CRM is not a Commodity if used with Imagination

Romi Mahajan, President Pepper
Ann Eberle Thomas, CRO Pepper
Dharmesh Godha, President Advaiya

In a recent discussion with an executive, CRM software came up as a hot topic. Her assertion was that too many customers see CRM as a “commodity” and thus balk at upgrades, new purchases, and list-prices. The comment was interesting for a variety of reasons of which the most important was the degree to which this flies in the face of the claims (obviously) that CRM providers make. After all, they argue, if your customers are your lifeblood (as you claim) then how can the system that enhances your ability to build long, loyal relationships be relegated to commodity status? Isn’t a CRM system your best front-end to the customer and as such a core tool to boost sales? If so, how can you think of it as being “just there?”

Commodity? Not a commodity? The grass is green on both sides of the fence, but that is because our imagination has failed when it comes to both CRM and software in general. We continue to make software fit our calcified methods and processes versus letting it liberate us from these very constraints.

Let’s focus on CRM as an illustrative case. From the beginning, organizations have had relationships with their customers- this is simply a truism. Before machines, before computers, before software, before it all, organizations connected with customers and prospects and conducted business. But when some decades ago, intrepid entrepreneurs like Tom Siebel and Marc Benioff realized that specialized software solutions could be used to enhance an already existing idea, the category “CRM” was born. Once the genie leaves the bottle, it cannot be put back in. Once a category is in the world and the lexicon is understood by all, it takes on a life of its own. As such, today CRM is a decabillion dollar business and there are over a thousand companies that build CRM solutions and platforms.

When faced with so many choices and so many seemingly mundane applications of the category, it is no wonder that many think of it as a commodity. This is an understandable if unfortunate fact. When we take an existing idea and an existing process and simply make it “a bit better” with software, the software itself is measured in increments of value. The game in this case is linear.

What if, however, the CRM system allows you to quickly revisit the taxonomies and hierarchies you’ve held as sacrosanct before? What if the CRM system allows you to do different and dynamic things at scale whereas the previous dispensation made those ambitions impossible? In these cases, CRM is not a commodity but is, to use an overused term, a game-changer. Here, the game is non-linear.

That indeed is the nature of innovation. Incremental change and enhancements are good but when an entire epistemology or process is changed, innovation occurs. Innovation is very much a product of the outcome. As such, customers are thus the judge of whether a software solution is innovative or not.

Coming back to CRM. Yes, organizations have from time immemorial “related” to their customers, but the ability to do it not only at scale but by bringing to bear a variety of otherwise disparate data points, is powerful and indeed innovative. The watchword here is “integration” and how it relates to customer engagement. Customers are not monoliths, given to a unidimensional description. They are active, dynamic, multi-faceted beings. When CRM can help you not only discover deep context but also capitalize on it to offer value to these customers, then it ceases to be a commodity.

It requires us to use our imagination.

Written by Paul Dunay
Paul Dunay is an award-winning B2B marketing expert with more than 20 years’ success in generating demand and creating awareness for leading technology, consumer products, financial services and professional services organizations. Paul is the global vice president of marketing for Maxymiser a leading web optimization firm, and author of four “Dummies” books: Facebook Marketing for Dummies (Wiley 2009), Social Media and the Contact Center for Dummies (Wiley Custom Publishing 2010), Facebook Advertising for Dummies (Wiley 2010) and Facebook Marketing for Dummies 2nd Edition (Wiley 2011). His unique approach to marketing has led to recognition of Paul as a BtoB Magazine Top 25 B2B Marketer of the Year for 2010 and 2009 and winner of the DemandGen Award for Utilizing Marketing Automation to Fuel Corporate Growth in 2008. He is also a finalist for the last six years in a row in the Marketing Excellence Awards competition of the Information Technology Services Marketing Association (ITSMA), and is a 2010 and 2005 gold award winner in Driving Demand. Buzz Marketing for Technology, Paul’s blog, has been recognized as a Top 20 Marketing Blog for 2009 and 2008, a Top Blog to Watch for 2009 and 2008, and an Advertising Age Power 150 blog in the “Daily Ranking of Marketing Blogs.” Paul has shared his marketing thought leadership as a featured speaker for the American Marketing Association, BtoB Magazine, CMO Club, MarketingProfs, Marketing Sherpa, Marketing Executives Networking Group (MENG), and ITSMA. He has appeared on Fox News, and his articles have been featured in BusinessWeek, The New York Times, BtoB Magazine, MarketingProfs and MarketingSherpa. Paul holds an Executive Certificate in Strategy and Innovation from MIT’s Sloan School of Management and a bachelor’s degree in Marketing and Computer Science from Ithaca College.