Given the difficulty of finding an univocal way of defining "CRM's universe," it is better to try and investigate its practical role, i.e. how it supports the different roles the customer takes up in his relationship with the provider: at any particular
108 The Evolution of Customer Relationships and Customer Value
moment the customer must be considered in the most suitable way. CRM inter- venes in an attempt to identify the correlation between these roles and the com- pany business and provides the technological tools that will help the company to interface with the customers. A great many tools are available for the number of goals identifiable in customer support, so that the company will have to devise the right tool, for the right time, for the right "target" each time.
A simplified version of Griffin's table (Griffin, 1997) can be used to identify five main customer figures arranged in order of growing importance, from the stand- points of support required from the company, difficulty of task and, above all, profitability:
• Customer as a prospect,27
• Customer as a number,
• Customer as a business partner,
• Customer as an E-customer,
• Customer as an asset.
The first stage in the customer's life cycle is the prospect stage, when the com- pany's aim is to tum him into an actual customer. In this phase a typical CRM tool comes up: SFA28 software specifically allowing gathering and sharing of inform a- tion about the customer even if it originates from several sources, functions or contacts, thus making it unnecessary to open too many files and spreading data and efforts, so as to manage the opportunity in the best possible way and to realize it with a purchase.
It is self-evident how an integrated CRM system, as opposed to the data islands often lost in company terminals, is a vital component in the management of an effective relationship with the potential customer.
The next stage, which is by no means the last, is to consider the customer in terms of a well-identified account, in which all the data concerning transactions carried out are recorded and maintained: in this way a powerful CRM tool, the data ware- house, comes to life. This is the basis for the development of a customer service with targeted marketing policies and for the implementation of other tools, such as data mining (Berry, Linoff, 1997; SCN Education B.V., 2001).
27 Term used in marketing to mean a "potential customer".
28 Sales Force Automation.
Understanding the Role of the Customer 109
The attainment of the role of business partner (third stage) implies that CRM is definitely interpreted as a holistic vision of the customer's activity toward the company. An ERP29 system that is able to monitor and support the company's per- formance at any given moment of the providing relationship makes it the basic core of CRM solutions. In order to treat customers as real partners it would be advisable to allow them access to the ERP system - through a self-service pro- tected portal - both for reasons of transparency and to show an attitude of actually sharing and valuing the relationship. This system of real-time position checking can solve a number of problems that can come up, often involuntarily, concerning communication, procedural agility, etc.
Nowadays a new, internet-related way of doing business is emerging: many claim it will take over, but for the time being it is just one of many ways. E-Business re- quires tools and attitudes peculiar to itself, which simply did not exist even as little as 10 years ago. The CRM galaxy is just starting to adjust to this trend through a branch that will soon be self-contained, called E-Crm (West; 2001). Typical applica- tions for approaching the customer are, among others, the multichannel E-customer interaction management,30 E-customer click stream analysis,31 E-customer loyalty management,32 etc. E-CRM's main objective is the attainment of a fair level of integration among its components, in order to become an indispensable tool for web-active companies (Seybold, Marshak, 1999; Griffin, 1997; Brown, 2000).
It might be interesting to try and spot a possible life cycle for an entirely web- managed customer.
Every company employs resources to preserve the goods that make up its patri- mony (this is the final step). The specific feature is that it was only with the intro- duction of CRM that many companies realized the importance of effective man- agement of one of their most substantial goods: the customers (Blattberg, Getz, Thomas, 2001). In the CRM environment a number of companies are successfully implementing data mining and data warehousing systems, as already mentioned, knowing they will be better able to achieve their targets of customer satisfaction and trying to find new ways to increase the number and profitability of their cus-
29 Enterprise Resource Planning: a software solution allowing direction of an organization's requirements in order to meet the company's needs through tight integration of all its functions.
30 The multichannel DE-customer interaction management is designed to manage relationships through all web-supported communication channels: chat, e-mail, voice service, fax, etc.
31 E-customer click stream analysis analyses the customer's behaviour through the "stream of clicks" he leaves during his navigation sessions, in order to prepare ad hoc actions for the subsequent contacts.
32 Customer loyalty management seeks to spot bonus and incentive policies for frequent web-buyers, in order to increase their visits to the site that rewards them.
110 The Evolution of Customer Relationships and Customer Value
Identification Web site access.
direct or through banners
Cross-selling and up-selling Marketing one to
New products/services info
Acquisition at i fact ion repon
Fidelity initiatives
Request for new information
Figure 6.7 Customer life cycle
Retention New purchases
Web site registration
Information Improvement request
First purchase
User support
tomers. Customers are in fact some of the cheapest and most reliable critics of acompany's activity, and analysing them with data mining tools can help to evalu- ate the direction the company is taking, as well as supporting the decision process.
Since all companies have an - often unused - transaction data recording system, it is easy to predict that they are all going to implement a CRM system in the future, given the innumerable advantages it offers. The first thing that has to be under- stood is what roles the customers can adapt in order to design a suitable architec- ture that reflects the company's actual needs. CRM is only successful if the cus- tomers see it as a single, consistent interface between themselves and the com- pany, rather than as a number of disconnected and uninformed realities managing the relationship as autonomous units.