Customers Really Matter
Peter Weedfald is fanatical about customers. Weedfald, vice president, strategic marketing and new media, North America operations for Samsung Electronics America Inc., wants to grip each customer in an unrelenting bear hug of unparalleled service.
This fanaticism toward the customer has led Weedfald to redefine CRM. "CRM does not stand for customer relationship management--yet. Not yet. Because first you have to put the process and business desire in front of it," he says. "CRM first stands for customers really matter. And that philosophy must be present throughout an organization, from the receptionist all the way up through the [CEO]."
At Samsung it is. Samsung's CRM mantra can be summed up in 11 words: Every form of customer interaction and every touch point is CRM. Weedfald is the person who chants that mantra for Samsung in North America, driving it deep into the soul of the company. The philosophy is so pervasive, in fact, that any employee will give virtually the same response when asked what CRM means to the $32 billion global electronics firm.
"Every person, every product, and every advertisement is a customer touch point," says Enjin Kang, senior CRM manager for Samsung's North America operations. "We evaluate everything we do by what customers want."
And this philosophy is more than just business. It is personal. "My personal philosophy is, customers really matter," Weedfald says. If that sounds repetitive, it may be because Weedfald has spent his career focusing on customers. While working as a publisher at Ziff Davis Media Inc., for example, Weedfald made 15 face-to-face sales calls per week. On average most publishers visit three clients per week. His dedication to "beating the streets" earned him the nickname The Hammer.
Today Weedfald is focusing that passion on Samsung customers. He oversees marketing, advertising, CRM, PRM, research, the information center, B-to-B and B-to-C commerce, and business strategies for five divisions: consumer electronics, information technology, telecom, semiconductor, and home appliances. Since joining the company last October, the 47-year-old sales and marketing veteran has introduced a series of initiatives designed to strengthen Samsung's relationships with its customers. There are five CRM staffers who report to him: a senior CRM manager, who oversees the strategic development and deployment of the CRM infrastructure; an insight manager, who aggregates and reports on data collected in the CRM system; a campaign manager, who creates all new-media programs (including banners and splash pages) and the HTML codes for them; a senior manager of Internet promotions, who oversees all online promotions, including those on Samsung's Web site; and the manager of the knowledge management center, who is building the infrastructure of the center and ensuring that its data is in viable formats.
Weedfald says he is confident that their efforts thus far are unique in the electronics industry. "I'm going to put a stake in the ground and say there is not one competitor that has the CRM program we have," he says.
That program is built on touch points--and on a mass of research on the market, on CRM, and on company objectives that Weedfald has gathered.
"Touch points are all about customers really matter," Weedfald says. "If a company really cares about its customers it will use service as a touch point. The receptionist is a touch point. The sales force is a touch point. Banner ads and magazines, TV, and cinema ads are touch points. The box is a touch point. What is inside the box is a touch point."
The number one use for CRM in Samsung North America is to keep close ties with current customers. To do this Weedfald's team has focused its initial efforts on data collection and analysis using such touch points as banner ads, trade shows, customer service, and in-store research to gather information. "Samsung has done incredible as a company. To get to the next level we have to build products that consumers want, and fix problems that consumers want fixed," Weedfald says. "And the only way to do that is to build a CRM system."
Creating a consumer data collection mechanism has been the principal task over the past year for Insight Manager Peter Goodnough. His goals are to make sure that Samsung is getting the most valuable information from each of its preexisting touch points and that the information gets centralized in the system. "This is a capability that didn't exist at all at Samsung before the CRM implementation," he says.
Samsung is now also ensuring that all the information it gets from its retail touch points is codified and centralized in the same way as the consumer data. "We're working on getting day-to-day, check-the-pulse field reports on retailers and consumers, and we're turning it into a 24-hour turnaround where we can inform the point-of-sale tomorrow on information we gather today," Goodnough says.
Samsung plans to use the data to create a competitive advantage. Using the SAP 3.0 and Allegis systems on which its CRM, PRM, and knowledge management operates, the CRM team can customize information for its retail partners by product, zip code, by what Samsung and its competitors were doing the past week or month regarding price points, rebates, and such. "If we wanted to we could show them their competition without telling them the names," says Weedfald, who has fully embraced the systems although they were in place before he joined Samsung. "We could say, 'Here is what three of your competitors are doing on the shelf that you're not doing.' That gives our salespeople one more reason to make a sales call, and builds competitive advantage by giving the retailers data they may not be collecting themselves."
