Customer Lifecycle Management is hot topic in CRM today. I see a number of phases in the evolution of Customer Lifecycle Management in the past, currently and in the future. Each presents its own unique challenges.
PAST
Phase 0 – Adhoc Customer Management
Companies just manage everything in an adhoc manner.
Outbound campaigns are developed as stand-alone campaigns. Online campaigns ditto. Inbound customer contacts are managed as they arise. There is little or no coordination of contacts. Typically no software is used to manage contacts other than the ubiquitous MS Office tools.
Companies in this phase do not really manage the customer lifecycle at all.
PRESENT
Phase 1 – Fixed Customer Contact Plans
Companies manage outbound contacts through fixed contact plans. The plans don’t vary no matter what happens to the customer or what happens within the company. Often there is only one plan for all customers. Customers are assigned to plans and then follow them until the plan ends.
Outbound marketing campaigns are still developed as stand-alone campaigns. Online campaigns ditto. Inbound customer contacts are still managed as they arise. There is some adhoc coordination of contacts but only in response to particular issues. Typically, simple campaign management tools are used to manage contacts and adhoc marketing campaigns.
Companies in this phase manage customers in a one size fits all way.
Phase 2 – Semi-variable Customer Contact Plans – “Customer Pathways”
Companies manage outbound contacts through a series of customer pathways. Each pathway describes a series of linked contacts that naturally belong together, e.g. welcome contacts for a new customer or segment-level contacts. The pathways contain a number of contacts in sequence, rules for triggering the pathway and rules for switching between pathways. The triggering of pathway contacts, their execution and switching to another pathway driven by business rules embedded in pathway logic (but not usually within a business rules tool). Customers are assigned to a pathway and then follow it until the pathway ends or they are transferred to another one. The pathway the customer has been assigned to defines what contacts the customer will receive.
Outbound marketing campaigns are still developed as stand-alone campaigns. Online campaigns ditto. Inbound customer contacts are still managed as they arise. There is some planned coordination of contacts but not across the entire customer lifecycle. Typically, industrial-strength campaign management software, e.g. Unica Affinium, is used to manage the pathways, pathway contacts and other marketing campaigns. Other CRM tools are used to manage other contacts.
Companies in this phase manage customers in a semi-variable, planned way. But it is difficult to mix and match different pathways or to respond to adhoc events.
FUTURE
Phase 3 – Variable Customer Contact Plans – “Customer DNA”
Companies manage all contacts through Customer DNA. Customer DNA consists of any number of contact plans that describe how planned contacts are managed plus an emergent contact plan that manages which contacts the customer will actually receive.
Each contact plan describes a series of related contacts that naturally belong together, e.g. a lead management contact plan, a customer management contact plan or customer loyalty programme contact plan. Plans can also be prepared for outbound marketing campaigns, online campaigns and inbound customer contacts, even for partner campaigns. Each plan contain a number of contacts in an idealised sequence, plus rules for triggering the contacts, for sequencing them, for prioritising them and for carrying out the individual contacts. The sequence of contacts in the plan doesn’t fix the sequence in which they will be actually carried out, or indeed, which contacts will be carried out at all.
Customers are enrolled in individual contacts plans according to their situation. The sum total of contacts in the contacts plans they are enrolled in describes all the contacts the customer is eligible for. The actual contacts that the customer receives is identified in real time by deciding the next best contact from the contacts in the different contacts plans the customer is eligible for. The choice of which contact the customer will receive from the different contact plans, the sequencing of contacts where more than one is appropriate and the prioritisation of contacts if they clash is driven by business rules embedded in the contacts themselves. This is usually carried out using a business rules tool, e.g. Haley Systems’ Authority. Typically, industrial-strength campaign management software, e.g. Unica Affinium, is used to manage both the contact plans and the carrying out of the individual outbound contacts. Online and inbound contacts can be managed the same way, although this may require integration with other CRM tools.
