Andy's Articles

THE GULF MARKETPLACE IS NOWHERE NEAR READY FOR CRM
IT NEEDS TO UNDERSTAND HOW TO LOOK AFTER ITS VALUED CUSTOMERS FIRST…

Let's face it. There has been more tosh written about customer service, customer relationships and customer loyalty than any other marketing subject in the last few years.

And still it continues. The new buzz word is CRM, standing for Customer Relationship Management.

Every company you read about, hear about or talk to, now reckon they are putting their customers first. Or, so they say…

I can tell you this. From a US, UK and a Gulf perspective - it ain't happening !

Quite simply, they are being seduced by a concept.

Take the hotel industry in the Gulf. Or, more pointedly, in Dubai. From 1996 to the present time, hotels have been springing out of the ground faster than daffodils in Spring. It's been frightening.

And, there is no sign of a slow down at all. Quite the opposite. One estimate I saw recently, suggests that another 5,000 hotel rooms will be available by 2002.

This means one thing. Business will be much harder to come by. It will be a buyers market. Hotels will have to work much harder to stay still. It's already happening now.

Believe me, behind some confident smiles are some very worried individuals…

So, what are they doing about it? The vast majority are reacting with predictable lunacy. They are throwing vast sums of money at new customer recruitment. Keeping the hotel's name visible to as many people as possible in the misguided hope that some of it works…

What about existing customers? Those individuals that have cost a fortune to acquire? "No, it's too much trouble to build a customer database and write to them regularly… …and, we don't know how…"

Let's get real for a minute. The only difference between most of the 5 Star hotels in Dubai, is the way they treat their customers. The most important element of that, is keeping in touch - thanking, rewarding and enticing a return visit.

So why do most General Managers ignore this?

I personally know this to be true. I have worked alongside and had conversations with most of the hotel groups and large properties in Dubai, over the last six and a half years.

It is absolutely staggering to me, I have to say.

It is now an accepted and proven fact in contemporary marketing, that "it is infinitely more profitable to service an existing customer than it is to find a new one".

Tell this to the hotel industry someone. No perhaps not. They'll only ignore you.

They're not the only culprits of course. There are many, many others. Most of you car drivers out there are past customers of a dealership that sold you that car.

How many times has that dealership wrote to you, telling you how important you are to their business and tried to influence you to return to do more business?

Don't worry, I know the answer.

It's a known fact that a dealership can make more money from you in parts and service than he ever can from selling you the car. So why does he forget you the moment you drive off his forecourt?

Because he doesn't understand your value. And, what's more, he'd rather spend 7 times more on getting a new customer than on the one he has already got.

Sheer lunacy in anyone's language.

Wait until one company sees the light and starts to invest in existing customers. Then there will be some fun, believe me…there will be blood on the streets.

The Gulf marketplace is absolutely wide open for effective customer relationship marketing programmes, underpinned by a total commitment by senior management and staff to recognizing and rewarding the best customers.
It is hugely underdeveloped.

But, most companies in the region don't even understand direct marketing. So there's absolutely zero chance of them understanding CRM, which is direct marketing by another name.

So, my advice to the area for while is, forget about CRM. You are nowhere near ready for it. You have more basic and fundamental issues to address first.

In fact, the first thing you must embrace, is the first commandment of contemporary marketing, mentioned earlier…

"It is infinitely more profitable to service an existing customer, than it is to find a new one"

Looking after your customers correctly, is not only a vital element in business in the Gulf these days, but it offers massive business potential for companies of all types and sizes and in all sectors. The reason is simple. Most companies in the area are not doing this at all or, alternatively, are playing at it.

This offers tremendous opportunities for forward thinking companies to be first in any particular sector and reap the fantastic rewards that are waiting to be claimed.

However, to be a trailblazer - a leader - your company first has to recognize the immense value of an existing customer.

Don't be blinkered like the 'so called' professionals in the hotel and automotive sector.

You will need to recognize and act on the very powerful cost justification for focusing your efforts on customer retention, rather than acquisition.

Then, once you have done that, ensure that you are totally committed to creating and developing a strong and profitable relationship with them.

But, by totally committed, I mean culturally and budgetary. To embark on such a programme, will mean a radical change in the way every single member of your company from the Chairman down to the cleaner, thinks, acts and performs.

It represents a total change in emphasis and application.

For a start, your company will have to build a marketing database. Not a mailing list, a meaningful marketing database ( there is a massive difference by the way ).

Don't try and do it yourself. You will almost certainly make a mess of it. The database needs to drive the marketing programme and therefore has to be built and structured in a way that can cope with the intended growth and changes in policy and direction.

Experienced direct marketing professionals are comfortable with these unique dynamics and their advice will be invaluable.

Secondly, and of vital importance, are disciplines for the continual updating and developing of the database. This is even more important in the very transient Gulf marketplace.

This can be done by phone, fax or email, to supplement proven techniques employed in the on-going programme.

After all that is in place and only then, you will be set to embark on the communications strategy. You will have to originate a meaningful and realistic approach. Decide on your objectives and then, once again, call on specialist advice to make it all happen.

But remember, this is classic direct marketing activity. It will need the input of knowledgeable professionals who have experience of such activity. Don't for heaven's sake, use your existing ad agency. They won't know the first place to start.

It's a completely different culture to producing pretty pictures and storytelling copy, let alone banal ads that no one understands, that don't sell and that cost clients a fortune.

To start with, your customer database has to be segmented. Everyone will be different. Your database will not be an amorphous mass of customers. It will be a number of individuals, with different likes, dislikes, requirements and purchasing habits.

Remember, these days the secret of success is marketing on the differences of people, not their similarities.

Accordingly, the messages you send out to people, have to reflect that. Do not talk to everyone, talk to someone. By looking at it like that, you will start to connect to people a lot more.

And, when you connect, you have more chance of influencing, persuading and reassuring them to do more business with you.

But, be aware. Things are moving very quickly out there. Customer service for example, is already old hat. It is now all about customer satisfaction.

Service is what you give to a motor car. Satisfaction is what you must now give to people. Treat them well, reward them, make them feel special and they will treat you well in return, by staying loyal to you.

But, you have to be totally committed. Otherwise your customers will see straight through you.

Be consistent, be genuine and, above all, find out what they want and give it to them. And then say "thank you"

Don't fall into the age-old trap of giving customers what you think they want. If you do, you'll be out of business quicker than you'll believe.

How do we find out what they want, I hear you say. Easy. Ask them. They'll be pleased that you have asked. It is not unusual these days to get over 40% response from a well produced and incentivised questionnaire.

One more thing. If your company has installed one of those appalling machines that answer the telephone instead of a human being, rip it out of the wall NOW and bin it.

Never mind what your dimwitted financial controller tells you, this will not save you money and make your company operationally more effective.

Of course a human being will cost you more. But, in the long run that person will be well worth the additional investment.

Your customers and potential customers do not want to talk to a machine. They do not deserve to talk to a machine. If they have taken the time to call your company, they deserve to talk to a real live human being.

Ensure that they do.

How can you preach customer satisfaction otherwise?

Andy Owen is Managing Director of Andy Owen & Associates, a Strategic Marketing Consultancy, with offices in Birmingham, Dubai, Paris, New York & Los Angeles. He personally visits Dubai every four weeks to work with clients in the area. He can be contacted on 0044 121 778 6640, or by email at andyowen@aol.com en.co.uk