Last month's link-up between McDonalds and NTT DoMoCo in Japan, which allows diners to pay for their burgers using their mobile phones, is the latest concrete example of how digital is transforming the world of CRM. McDonald's new service attempts to fuel customer loyalty via email offers, discount coupons, mobile phone games, ringtones and wallpapers, as well as targeted mobile advertising. Coke and Pepsi are two more big brands that have jumped on the digital CRM bandwagon - but are these interactive worlds translating into real consumer benefits?
1 Today, digital CRM expectations are lower. About four years ago, many companies launched campaigns thinking they were "a piece of magic software that could immediately double sales", according to OgilvyOne China president Chris Reitermann. Many efforts failed, at least partly because of an over-reliance on technology. Nowadays, companies often dub their CRM drives as ‘sales acceleration' or ‘demand generation' - with the objective of getting deeper customer insights that lead to direct communication.
2 Increased interest is being driven by FMCG companies, while sectors that are known to favour CRM programmes - travel, auto and financial services - are rapidly maturing in Asia. As Reitermann explains, the slowdown in growth amid increasing competition means brands are demanding a stronger understanding and link with their consumers.
3 Slowly but surely, digital CRM has started to shake off its links to email spam, thanks largely to advances in mobile phone technology such as 3G multimedia services, mobile phone cameras, barcode scanning and mobile ticketing. The iCoke platform, for example, asked consumers to send in a membership number found on Coke bottles and were then invited to join iCoke online.
4 The ability to better map consumers' preferences and activities is also key. Example: Johnnie Walker recently released a sexy mobile ‘assistant' download which can help users organise their schedules, read reviews of bars and clubs and even get on guest lists. At the same time, the brand is creating a database of consumer habits.
5 The next wave of CRM technology includes heat-mapping to allow a reader's pupil to be scanned for excitement and engagement while reading an email. Online focus groups such as Ogilvy's Lighthouse prompt consumers for feedback and criticism of online campaigns before they are launched. CRM experts say they are thus becoming more sophisticated in predicting how and where to focus campaigns.
6 Data integrity remains an issue, and spam is still alive and well. Tequila Beijing GM Ross Gearing says: "Two years ago, we saw a real drop-off in people's willingness to give out their mobile phone numbers. If you make a mobile phone number mandatory for a customer survey, the volume of replies goes down".
7 Budgets remain small and programmes are often seen as an add-on. According to Tribal DDB regional president Adam Good, this is having an effect on the talent base, thanks to a paucity of the kind of big-budget campaigns that attract the best talent. Agencies, accordingly, are having to invest in their own training programmes. "It's expensive, but having very local teams will give us an advantage," says Good.
8 Choosing the appropriate technology and content depends largely on the target audience. Mobile phone programmes launched by the likes of McDonald's and Coke skew to the more tech-savvy youth generation. Older audiences are not always excluded, though. CEOs, for example, are believed to respond better to mobile messaging, while the ‘grey' market may prefer email. Geography is also critical; mobile marketing has seen significant growth in China, where broadband PC penetration remains low.
9 Programme length also remains an issue. As quarterly reporting becomes the norm, the pressure for short-term blasts has grown. While digital does offer the ability to accurately track every single marketing dollar spent, it is questionable how much ROI can really accrue from a three-month rather than a three-year plan.
What it means for…
Advertisers
- New CRM techniques should enable advertisers to learn more about their customers and consequently offer them more appropriate products at more appropriate times - a key benefit in Asian markets, where gathering consumer intelligence can still be a tricky business.
- The ability to track ROI is improved, although clients risk becoming fixated with dollars at the expense of creating an empowered brand.
Agencies
- With a lack of talent in the area, agencies will have to focus more on their in house-training of local staff who know their market.
- Creativity is becoming crucial. Clients want more advances in interactivity, while consumers have become jaded with traditional direct marketing techniques.
- Integration must be more than a buzzword. The type of cross-media campaigns rolled out by Coke and Pepsi mean that agencies must be ready to deal with the full spectrum of media.