Companies in this phase manage customers in an effectively infinitely-variable way. The actual contacts the customer receives emerges out of the interactions between the contacts the customer already had and those they are eligible for at any point in time. But it is easy to mix and match different contacts plans and to respond to adhoc events.
Phase 4 – Customer-managed Variable Customer Contact Plans – “Customer Managed DNA”
Companies implement Phase 3 Customer DNA in ways that allow customers to manage some of the rules themselves, e.g. allowable marketing contacts or the maximum number of contacts. This could be done by giving customers access to high-level versions of their own contact plans on-line through contact configurators. As contacts move increasingly to mobile media, it could be done by moving the configurators to mobile devices, in particular, as applications running on individual mobile telephones.
Companies in this phase manage customers in an effectively infinitely-variable way but give much more control over the contacts they will receive over to the customer.
The big challenge is to identify where companies are today (mostly Phases 0, 1 & occasionally Phase 2), and to help them evolve step-by-step to the next phase. There are also a number of other deeper challenges associated with understanding the capabilities required to deliver each phase, and how processes, systems, data flows, work routines, roles & responsibilities and org structures need to change to deliver the capabilities. New technologies will probably drive much of the evolutionary process if history is anything to go by.
What do you think? Is Customer Lifecycle Management daily business for you? Or are you struggling with inflexible contact plans?
Post a comment and get the convversation going.
Graham Hill
hello sir, i am a student of MBA (Pharm.). i am doing my major project on CUSTOMER LIFE CYCLE MANAGEMENT IN PHARMA. can u help me by suggesting some specific things on it.
with Thanks & regards,
AMIT GUPTA
INDIA
Amit
Thanks for your request.
In order to help you further, I need to kow who you believe the customer for Pharma to be?
Is it the wholesaler who organises the drugs supply chain? The hospital who buys in bulk from the pharma companies, often at massively discounted prices? The chemist who buys from the wholesaler and provides POM to end-consumers against a doctor’s prescription? The doctor who prescribes POM for patients? Or the patient who consumes whatever is prescribed by the docter, at great expense.
Will your study take into account the difficult area of ethics, both in terms of business ethics connected with highly differential pricing across the supply chain and the moral ethics (or lack thereof) of marketing directly to largely ignorant end-consumers?
Graham Hill
Independent CRM Consultant
Interim CRM Manager
Hi,
I am working in the hospitality business I manage 3 units and…I always try to acomplish the best service and best experience to our guests.
I have been reading afew artilces about CRM and CEM and there are many opinions about .
What are for you the big changes of todays and future customer?
What… is the real meaning of CRM?
Are the fundamentals of CRM actually changing or is it still about capturing the online shopper and delivering value?
Is CEM an evolution of CRM or should they be treated as separate and distinct departments?
Can we measure the impact of providing an ‘experience’ compared to simply providing a service?
Hope you can help me .
Best regards.
Miguel
Miguel
Thanks for your question. It is always great to hear from readers, whether they have a comment, a question, or whatever.
The question you ask is a complicated one. It hinges on a number of factors including, the nature of value delivered, the timeframe under consideration, the degree of organisational collaboration, support from enabling computer systems and the role of the customer amongst others.
As I set out in a previous blog posting on The Three Ages of Customer Business, CRM is continusouly evolving to meet the changing demands of the marketplace in which it operates.
If we just look at the five factors identified earlier, we see significant differences between stereotypical CRM, CEM and the next evolutionary stage, Customer Co-creation.
CRM
Value: Value is measured in terms of value to the company at the point of sale. Value received by the customer is not considered.
Timeframe: Based largely upon individual transactions with customers.
Collaboration: Mostly departmental collaboration with limited organisational collaboration.
Systems: Very expensive database driven transaction-oriented CRM suites like Siebel.
Customer: The customer is marketed at, buys and hopefully, has no further customer service needs.
CEM
Value: Value is measured in terms of value to the company over the customer lifecycle. Value received by the customer over the lifecycle is also considered.
Timeframe: Based on the end-to-end customer lifecycle, consisting of many individual touchpoints with customers.
