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June 26, 2009

Recycling Adoption

It is a truly great thing that it is getting more possible to recycle these days. More and more of the client offices I visit and public locations I travel through provide that special bin for depositing the unneeded plastic bottle or soft drink can. Even the airlines are getting into the act by separating newspapers and plastics from the rest of the rubbish.

This is a great example of successful user adoption in my opinion. Although, it has been a long and bumpy road we have been traveling down. In my part of town recycle day is every other Tuesday and it sincerely warms my heart when I see my neighbors placing their empty wine bottles and cat food tins in that special green plastic carton instead of their trash barrels. Conversely, I try not to get too irritated with the neighbors who don’t place their green plastic cartons curbside on every other Tuesday, even though I am certain their trash barrels are full of newspapers, cans, water bottles and flattened boxes.

If you believe the information from the people who collect and analyze this stuff, one trend that is not following quite as well as this increased willingness to separate one’s trash is the adoption of sales force automation. I have had a chance to review some studies – not stuff from the late 90’s – we are talking about findings from research conducted over the last year. These folks, who specialize in this stuff, tell us that SFA implementations are at an increasing rate of execution. Everybody is doing it, so it seems. Of course it does make sense. There is no more excuse any longer.

The technical abilities for managing sales activities and account details have become accessible through both affordability and functionality advancement. There is no reason for a sales function to operate without the enablement provided by SFA platforms. According to the aforementioned research, pretty much everybody is on board. That is, they have the software, but the research also shows they are not necessarily using it. This is the part I find most amazing. The deployment rates of these software packages are increasing, but the adoption rates are not. People may be more willing to recycle their empty milk containers, but they don’t want to capture their progression of sales stages on the small screen.

One might think after all this time we would have learned what is required to get these programs to deliver success. In fact we have. I think the problem is that too many of these projects are of the SaaS variety. Folks are taking the pay-as-you-go approach and they think they don’t need to address all the variables of the larger on premise implementations. That is a fallacy which is leading a considerable amount of these lower cost projects astray. Just because the software costs less, does not mean that the challenges of adoption go away. In fact they remain absolutely the same.

There are actually quite a few things that need to be done to assure that SFA tool adoption happens successfully with sales reps. However, if I were to boil it down to the two most critical, it would be the following.

Potencia Naturale

The first factor is all about the balance between WIFM and the hassle factor. Asking sales reps to enter a bunch of data for somebody else’s benefit is a bad idea. They need to get something back. It is a lot like putting a nickel deposit on a Coke bottle. If you want the glass back you need to give the consumer something in return. That has been a great scheme. In order to get people to store up all their beer cans in the garage they need to get a buck twenty back for each case they return. The same thing goes for SFA. If you want for sales reps to capture customer profiles to benefit the marketing department, they need to get something back in return.

However, it is not that simple. There is also the hassle of keeping all those cans in the garage. Is it worth a nickel each? Well, in California they had to raise it to a dime. And in Maine wine and liquor bottles got up to 15 cents. We have to make the ratio work. The what-is-in-it-for-me portion of the equation has to be greater than the hassle of doing the work. In some cases capturing call data after each visit is perceived as less of a hassle than creating the weekly call report on Friday nights from scratch. But, if all we do is make the forecast better for the boss on the backs of the field reps, cooperation is bound to be poor.

But then you should ask, “Why do folks recycle if they don’t get five pennies back for each bottle?” That is a great question and it leads us to the second critical adoption factor that we might think of as accountability of purpose. Getting accountability is a big deal all by itself. Lack of individual accountable is a huge problem for CRM. If you don’t expect that people participate, there is a good chance they won’t. But just meeting compliance requirements alone can leave a customer data base somewhat sparse. I often hear the complaint from my customers that users do what their told, but only the bare minimum. That won’t help our landfills.

I spend between one and two hours each week dealing with our family recycle volume. This is not something I do just to meet a compliance requirement. I feel committed to this process because I believe in the end game. Do the sales folks even know what your end game is? This is corny, but your users do need to believe in a higher calling, and feel accountable to achieve it. The individual sales rep needs to believe that by entering information about his or her customer visit the information will become intelligence, serving him or her in return, plus serving the organization as a whole. Marketing campaigns will improve, forecasts will be more precise, product development will be more effective, and the organization will increase its odds of winning. This connection to the greater purpose will drive adoption beyond compliance and toward solid program ROI.

This second primary SFA adoption factor is all about having a strongly defined, communicated, and supported purpose. It needs to be driven from the top, reinforced in the middle, and constantly reminded to the folks on the front line. It goes beyond compliance of entering data. It is about being accountable to helping the organization thrive. When combined with the focus on individual benefit, this one-two punch will greatly improve your program success.

Don’t forget, that plastic ice coffee cup, lid and straw can be recycled.

June 19, 2009

Mix It Up

Lately, I have been involved in a number of conversations regarding segmentation and targeting. I state it this way, segmentation and targeting, as if it were one topic with two words in the name because that is how many folks I have been interacting with refer to it. Combining the two terms, as if one, is a bit like giving this the status of something like gin and tonic. Gin and tonic water are two uniquely different things, but when mixed together they become a single, recognized entity. Segmentation and targeting are two uniquely different things and when combined together don’t become an entity, they remain two different things.

