• February 1, 2006
  • By David Myron, Editorial Director, CRM and Speech Technology magazines and SmartCustomerService.com

Experiences Versus Relationships

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Beware the buzzwords. One doesn't have to watch the technology industry very long to see that the same tools, over time, often take on different names. In the late 1990s the application service provider market became the hosted software market, which changed to the on-demand market, and is now called the software-as-a-service market. Essentially, all of these names represent the same thing: the ability of companies to rent software from a third-party vendor to avoid the large overhead costs associated with buying, implementing, and maintaining the system. Vendors and consultants often latch onto the newest buzzword, or, if they're crafty, introduce a new buzzword to make their products or services appear to be more innovative. Sadly, it adds more clutter and confusion to the market. CRM should be impervious to these kinds of distractions, despite industry spin doctors' best efforts, as customer relationship management is not solely about the technology, but also the people and the process. Those who don't understand CRM, or those who do and want to prey on the ignorance of others, posit that CRM is a technology strategy only. They might even point to Oracle's acquisition of CRM giant Siebel Systems and cry that it's the end of CRM. And, unfortunately, the poor saps who believe this may buy whatever the vendors are selling as the next technology to replace their CRM technology. So naturally, my concern for technology buyers was piqued when I recently discovered merchants and analysts pushing CRM strategies and technologies with new three-letter acronyms. To avoid adding to the industry clutter, I'm intentionally excluding the new acronyms from this column. However, I would like to touch on a concept that CRM naysayers are latching on to, that is, building positive customer experiences instead of relationships. I'm all for creating positive customer experiences. In fact, in the December 2005 issue of CRM magazine, my Front Office column highlighted the importance of companies selling not just a great product or service, but a great customer experience. I explained how I gave my once-preferred airline a chance to win my loyalty back. (It didn't: Please see the column "Straighten Up and Fly Right" to find out why.) When companies deliver customer experiences that foster positive emotions, customers are more likely to reward those companies with repeat business. Positive customer experiences are crucial for businesses, but they should not replace customer relationship efforts. Doing so is the equivalent of a general trying to win a battle and not a war. Simply put, an experience starts and stops. A relationship, which should include many positive customer experiences, is continuous and requires more effort to satisfy customers over a long period of time. Good relationships, over time, generate more value for customers and, as a result, more revenue for businesses. Companies should strive to deliver positive customer experiences, but these efforts should not replace a CRM strategy--they should be part of it. David Myron Editor-in-Chief dmyron@destinationCRM.com
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