Another tactic is to provide the data to product managers to help them select marketing strategies and price points. By testing price points, for example, Samsung can learn whether a $20-off customer incentive affects sales volume, and if not, save some margin by not running the discount.
Samsung's centralized database and the segmentation of its customers within that database could give the company a competitive advantage as well. "I have a business plan for every one of our products. And I have to make sure that in the first sixty days we a time-to-volume company not a time-to-market company. We now have hyperchanging, short product life cycles from all of our competitors and if I don't launch right with the right data and the right pricing and the right intellect, I will fail," Weedfald says. "All the data we need to be successful is right here in the CRM, PRM, and knowledge management systems. And it's a huge weapon."
57 Channels With Something On
Banner ad campaigns that offer opt-in, permission-based programs are one of the newer touch points added by Weedfald to collect customer data. Samsung now runs 18 to 24 different banner ad campaigns 24 hours a day, 7 days a week, 365 days a year above-the-fold on 80 high-end Web sites. These banners generate more than 350 million impressions per month. "Those banners are about supply chain management, not about advertising," Weedfald says. "And if you think of it that way and bolt that into your CRM philosophy and your CRM infrastructure, then you're actually competing on a different plane [than companies that just run banners haphazardly], because that's a tactic, not a strategy."
Another information-gathering touch point is the call center. The first question agents now ask is, What is your email address? The goal is to use the addresses as case numbers for such situations as problem resolution, queries, to send authorization numbers, to lower service costs, and to initiate research. "For me the customer service department is the overall, number one touch point for CRM," Weedfald says. Now Samsung can send customers a thank-you email using trigger-based marketing, and can use that email to them to offer to join opt-in lists for information like new releases and specials. This may lead to new or incremental sales. That email address may also save the company money.
When a customer calls the toll-free number, Samsung pays for that call. If the agent needs to call the customer back, Samsung pays for that call. "We have no record, no trail, email trail, no research data trail, no follow up, no opportunity to touch that customer again, and we're spending money both ways. That's unbelievable," Weedfald says. "So you must ask them first, 'What's your email address?' And if they say they don't have an email address or they don't have a computer, that will tell us something about the customer's demographics, which is good for our research." If, for example, the call center gets a number of callers who don't have computers, Samsung may want to run their zip codes to see whether these customers fit its target demographic.
Keep in Touch
Banner advertising and email marketing help Samsung by providing data, but equally important they help the company reach its number one CRM goal, which is to keep a tight bond with its existing customers. Samsung does this through consistency, frequency, location, and relevancy. "The best way to fend of the competitive din is to stay very consistent and frequent and relevant to the customer at every touch point," Weedfald says. For this reason Samsung runs in the front-of-book (location) in every issue, whether weekly, biweekly, or monthly, in 40 magazines. Each ad is customized to be relevant to the audience of each magazine (relevancy), yet each has the same overall look and feel (consistency). "Each ad will help the other," Weedfald says, "because in advertising proper and relevant duplication is good, not bad."
Relevancy also applies when dealing with retail partners. Consequently, Samsung uses Allegis for its PRM efforts. Customers each have a customized dashboard that allows them to have such tools as their own views into their accounts and their own discount levels and year-to-dates. "This is really what PRM is all about: relevant customization," Weedfald says. "And relevant customization is easier to create for 4,000 North American dealers and channel partners than to try to deal with 265 million consumers and individual businesspeople through some sort of relationship management [software] system."
Samsung is also using PRM as a communications tool and as an opportunity manager. "It allows us to move quickly on new opportunities," Kang says.
The CRM team is in the process of building a knowledge management center that will also help Samsung identify new opportunities. The knowledge management center will be fed information by the CRM system, third-party syndicated research, and real-time data from Samsung's sales organization and its EDI and inventory systems. "It will make us smarter, and better, and more customer-centric," Kang says.
