From Customer Relationship Management to Customer Managed Relationships

By Kevin Meltzer, co-founder of Consology

In today’s web and mobile world, customers are taking control of their relationship with their service providers. The trend began when businesses first started to allow customers to interact with them using Self-Service technologies such as interactive voice response and automatic teller machines and gained momentum with the arrival of the Web. The mobile Web, smart devices and 24/7 connectivity are now rapidly advancing this trend.

Customers now make use of Web-based Self-Service tools, mobile apps and social networking platforms to interact with businesses, at their convenience and on their terms. If businesses ever had any illusions that they were in control of relationships with their customers, this new world is probably shattering them.

No longer do businesses decide how, where and when they will speak to their customer – when they tweet to your business on Twitter at 8pm on a Friday evening, they expect the business to be there and respond. Competition is also greater due to the changing market as your business is not the only business providing product or service information to consumers – with a single social media post, customers can ask others for their insights and help.

Against this backdrop, doesn’t it sound naïve to talk about customer relationship management, when it’s more a case of the customer managing the relationship? For businesses, the implication is that they must begin to think about customer experience at every point of contact as one of their most important competitive advantages.

The customer experience is the sum total of how the customer feels about a business brand, sees the business and what they think about it after interacting with the business across their own electronic, face to face and telephonic channels and touch-points.

It sounds intangible and is complex to measure, but it translates directly into customer satisfaction, customer retention, and new customer sales. Businesses that offer a good customer experience – think Apple, for example – can inspire awe-inspiring amounts of customer loyalty and charge a premium for their products.

The 2011 Customer Experience Impact (CEI) Report by RightNow (acquired by Oracle in March 2012) and conducted by Harris Interactive shows that 86% of consumers will pay more for a better customer experience. What’s more, 89% began doing business with a supplier’s competitor after they had a poor customer experience.

What this all means is that we have moved from a world where businesses sell to the customer, to one where the customer decides whether to buy from a business based on customer experience and often social feedback or recommendations.

To compete in this new customer world, a business must provide a consistent and transparent customer experience at every touch-point and have systems and processes that are designed to underpin this experience. The right Self-Service channels – with well-designed interfaces, functionality and design; analytics tools that help businesses understand the customer; and good, clean data are just the start. Competing in this world means that businesses need to think about their customers in a new way and empower them with the products and services to allow them to manage their relationship with their chosen service providers.

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From Customer Relationship Management to Customer Managed Relationships