Best of ECT News


Is Mobile CRM a Cost Center or Profit Maker?

This story was originally published on Aug. 21, 2012, and is brought to you today as part of our Best of ECT News series.

Jeff Hasen, Hipcricket‘s CMO, recently had what he called his “10 millionth” bad customer experience with Comcast.

It’s galling enough to be treated poorly by a company when you buy just about all of its services, as Hasen does with Comcast. Worse, though, is when you are a mobile CRM expert, as Hasen is, and can so plainly see how easy it would be for Comcast to lighten some of its customers’ suffering as they work their way painfully through the service system.

We will get to Hasen’s problem with Comcast and the solution he feels the company could so easily deploy. Hasen’s end point, though, is what needs to be emphasized — and not just for Comcast but every company that uses mobile CRM to serve customers, enable sales or facilitate marketing. Mobile CRM can either be a cost center or a way to bring in more profits. It all depends on how strategically a company views the project.

A company that deploys CRM because it “has” to — that is, because consumers expect to be able to reach out to a company via their mobile device, or because their competitors have mobile offerings — is likely to experience mobile CRM as a cost center. In this scenario, mobile CRM is just another investment that has to be made with no direct connection to sales or profits.

No App for That

Hasen wanted to understand a particular charge on his cable bill. So he called the service number and was routed to a call center in the Philippines, he said. The rep he spoke with wasn’t sure of the answer; Hasen demanded to have the call escalated. After threatening to take his business elsewhere, he had the information he needed. But he wouldn’t have had to go through that aggravation, Hasen believed, if Comcast had a service app for such queries.

Such an app could offer chat in real time, he said. He also would be able to forward his bill from his device to the rep with the questionable charge highlighted. Best of all, since fewer people are probably using the mobile app than the contact center, he wouldn’t have to wait long for an answer.

“Any kind of call like this is improved by being quicker and more efficient,” he said.

Costly Compliance

Besides irking their customers, companies that roll out mobile CRM just because it is expected find that kind of compliance to be very costly, Peter Price, founder of the mobile business intelligence company Webalo told CRM Buyer.

“A major corporate will spend millions a year building, maintaining, supporting and managing its mobile presence,” he said. “Identifying what you have to do get a return on investment can be a real challenge.”

When ROI Is Foggy

In some cases, that is. Oftentimes the ROI for a mobile CRM investment is very clear. A mobile sales app for pharma reps, for example, can quickly pay for itself even if the app in question is the extremely expensive, industry-specific Siebel app, now owned by Oracle. Ditto a less costly mobile marketing app: Studies show that mobile consumers are more responsive to ads on their devices — especially if they are tablets — than they are online. Self-service apps with a clear mission — reordering a prescription, for example, or inventory management — also can pay for itself.

Other service apps, though, have a more vague mission, and in these cases mobile CRM can easily fall into the trap of becoming a cost center. Even then, however, Price said, an ROI can be squeezed out — and a mobile CRM project turned into a profit-maker–if approached strategically.

“You don’t have to mobilize the entire CRM system. Just find the pieces that will add value,” Price said. “For some companies, being able to track a package via an app can add value because they realize that those calls are the source of the greatest number of customer inquiries.”

Eliminating that one source of query adds value. Such an app wouldn’t cost that much to develop and maintain either, Price said. “It would just require a simple interface and one or two business processes at the back end.”

Baby Steps

Oftentimes, extending an app to the mobile environment can be done on the back of an existing CRM solution, Dave Evans, CTO of Symphony Teleca, told CRM Buyer. “Some solutions may have a Web component that allows you to optimize their processes to mobile.”

Limited rollouts are a good compromise for a company that doesn’t want to mobilize its entire CRM system, he agreed.

All About the Data

In other cases, he continued, companies might want to deploy a mobile CRM app and not worry about a specific ROI case, because of the wealth of data, especially geo-locational data, they expect to receive from the mobile app.

“On the back end we are seeing growing demand for mobile analytics and analysis of mobile data,” Evans said. Given the way people use their smartphones — to say nothing of the very ubiquity of smartphones and their 24/7 relationship with their owners — companies are discovering new dimensions about their customer base all thanks to mobile.

Once companies get their arms around this data — which is no easy task, Evans admits — there is plenty of opportunity for ROI. “A company wants to be able to influence a customer at the decision-making point, say when she is in a store comparing prices and a system that can do that is worth its weight in gold.”

Mobile CRM: Cost Center or Profit Maker? Part 2

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