New Zealand companies are investing heavily in customer relationship management systems to better retain customers and increase sales to them, though neither aim is being well achieved, according to a new survey.
A poll of top executives of 800 companies, initiated by the Direct Marketing Association (DMA), found 86% of respondents have implemented or are implementing CRM initiatives, with customer retention cited — by 82% of respondents — as the main reason for their investment. But only 51% said this was being achieved.
Of the 75% of respondents who said increasing sales to existing customers was the central reason for their CRM implementation, only 35% said this was being achieved.
The survey, whose respondents comprised marketing managers (43%), IT managers (32%) and chief executives or managing directors (25%), also found that 13% of companies have no intention of investing in CRM because of cost.
The reasons why CRM is not delivering the goods are less clear. One finding of the survey was a sharp difference of opinion between marketing and IT respondents on issues such as customer retention — 55% of marketing respondents said CRM definitely improves it, while only 35% of IT respondents agreed. Common findings in other surveys has been that CRM objectives are often ill-defined or unachievable. Or that the necessary allied cultural and business strategy change has not occurred.
The DMA found respondents largely knew that CRM was more a business strategy than a piece of software or add-on application — that it should be driven from management down — yet there seems to be confusion at senior management level about what CRM is and what a well implemented CRM programme can achieve.
The results of the survey, which was sponsored by Microsoft NZ, CRM software vendor Pivotal and IT services firm Ceritas Digital, have encouraged the DMA to organise a roundtable for chief executives later this month.