Now, the first thing you might ask yourself is, what possible difference does it make if people refer to these two things as if they are one thing? My answer is simple. They serve two different purposes, and if they are mixed up, there is a good chance you are getting the benefit of one and ignoring the utility and benefit of the other. I think it is important to get the benefits of both. If you mix gin with tonic (and add a wedge of lime) you get the benefits of both. But if you mix up segmentation and targeting, you are probably assuming they are the same thing and you are accomplishing only a portion of the value of what each can bring to your CRM program.

My here plan is to offer up my definition of each topic plus make some effort to show how they might be connected (but not synonymous). However, without doubt, I will define them incorrectly according to one of your favorite marketing reference books. Likewise, I will define them in reverse according to some of you – this I know because I have already engaged in that debate. No matter, I stick with these definitions, and I think you can find them useful. Here goes.

Segmentation – this is the process of differentiating your customer and prospect base into discernable categories, which aid in positioning the correct resource with the correct segment. Mostly this helps determine who talks to whom and who gets the priority attention. My customers use segmentation most often for territory management and channel assignment. For example, A customers get top coverage by the field sales force, B customers get secondary coverage by the field and primary coverage with tele-sales, and C customers get covered through the web and by tele-sales if they come through a campaign. You can use a number of different criteria for segmentation. Consumer banks use socio-economic status. Many B-to-B companies use factors that indicate buying potential. Some companies just follow a simple formula based on size (revenue, employees, customers, etc.).

Peculiar Customers

Targeting – this is the process of selecting customer or prospect segments or sub-segments for the purpose of a specific activity, such as a campaign, messaging, or promotional program. Targeting is all about rifle shooting versus the shotgun approach – getting the right message or offer to the right customer at the right time. Typically, targeting takes the basic categories of the segmentation structure and then divides up the population by another characteristic such as buying behavior, purchase lifecycle stage, customer base, or other trait. While there are a handful of common segmentation criteria, there are literally hundreds of thousands of criteria for targeting, all industry specific.

So, what is all the fuss about getting these confused? They serve a different purpose. Segmentation is really critical for building account strategies. Targeting is really critical for building marketing plans. Yes, they have a key overlap. Targeting typically takes into account the segmentation structure as one dimension, but it is usually more refined – there are more target groups than segments. Account planning can also include targeting strategies, and are best if done in collaboration. But, if you mix them together and think they are the same thing, chances are you are leaving out something.

Relying only on the process of segmentation probably means your messaging is only as refined as your segments. Relying only on targeting probably means you are focusing on the messaging process, but not on differentiating your focus on territory management and the prioritization of your reach. One crude distinction that I tend to make is that segmentation is a sales process and targeting is a marketing process. But, that is a dangerous simplification as they really need to be well integrated. Unfortunately I have seen too many companies where sales uses one segmentation structure for managing accounts and marketing uses a completely different targeting structure for programs. This is a disconnect that promotes the typical issues we see between these two functions. Targeting and segmentation have to include some element that links the targets to the segments. A lot of budget can be wasted on campaigns otherwise.

Mix up those gin and tonics, but keep your segmentation and targeting integrated not mixed up.

June 12, 2009

Healthy Dissent

The news from Tehran is quite compelling. A nation is rising against tyranny and we are watching it live rather than reading about it in history books decades or centuries later. More importantly we are watching stuff happening that is at the absolute core of the human spirit play out in prime time, and it is not reality TV. I wish reality TV would go away, but that is the topic for a separate posting.

One of the aspects of the story of the current Iranian drama is that drama is what exactly it is. We don’t know how the story is going to end. And, we know there are a number of different endings where this can lead. The tearing down of the Berlin Wall was one story we witnessed through the news that ended in an amazingly positive outcome. The democracy protest in Tiananmen square came to a less desirable conclusion. As I write this, we do not know the outcome (but it will be shortly determined following this posting I suspect).

Certainly we can speculate and compare the situation in Iran to that in East Germany and China. In the one situation, the social movement and momentum carried by the people was stronger than the political will of the government. As a result the Wall came down and the Eastern Block crumbled. In the other, the political (and military) will prevailed and Communist China remains. Although I am certain others may argue that there is a new revolution afoot driven by capitalism instead of protest. The outcome in Iran will be determined by this set of competing forces – social versus political will.

What can tip that balance and drive the outcome one direction or the other? I suspect we could find a number of variables through a study of history, but I am certain that the variable this time is going to be the infamous Web 2.0.

CNN is getting its best evidence of the protests from sources such as Facebook videos posted by everyday folks using mobile phones to shoot the history they are in the process of making. The Iranian government is doing its best to squash the formal journalists from reporting, but the virtual reporters, numbering in the thousands, have taken over the process. As long as the internet remains available in Iran, this revolution may have legs.

This is serious, serious stuff – human dignity, freedom and lives are at stake. The same technology that helps us sell our used goods on Craig’s List is fueling something phenomenally more significant. And it is even more amazing that we watch it all unfold while we are sitting at the dinner table.

