Driving Customer Relationship Management

I went to a presentation at the Institute of Direct Marketing the other week. It was about Customer Relationship Management in the car industry. Since we’re talking about the second most expensive purchase in many people’s lives and one they only undertake every three years or so, I wasn’t sure what the relevance might be to other businesses but…

In a campaign for Vauxhall Opel, prospective customers received a dozen communications- emails and postal mailings and the odd phone call- in the build up to their purchase. It was shown that, provided the messages were relevant and varied, people were very happy to receive regular contacts. Not only that, they were willing to part with quite a lot of useful personal information. The net result was 3 times the sales conversions compared with a control group who received no communications. Lesson: Regular tailored communications work.

The Toyota campaign made the same point. They spent a lot of time tailoring their communications to their customers’ level of involvement- whether they are prospects, new, established, lapsed.

Talking of customising your marketing to your customers, where do Toyota’s best ideas come from? Customers. They found that whereas 5 out of 6 ideas that came from ‘brainstorming’ within the office failed, 13 out of 14 ideas generated from observing customers succeeded.

Word Of Mouth Plus The Internet

In a further piece of research, Toyota identified Word of Mouth from friends and family as the most important influence on a customer’s choice of purchase and the internet as the biggest source of information. These facts are not surprising in themselves perhaps but put the two together and you throw marketing as we have known it on the scrap heap. In future, customers will be talking to one another on the internet and ‘friends and family’ become a vast network. The implication is that businesses will have little control over the message potential customers are receiving about their product.

To take theatre as an example, at the moment producers and venues rely enormously on mailings, print and press advertising to attract an audience to a new show. They are well aware that, once the show has opened, word-of-mouth generated by people who have seen it and then talk to their family, friends and colleagues has an effect. Even so, most people don’t know someone who’s seen the show and continue to be influenced by media coverage and marketing.

Supposing as soon as the first preview has taken place, lots of the audience are spreading their views about it far and wide across the internet? Even today, some people are checking what the word on the web is before purchasing their tickets. Imagine what will happen when there’s a lot more opinions available and the majority of theatre-goers are using them as a major source of information.

It’s clear we will need to use many new ways and techniques with which to market to customers and these will involve listening to, responding to and opening up dialogues with them.