Collaboration: Organisational collaboration required to deliver a coherent customer experience over the entire lifecycle. Partners often collaborate too, particularly where they are responsible for some customer-facing touchpoints.
Systems: Adds additional customer lifecycle systems,typically internet driven.
Customer: The customer is marketed at, buys and is serviced over the customer lifecycle.
Customer Co-creation
Value: Valie is measured from company and customer perspective during product consumption, not just at the point of sale.
Timeframe: Same as for CEM.
Collaboration: Organisation, partners and customers all intimately involved in creating value over the customer lifecycle.
Systems: The internet and more recently, the mobile internet drives customer co-creation. It provides all parties with a universal tool with which to collaborate.
Customer: Customer intimately involved in innovation, marketing, sales and self-service.
This evolution is taking place all around us. Many organisations are using all three at the same time for different purposes: CRM is mainstream and drives many customer-facing activities. It is a big value-driver for the organisations that use it. Different CRM touchpoints are being stitched together into a coherent customer experience. Value is harder to measure but possible. Experiments are taking place in customer-co-creation.
Feel free to ask more specific questions.
Graham Hill
Independent CRM Consultant
Interim CRM Manager
Dear Graham,
Thank you for your comments.
Best regards.
Miguel
Dear Sir,
Thanks for your article above. I am keen interested to know about CLM in Telcos after reading your article. Could you please describe me with other few articles or case studies?
Regards,
Liton
Liton
Send me an email with your address and I will send you a CD packed with useful information on CLM.
Graham Hill
Customer-centric Innovator
Follow me on Twitter
Interested in Customer Driven Innovation? Join the Customer Driven Innovation groups on LinkedIn or Facebook to learn more.
Dear Graham,
I recently started working on Churn Control & CLM in a telco in Bangladesh and am very interested on the contents of the CD. Could you pls share them with me?
Regards,
Ishtiaq
Ishtiaq
I have recently created ‘A CLM Primer’ CD containing various presentations, articles and other materials on CLM. If you email me your address (to graham DOT hill AT web DOT de) I will send you a copy of the CD by post.
Graham Hill
Customer-centric Innovator
Follow me on Twitter
Interested in Customer Driven Innovation? Join the Customer Driven Innovation groups on LinkedIn or Facebook to learn more.
Dear Graham,
we are master students at a university in Munich, Germany and are currently working on a presentation concerning the topic “CRM from the Customer Lifecycle”.
After reading your blog we got very interested and we were wondering if you could recommend us some interesting case studies or support us with further information.
With kind regards,
Susanne, Katharina & Daniela
Hi S, K & D
I would be pleased to help you with your stidies. What particular help are you looking for?
I have recently created ‘A CLM Primer’ CD containing various presentations, articles and other materials on CLM. If you email me your address (to graham DOT hill AT web DOT de) I will send you a copy of the CD by post.
Graham Hill
Customer-centric Innovator
Follow me on Twitter
Interested in Customer Driven Innovation? Join the Customer Driven Innovation groups on LinkedIn or Facebook to learn more.
Dear Graham ,
i have recently started working on CLM , and would like to know more about it.
Can u help me by giving inputs so that i can start working on it efficiently..
Dear Graham,
I am a student at the university of ulm in Germany. I just started my Master-Thesis with the topic: Customer Lifecycle Management with special regard on the service industries.
I already searched for informations and also found your discussion in here and i wanted to ask, if you know some good papers or books about the main topic…maybe some defintions in which the autors already suppose some kinds of phase diagram for internal control in companies.
Best wishes
Eva
Hi Eva
Send me an email to graham(dot)hill(at)web(dot)de and I will see what I have that may be useful to you.
Gruss aus KÖln
Hi Graham – I work in the fast food industry and my company has built a loyalty program and I have defined the customer lifecycle framework. I would like to build in contact/trigger rules, offer hierarchy to better the existing program. Could you point me papers or case studies of best practice or at the very least where and how to start the process.
Cheers
Leo