conference center at 760 Alexander Road. Cost: $395 at

the door, including lunch and materials. Preregister for $345 by calling

Kramer at 856-642-1724.

Using role playing, case studies, and studies of organizational change,

the workshop will tell how to improve on-line customer loyalty, interactive

sales/marketing, and longer-term account profitability. Who should

attend: Salespeople, marketing people, service professionals, and

technology experts. "The workshop is based on the premise that

the Internet boom has just gotten started," says Kramer. "The

frenzy is over, but the boom has just started." Kramer will lead

the morning sessions on relationship management — how to enhance

customer loyalty, develop accounts for profitability, generate quality

leads, and improve sales force effectiveness and contact management.

Though a company’s website can be the most cost-effective channel

for building customer loyalty, only about 10 percent of companies

polled actually have a business strategy for enabling this type of

longer-term retention, says Kramer. His CRM suggestions:

Make policy changes to be more customer direct, from the

top down . "Companies in the first generation of E-commerce

thought they were getting ahead of the game by allowing customers

to communicate by E-mail. But they weren’t responding to E-mails promptly."

Work as a team to make maximum use of your data analysis

software . Such software as Blue Martini and PeopleSoft will analyze

website activity, and J.D. Edwards’ Siebel offers a marketing automation

model. But if the key people don’t want to share the data — or

don’t know how to share it — they don’t use the data effectively.

Only 25 percent of the time, Kramer says, are the sales, marketing,

and business people working together. Data resides in silos, and most

of the time the transaction silo is in the sales silo, the observed

data, such as click through rates, stays in the marketing silo, and

the results of satisfaction surveys stays in the service silo.

So the sales department might think that particular customer is profitable,

but the service department says the customer is calling the help desk

six times a month at a rate of $30 per service call. "Until they

bring the data together, they don’t know what the true profitability

is," says Kramer.

Meet to compare notes. . With or without expensive software,

the cross-enterprise, cross-functional team should sit down regularly

to aggregate data.

Identify your best customers by looking at historic client

behavior to predict future behavior. Clients are rated on a matrix

of five to one on how recently they purchased, how frequently they

purchase, and their total or average revenues. This analysis used

to be done by clustering clients in groups, but with the today’s technology,

individual client activity can be charted. "Your best customers

are in the top quadrant," says Kramer, "and 20 percent of

your customer base will make up 80 percent of the revenue. Look at

the activity and you may find that one of your best customers is purchasing

less frequently. You are watching one of your best customers defect

before your very eyes. There is no higher return on investment than

protecting a customer from defecting."

Build a customer loyalty module onto an existing website.

Kramer cites PiNG’s website for New Jersey Transit, which has a customer

loyalty module called My NJTransit. "In this password protected

section best customers can receive concierge level service — more

information, more access, more indepth contact info, message boards,

and surveys."

Benchmark the best company/client relationships . Kramer

thinks consultants should take what he calls "appreciative"

action rather than directive action. "We find pockets of excellence,

identify what works, and help the company seed and grow this throughout

the organization. With an appreciative approach, rather than a directive

approach, we elicit benchmarks in the organization."

— Barbara Fox

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Donate Please

Thanks to a challenge grant, the American Repertory Ballet (ARB) and

its associated school, Princeton Ballet School, will have donations

matched up to a total of $50,000. Two anonymous donors have agreed

to match any donations that are made through June 30 up to that amount.

"Events of last fall caused the cancellation of a tour, a major

fundraising event, as well as a number of New Jersey performances,"

says David Gray, executive director of ARB. "The opportunity

offered by this challenge grant is incredible. Our fiscal year should

end up looking much better than we had anticipated."

Tax-deductible donations may be made to American Repertory Ballet,

80 Albany Street, New Brunswick 08901.

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