360 Degrees of Samsung
One of the drivers for creating the knowledge management center is information sharing. It was also a driver for selecting SAP 3.0 as the CRM platform. "CRM in Samsung started by changing our processes to be more customer-centric," Kang says. "The reason we employed SAP is because we use its ERP system. CRM should not be stand-alone; it should be tightly integrated with the back-end ERP system." Whenever the CRM staff communicates with Samsung's retailers, for example, Samsung's salespeople then need that information. And equally important, customers can touch anyone in the organization and they each can provide the same information the customers want. Service, marketing, sales, and product managers--about 100 people in North America so far--are all sharing information, so they can provide the same information.
This is critically important, Weedfald says, because it helps Samsung bring consistency to the customer experience. It's bad enough when a company makes a mistake with one consumer, but it worse when the mistake is with a corporate customer. "If you make a mistake on an order of 20 flat-panel displays for a customer that buys 10,000 flat panels a year, and you don't service it right and you're not consistent, you've got a big problem. You're not only making a customer unhappy, you could lose the business."
Currently, most of Samsung's CRM initiative is focused on the business information warehouse and research, because that is where the company can see immediate benefits. "We have information, for example, on our technology peripherals that we never had before. We can compare, say, positive editorial with sales spikes. That's the kind of information that was never shared across division before," Goodnough says. "Now that we have consolidated and rolled this tool out to each of our divisions across North America, we can discuss these things and get for the first time an idea of what Samsung looks like as a whole across North America."
The company also plans to roll out its CRM as a decentralized system. Although that is not yet complete, each location--Dallas; Irvine, Tex.; Ridgefield Park, N.J.; Canada; and Mexico--has a CRM leader and a Webmaster. The local CRM leader is responsible for coordinating all CRM activity in terms of retailer and consumer data collection. "At this phase of the CRM program, I look at it as research consolidation across North America. SFA, for example, is only active for the consumer electronics division," Goodnough says. This is due to the way different divisions sell, he says. The information technology division sells 60 percent through resellers, whereas the consumer electronics division does very little reseller sales. So the CRM team created a system specifically for the consumer electronics division at first. That will be rolled out across divisions in the next year, and in the next two years for North America as a whole.
"This has a multitude of uses in terms of planning and developing new products, analyzing what works and what doesn't--all of this is to be linked to heads of divisions in Korea to give them real-time data on what's happening in North America. They then use that information to do regionally on a worldwide basis what we can do locally," Weedfald says. "Samsung has invested millions [on CRM] worldwide. But we're still ensuring that all of the touch points are validated, turned on, and become part of the process. We still have some work to do, but you can see the massive, snowballing competitive advantage we have."
Peter Weedfald One-to-One
Peter Weedfald, vice president, strategic marketing and new media, North America operations for Samsung Electronics America Inc., discusses in a recent conversation with CRM magazine Managing Editor Ginger Conlon, why having a personal CRM philosophy is integral to the success of a CRM initiative.
CRM: What is your personal CRM philosophy?
My personal philosophy is customers really matter. It's understanding that if you lose one customer you may lose hundreds more. A simple example of what CRM means is this: Samsung runs advertisements in magazines, and I take the time to pick up the phone and call my own ad.
I can tell you that if you pick up the phone right now, and ask 40 people who run marketing for their companies and you say, "You just ran an ad with a 1-800 number, have you called it personally?" I will bet you that 99 percent will say, "No, I haven't called it. I'm the vice president of strategic marketing." These executives have just spent millions of dollars to do a touch point of communications to consumers, to retailers, to the channel, and then they never check to see the experience.
CRM: What happened when you called Samsung's toll-free customer service number?
I found there were areas to improve. Now I've only been here since last October, and it was the first time I'd run all these ads. So calling the contact center made me realize that we needed to inform agents about these new ads. So we improved our communication with the support center, because it's critically important that the experience that the consumers and retailers have is, in the language of CRM, best of breed.
CRM: How else have you tested Samsung's CRM efforts?
I go shopping. If I really care about my customers--consumers, retailers, and channel partners--which I do, when I go to do an executive meeting at one of these retailers, I would really be ashamed to think that I didn't have a shopping experience at one of its stores before I meet with its president. So I do it all the time.
CRM: Give an example of a recent shopping trip.
To the store manager's astonishment, I went to Tweeters to buy a Samsung DVD-2000. When it arrived at my office my team and I opened the box to live through the experience.
