Customer relationship management is touted as a positive means of
serving and empowering the customer. But what other, more insidious
uses could it have? Lindsay Nicolle reports on this growing
market
It is a common belief that almost anyone who deals with
customers secretly believes them to be the most loathsome invention
since the word "service" reluctantly entered the British staff
manual.
Think about it. Most of us are crabby, impatient shoppers. Our
love affair with credit proves we don't like to pay. No wonder many
service staff make it plain they couldn't care less if we had a
nice day or not.
Why on earth, then, would we be interested in fostering a
"customer relationship" with every corporation in town? Because
companies would then cater for our precise, individual needs and
not treat us like one of the herd. Yes, we all know the industry
spiel. But what of the downside?
First, even if we don't want to form a relationship with every
company we come across we've got little choice. That's because we
are all being systematically "CRMed" - customer relationship
managed - thanks to the technology of the same name. Forget the
customer being king, the customer is now an insect wriggling on the
end of a pin, undergoing dissection by every eagle-eyed corporation
keen to refashion their victim into a fat figure on a balance
sheet. The lifestyles of ordinary people in the UK are being
scrutinised today more intently than every neurotic under analysis
in the western hemisphere.
You may eschew shop loyalty cards, pay in cash, and religiously
tick the little box that ring-fences your personal data on every
transaction you make. But it is virtually impossible to prevent
your personal information from leaking out in some shape or form to
those who have an unhealthy interest in your business.
From your school days to your polling card, your postcode to
your passport, there are records, and records - and records of
records - around that you never knew existed. There's a strong
likelihood that one day these will be traded unethically (if they
haven't been already).
The Data Protection Act is only as good as the companies that
stick by it and the people they employ to follow its code of
conduct. For every company you trust not to sell your personal data
to any Tom, Dick or dotcom, there's one that will do so
unwittingly, if not knowingly, leaving their image squeaky
clean.
The upshot of this often permissionless intrusion is that while
companies may be strangers to us on first meeting, it appears we
are increasingly familiar to them.
For customers, that's like having someone viewing your police
file five minutes before you meet them. It may just contain a few
minor misdemeanours, for example, those library books you forgot to
return, the odd bounced cheque because you spent the money on a
last- minute weekend break, or a history of opening and closing
your book club membership just to get the free introductory
offer.
However, it may also contain evidence of more heinous crimes,
such as a tendency to diligently return substandard goods before
the guarantee runs out, a hatred of cash machines, or a tendency to
run your bank account so efficiently that you withdraw big sums as
soon as they arrive and stay just right of the line on bank
charges.
Businesses are quick to deny that these actions will ever be
held against consumers, but if that's the case, where is the value
in knowing them?
The response from industry to this question is so polished that
it would be possible to quote people in dozens of different
positions saying the same thing. The argument runs that the
knowledge of people's less profitable habits is just a by-product
of the main operation, which is to collect personal data that will
enable a company to better understand its customers wants and needs
so that it can offer a better and more personalised service.
Moreover, no one will get hurt in the process. Services will
just be tailored to persuade consumers exhibiting "negative"
behaviour (that which costs the company money) to interact with the
organisation via less expensive means. Consumers will be painlessly
retrained. There is nothing underhand going on, no alternative
agenda. You're just being paranoid.
Tell that to the village inhabitants who recently saw their
local bank close because they weren't considered to be wealthy
enough customers to be worth keeping sweet. The move was proof that
the bank is a business not a nanny service. The only relationship
it's interested in is one where it gets what it wants whatever the
cost.
No company makes a move like that, or adopts a new technology,
unless it holds out the prospect of saving money. CRM technology
will not only save companies money but will generate it too. It can
identify your most profitable customers and highlight those you
wish would go elsewhere.
It's a short hop from this scenario to identifying measures that
penalise or deselect profit-neutral customers. For all the
protestations of CRM fans, the negative application of the
technology from a customer's perspective is bound to happen. If a
company is profit hungry it will use CRM to cut losses.
Banks can be expected to make the first move. Technophobes who
avoid ATMs and withdraw small sums every day over the counter may
find themselves charged extra for their preference. Unprofitable
customers may be just smoked out. Banks just have to raise the bar
on loans, overdraft charges, or the minimum amount to be kept in a
current account and people will look elsewhere for an alternative
service.
The rot has already set in according to Terry Nelson, principal
consultant and CRM strategist for Tanning Technology Europe, a
recently formed e-business consultancy that develops CRM solutions
and architectures for the financial sector.
"At present, high street banks are applying traditional CRM
measurement very strictly and possibly erroneously," he warns.
"They're attempting to form more in-depth relationships with more
profitable customers, overlooking the potential and the needs of
others, for example those who are borderline for mortgage
loans."
He adds, "Banks have a poor track record of treating customers
as customers, or even listening to customers. It takes two to
develop a meaningful relationship and current bank CRM activities
are not doing this."
What can customers do? Refuse to provide any personal data?
Deliberately falsify personal information? Argue over every bit of
junk mail? Frankly, life's too short.
An easier, more conciliatory approach would be to develop a
better r‚sum‚ as a customer while policing misinformation as best
you can - this way at least service staff won't have a reason to
wish you dead.
A paranoid's guide to CRM
- I will be identified as a non-profitable customer and
blacklisted
- Treating people as individuals means making equals of none of
us. A three-tier hierarchy of customer will prevail, with a
corresponding standard of service, as with the airlines:
first-class customers (VIPs), business passengers (trade), and
economy (peasants)
- My personal details will be traded for profit with companies I
know nothing about and that may not be as ethical in their dealings
as they seem
- Knowledge of my lifestyle will reveal my political, religious
and moral beliefs which will be manipulated by skilled
marketeers
- Unscrupulous firms will use my friends and family to learn more
about me, offering incentives for my information. (Witness the
cash-back referral services mushrooming on the Net)
- Firms will learn of less sociable human habits and prey on the
vulnerable. For example, offer easier access to cheap cigarettes or
ways to gamble
- Goods and services won't change at all, just arrive in
personalised packaging, but I shall be lulled into believing that
over time they have changed and pay more for the
privilege.