Insight

A first of its kind report commissioned by the Direct Marketing Association, Microsoft New Zealand, Ceritas Digital and Pivotal Corporation provides an in-depth look at the state of the customer relationship management (CRM) industry in New Zealand.
Key findings from the report suggest that businesses are not maximising the advantages available from best practice CRM. gap analysis between uptake of CRM and subsequent effectiveness shows high disparities.
For example, of the 262 managers who responded to the survey, 82 percent said they had implemented CRM strategy to retain customers, but only 51 percent believed the process was fully delivering on its promise. Others felt there was plenty of room for improvement.
Similarly, when it came to improved sales and marketing efficiency (a key goal for 79 percent of managers surveyed) only 41 percent of managers believed their CRM strategy was being fulfilled – gap of 38 percent.
Other highly ranked priorities for implementing CRM included belief that the use of CRM could: increase sales to existing customers (75 percent, 40 percent gap in success rate), increase revenue (71 percent, 32 percent gap in success rate) and to increase ability to identify high value customers (69 percent, 19 percent gap in success rate).
There’s little doubt about the penetration of CRM into the mainstream of business thinking however. Eighty- six percent of respondees said their companies and organisations were either currently investing in CRM strategy, or were considering implementing CRM in the future. For the 13 percent not investing, the high investment cost was key factor.
There were also disparities in the view of overall effectiveness within different areas of implementation between the 43 percent of respondees who were marketing managers, the 32 percent who were IT managers and the remaining 25 percent comprising mix of sales managers, ceos, MDs and business managers. IT respondents were more satisfied with the analytical features of the results of their CRM strategy than were their peers in other departments. By contrast, IT managers were less satisfied with CRM’s effectiveness in decreasing sales costs to existing customers. The finding suggests lack of cohesion in expectations between IT departments and sales departments when implementing CRM strategy.
The survey also shows up high level of confusion in the market place about what exactly constitutes CRM and what benefits it might provide. Respondents generally agreed that as management strategy it needed to be endorsed and supported by top management including the ceo and executive team.
The survey was prepared by Eklektik and the participants were drawn from combination of databases provided by Microsoft, Pivotal and the DMA.