We build a list of questions [to use when we call Samsung's customer service], the first of which I call stupified questions. These are questions like, "Hi, I just got this, but I can't seem to turn it on." How do the CSRs respond? Then we break something on it and ask, "What do we do with it now, how do we get it fixed?" because it has a warranty. We try to go through the experience, and we should go through the experience. And shame on anybody who has the discipline of spending money on advertising and marketing communications and shame on anybody who is the king, queen, or nobility of CRM and doesn't go through that process.
CRM: Why do you do this?
If a consumer buys a product and has a problem, she will first call the retailer. So now I have two bimodal customers: the retailer, who doesn't want to get calls on boxed products, and the consumer. This is a big job: Customers really matter. So I better make sure all of this really works. And I want to see, What is the in-box experience? What's in there? Brochures, warranty cards, the manual? Companies must have a market-driven philosophy that says, if you don't love customers, if you don't want to take care of our customers and worry about them, you're in the wrong place. It needs to be in the blood. This philosophy needs to be in the DNA of everyone in the organization to withstand the wrenching pain of building the technology infrastructure. CRM should look like this: We have our customers' best interests at heart.
CRM: How else do you conduct in-store research?
Samsung retains a detailing firm. This company visits retail stores that sell our products to check Samsung's stock, check the competitions' prices, features, and benefits, talk to customers to find out whether they're thinking of purchasing a Samsung product and why or why not, check whether current rebates or other offers are on the shelf. The detailing firm reports directly to me. The reason is that I have positioned and gotten buy-in in the company that the detailers are an extension of CRM.
Every day these detailers, at the end of their day, go to the Internet to deliver all that data back to my CRM department. Through data mining we will be able to distinguish relevant data and get that back to our product development group, sales organization, marketing communications group. And we will have instant unionization of push and pull though incredible supply chain management of communications, marketing, advertising, and data that will give us a competitive advantage.
CRM: How does your personal CRM philosophy mesh with Samsung's corporate CRM philosophy?
I want to reach out to those people who have rewarded Samsung by purchasing our products. I want to thank them by showing them that we're coming out with the latest, the newest; that our service and support is strong; that if you call our 800 number for information, we give you the information. We do this so that you'll be an extension of our marketing and salesmanship.
The number one person who I am trying to advertise to is people who have already bought my product. I'm willing to bet that nearly 100 percent of my competition would never give you that answer. They're probably trying to reach the informed, the early adopters, those who shop at shopping malls. Good. Let them keep thinking that. Because I want to reach [the more than 50 million Samsung customers] and remind them that we work twice as hard, three times as hard to deliver the best service, the best support, the best usability experience. And when I reach back out to them through advertising, they say to themselves, "Aren't I smart? Aren't I happy? Aren't I lucky? Aren't I the greatest." These people then want to evangelize the company.
The 7 secrets of CRM
1. Start with a personal CRM philosophy
Managers who oversees a company's CRM initiative must have their own CRM philosophy before they can successfully create and promote their companies' CRM philosophy.
2. Remember that every customer contact is a touch point
This includes people, from the receptionist to customer service reps to salespeople; communications, including ads, email marketing, direct mail, and Web sites; products and packaging; even partners.
3. Realize that marketing and sales are the same
A salesperson's goal is, in the space of one sales call, to get the prospect's attention, interest, conviction, desire, and close him. An advertisement has 30 seconds to get the prospect's attention, interest, conviction, desire, and close him. It's the same process for both.
4. Experience your own CRM
Managers who oversee their companies' CRM should periodically call their toll-free numbers with test questions to experience service from a customer's perspective. Managers should also go through the process of purchasing their own products, sign up to receive their own email newsletters, and place themselves on the mailing list to receive their own direct mail.
5. Benefit from CRM as a science of research
Use the information collected from customers, Web site data, and partners to create more powerful, targeted messages and programs.
6. Know that CRM is choice, not chance
People have access to more information than ever on products and
services to help them make purchasing decisions. Providing them with choice--product choice, communications/media choice, service choice--will lead them to your company. Otherwise, you're just leaving your sales efforts up to chance.
7. Create the unionization of push and pull
Supply chain management of marketing, communications, advertising, database information--that's highly relevant and highly personalized--creates the unionization of push and pull between a company and its customers.