Demonstracion Azur

At the risk of trivializing what is unfolding in the Persian Gulf, I have to draw a correlation. It is what takes place on this blog site after all. This same software that is facilitating a nation toward the brink of something extraordinary is in use every minute of every day potentially assisting the nation that might be described as your customer base to travel a similar path. Today, while you read this, there are customers of yours sharing their views of your product. They may not be posting videos (or in fact they may) but the process is the same. They are either endorsing your rule or trying to tear it down. They may be revolting against you, but it may not be reaching a threshold of interest that it is making the news (yet).

What is your web strategy? Are you monitoring the appropriate sites for content related to your brand or products? Do you have a user-driven content function on your site? You might ask in return – if you were to enable your upset customers to drive content on your site, wouldn’t that be the same as the Iranian government promoting Twitter for their angry citizens? The answer would be, yes.

But, if the Iranian government were to do something so bold, it would come from a strategy and policy driving other behaviors not in parallel with their current path. They would not rig elections; they would be taking stronger action to serve their citizens according to need; they would be using the media to monitor opinion, not to snuff out dissent.

Dissent is equal to failure in government and business. If you have a rebellion by your customers you have done something wrong. What you want to do is find out if that sentiment is growing before it becomes significant. You don’t want to learn about customer dissatisfaction on the news. You want to find out in time to take action (not to jail your customers but to learn from them). If you are getting signals of dissent, you need to embrace it – listen to it carefully so you can take corrective action before it is too late.

Social networking sites are one of the best places for you to manage the process of customer dissent and it needs to be a significant component of your customer strategy and customer feedback process. Or, you can take a lesson from history and follow a different policy.

Let them eat cake.

June 05, 2009

Caps and Gowns

This is the time of year for graduations. And, it is the time of year for graduation speeches. One of my favorite stories about graduation speeches was something that ran a circuit through the web a few years back. Apparently, the highlight of a graduation address made by Kurt Vonnegut Junior at some nameless school was the recommendation to wear sun block. Ultimately it turned out to be a misrepresentation, and Mr. Vonnegut, one of my favorite authors, never actually delivered the much acclaimed speech. I wish I did not know the truth – because I thought it was a really great recommendation.

This year I have heard my share of speeches. One of them was along the lines of what is probably the ultimate graduation speech cliché – this is not the end of something, but, rather, it is the beginning. That was all fine and well and I could have done a cliché blog entry as a follow up, but it was the last of the addresses that I sat through that I enjoyed the most. When a student is selected to address their own graduating class, there is a very good chance that this person earned that honor based on their academic record, and the correlation with being a bit of a nerd is, therefore, pretty high. Because of that, it was all the more poignant that this speech came from the very mouth of someone who fits in that demographic classification.

After being in a school gymnasium for already much, much too long, this was not a monologue I was looking forward to. And, it started out predictable. Then, all of a sudden, this individual with a GPA higher than statistically possible makes a personal disclosure. If you are nice to other people, she learned in the last weeks before graduation, they will be nice to you in return. Then, amazing revelation that it was, she declared it is actually possible to have fun and be a brainiac at the same time. Outstanding.

I am not altogether sure if everybody in the school gymnasium was hearing the same thing I was hearing, but this 18 year old was confessing in front of 2000 members of her community that she just figured out how to be a happy functioning member of that same community. Wow. It turns out that is not all about performance. Her summary advice to her peers – make sure you balance enjoying life with working hard. The message wasn’t the revelation. The fact that this was such a recent revelation to her was the revelation.

Conveniently for coming up with blog material, two of my clients at the same time were reaching a similar conclusion. Being nice to customers causes good things to happen – you can have fun and perform effectively.

Much of the focus of my work with clients is centered around strategic planning. You have read previous entries on this site referencing my recommendation that CRM programs should target growth, efficiency or customer experience as a primary direction. Without question, the extreme majority of programs focus on growth or efficiency and seldom do the programs I encounter target the improvement of customer experience. Fun does not pay the bills.

A number of years back I did some research on the origins of CRM. There is a bit of variation in the general history, but there are roots in the three primary functions, sales, marketing and service. Each root of this family tree seems to take credit for the genesis of CRM. From a customer service perspective, some of the original focus on improving customer interactions was given life from the quality movement of the latter part of the previous century. The whole value proposition in that argument was that an improvement of customer service quality would lead to increased customer satisfaction. Interestingly, at that time, an improvement in customer satisfaction was viewed as something to pursue.

For the last decade, the concentration has been on the other two potential business outcomes. CRM investments must to lead to improved revenue growth or decreased cost of commercial activity or it would not get funded. What happened to the good old days of the quality movement? Is customer satisfaction no longer a viable business benefit?

Then out of the blue, two clients want to use CRM to improve the quality of the customer experience, with the belief that doing right by the customer will do right for the company. Next, I hear a speech declaring the importance of balancing high performance with fun. All the while we have things in the news about the need for bringing back business ethics to combat our economic problems – the era of “greed is good” is finally over.

Are these things related? I’ll let you decide. My advice?

Wear sun block.

Flying Mortar