CRM Predictions: Spotting the Critical Connections

At this time of the year, there’s a great clamoring among the business publishing class for predictions. That is partly because prediction stories are considered easy to write, and once they’re done the staff can go celebrate the holidays while their publication continues to deliver content.

However, having written a lot of prediction stories in the past, and having looked at some of those predictions years later, I can tell you that they are not easy to write, and they are an effective way to make yourself look like a buffoon should anyone wish to look up your past prognostications. Even in the CRM space, a relatively contained sector of seemingly methodical evolution and advancement, predictions are a difficult and tricky thing.

Chain of Connections

They bring to mind the television show Connections, which was hosted by James Burke. If that was before your time or it escaped your attention, the show’s premise was to reveal how a sequence of seemingly unrelated events shaped the state of technology (and even society itself).

For example, one episode began with the credit card, pointing out that credit began with the dukes of Burgundy hundreds of years earlier. These dukes used credit to buy armor for their military; in response, the Swiss developed large armies of ill-trained peasants using the pike square formation.

Armies therefore increased in size and could no longer live off the land, so during Napoleon’s time, the need for provisions resulted in canned foods. Even so, some of this food went bad, spurring the development of cooling technologies for food and in 1892 the invention of what we know as the Thermos.

Rocket pioneers adapted these thermal flasks to hold liquid hydrogen and oxygen; the V-2 rocket of World War II used the thermal flask principle, as did the Saturn V rocket that propelled man to the moon. Thus, without the invention of credit, we may have never landed on the moon.

CRM’s Sales Origins

CRM and its associated disciplines and technologies are very much like this. In retrospect, we can see how the connections led us to where we are today.

The success of some salespeople — presumably with either outstanding capabilities for recall or unique data organizational skills — gave them a better command of information about the people they sold to. This led to sales managers discovering that sales best practices were bettered when combined with access to this data and a desire to extend the abilities of these exceptional salespeople to the entire sales force.

This led to the first contact management software, which allowed sales to scale the number of contacts salespeople could manage but created an information gulf about the interactions they had with those contacts. CRM evolved from this to capture these interactions.

At the same time, other customer-facing parts of the organization began to see the utility of this data, and so marketing and support became part of the CRM mix. Sales also saw the value in viewing data generated from marketing and support activities, further increasing the need for data visibility.

Internal Influence

While CRM was at first the domain of large, well-funded companies, its capabilities were so promising that smaller companies began clamoring for a means to gain access to it. In the early 2000s, we saw SaaS-based CRM emerge as a result, removing financial barriers to entry and accelerating cloud computing in general.

The parallel rise of social media saw customers producing a new and rich set of data about themselves and opening a new channel for conversation with the companies they bought from. In response, what was called “social CRM” emerged, only to be subsumed by CRM as social media became an increasingly common means for customers to communicate.

Marketing automation blossomed in response to a need for marketing to keep up with productivity increases in sales, and soon it was being more tightly integrated with CRM. As the need for an advantage in selling has grown, marketing automation increasingly has become a part of sales’ tool set.

That gets us to today, roughly. Would anyone have predicted that the skills of smart salespeople eventually would lead to marketing automation? Probably not. Heck — three years ago, who would have foreseen the disappearance of the term “social CRM” from the conversation about these technologies?

That is why predicting what’s next for CRM is difficult. It can be influenced by a host of factors internal to business, the customer or the technology.

External Events

It’s easy to make predictions about business moves in the coming year. It’s a much harder task to predict the factors that will drive change in CRM.

How will customer attitudes about data change as the Internet of Things becomes a fleshed-out reality? How will companies find competitive advantage from analytics as the tools mature and become widely available? How will CRM vendors pursue the creation of a more complete set of capabilities for their customers, and how will they apply a reality check to them to ensure that they’re a fit for the problems customers face and the directions their businesses are being forced to take?

If you’re a good prognosticator, you’re looking for those external events, those shifts in perception and the new problems people face in sales productivity, customer experience and customer loyalty.

These three dynamics push and pull on one another — what may be good for today’s sales productivity may damage customer experience and ultimately loyalty, and what’s good for loyalty may result in reduced sales productivity.

Getting the balance correct while satisfying all the needs of the buyer, the seller and all the other parties involved in the relationship is easy in a vacuum — but other economic, social and business trends will conspire to throw off the equilibrium.

When you’re trying to predict the future of CRM, pretend you’re the host of Connections, looking at the timeline halfway through an episode. Don’t become fixated on CRM itself — watch for the events taking place in the broader world, because even the most unlikely trend may set in motion a series of developments that transform the CRM landscape.

Spotting the right trend and anticipating the timing of its impact on CRM will pay off in a competitive advantage for those who look keenly into the future.

CRM Buyer columnist Chris Bucholtz is director, content marketing, for CallidusCloud and a speaker, writer and consultant on topics surrounding buyer-seller relationships. He has been a technology journalist for 17 years, focusing on CRM since 2006. When he's not wearing his business and technology geek hat, he's wearing his airplane geek hat; he's written three books on World War II aviation.

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