Beating the Competition

Connecting to customers, listening to customers, and letting customers connect to each other have never been so important, and are all critical to CMR. Except under exceptional circumstances customers will accept only the products and services that fit their lifestyles, so the process of connecting means knowing more about your customer than current CRM practices make possible. It’s not enough to know just what the customers buy, but also their preferences, aspirations, habits, and interests. You are allowing customers to manage the relationship when you know enough to offer products and services, on an individual basis, that you know to be useful to them personally. You will not only have a reason for the offering; you can also explain the reason to them.

The Kraft Online Community

One company that understands the power of community is Kraft Foods. At www.kraftfoods.com you’ll see things like a place to store recipes, personalized tools to create meal plans to meet calorie requirements, the ability to update personal profiles or to request recipes by e-mail, and even a section called “The Wisdom of Mom,” with shared ideas like these:

Sally—Wilbraham, Massachusetts:

We turn the heat up, get out our picnic blanket and our bathing suits and have a summer picnic in the living room, complete with grilled hot dogs, macaroni salad, and lemonade while the snow falls outside.

Gladine—Bolivar, Pennsylvania:

To make my mac&cheese extra fancy and dress it up a little bit, I put it in a casserole dish and layer Kraft singles over the top. Put it in a warm oven until the singles melt.

Kraft has customers doing the work that used to be done by its promotions department.

In The Myth of Excellence: Why Great Companies Never Try to Be the Best at Everything (Crown Business, 2002), Fred Crawford and Ryan Mathews support this argument for the importance of connecting with customers. They talk of “Consumer Relevancy,” suggesting that the new way for businesses to create a bond with their customers is to reflect fundamental human values such as trust, respect, dignity, and ease in their offerings. Customers, they say, are looking for human values showcased in every product or service the company offers. They want to be treated like human beings and not just a $26.95 transaction. They want respect, honesty, trust, and recognition as individual human beings, not just a 30 percent discount.

These authors head in the right direction, suggesting that through a focus on customer relevancy companies discover the difference that matters to consumers and develop a program for investments that are more productive and that improve financial performance. Their conclusion is that today’s best companies select one of five attributes (price, product, service, experience, or access) on which to dominate the competition, add a second attribute on which to differentiate, and at least meet industry standards on the remaining three.^[16]

We can build on such an approach, yet even it is still too generalized to take us to the level of individual customers—the signal weakness of most CRM initiatives today. Within any company’s family of customers, different customers seek different levels of experience with the company. It’s no longer good enough for a business to base its strategy on the “average” purchasing experience of price, product, service, or access. A successful business strategy must be based on empowering individual customers to allow them to develop the experience with the company on their terms.

Almost forty years ago, management guru Ted Levitt, talking about the purpose of a business being to create and keep a customer, advocated that the modern firm should “view the entire business process as consisting of a tightly integrated effort to discover, create, arouse, and satisfy customers’ needs.” Today, “customers” can best be amassed by offering “singular” service—presenting many relevant offerings to one customer, rather than settling for the subset of prospects who find one offer relevant. That requires creating a dialog with that one girl in the convertible and keeping her happy by meeting her unique needs.

^[16]Fred Crawford and Ryan Mathews, The Myth of Excellence: Why Great Companies Never Try to Be the Best at Everything (New York: Crown Publishing, 2002).