How CRM Software Can Help Hotels Through Travel Downturn

A few months ago, I wrote about some B&B's that were using CRM software to compete head to head with large hotel chains. With businesses experiencing unprecedented travel budget cutbacks and consumers thinking twice about their vacation plans, even the most successful hotels are thinking about how they can get through 2009.

Hoteliers who can leverage the right CRM software with the right associate training can help their companies survive a recession. That's what InterContinental Hotel Group plans to do. Tom Seddon, the Chief Marketing Officer for the company behind top brands like Holiday Inn and Crowne Plaza, told BrandWeek that his company is banking on help from CRM solutions to grow business.

Hotel operators like Holiday Inn can use CRM software to achieve some important goals, such as:

Building Loyalty. Competition among hotels often keeps rates close for similar properties in a market. By using CRM software to run an effective loyalty rewards program, hoteliers can win more repeat business -- even beating out less expensive competitors.

Recovering Lost Business. Reporting on specific feedback can also win customers back after a hotel stay that didn't meet their needs.

Managing Inventory. By reaching out to regular customers using CRM tools and direct e-mail, hotel managers can minimize the number of unsold rooms on any given night.

Reducing Marketing Expenses. CRM systems can analyze the effectiveness of regular advertising and special promotions. Calculating ROI on a regular basis helps marketers like Seddon eliminate poor performing ads or campaigns.

Hotels may not be able to change the state of the economy, but they can help prospective guests change their minds about heading out on the road this year.

What happens when CRM software hits every mobile device in the world?

That's the question CRM software vendors and buyers are asking after SAP's announcement of a major partnership with Sybase. By teaming up, SAP hopes that it can use Sybase's platform tools to make its CRM systems accessible from any kind of mobile device, from wireless smartphones to dedicated hardware tools.

Building CRM software that works on multiple platforms addresses many of the CIO community's biggest concerns about lock-in. With "consumerization" of hardware choices driving a mix of products in the workplace, partnerships like SAP-Sybase can result in CRM systems ready for universal adoption within client companies. Instead of arguing about how to deploy CRM systems on multiple hardware and software platforms, team leaders can collaborate on developing the kind of training culture required to make CRM implementation a real success.

As more vendors ship CRM systems with multiple interface options, client companies have already homed in on specific tools that let them serve customers more effectively. Many customers already clamor for mobile applications that tie directly into companies' CRM databases, such as trip planners, alert notifications, and mobile banking tools. Enabling customer service professionals to use mobile CRM tools will up the ante for companies who have not yet fully discovered how to leverage CRM into long term profits.

Eight Building Blocks for Success of CRM Software Still No Clue to Its Future

In 2001, Gartner analysts John Radcliffe, Jennifer Kirby, and Ed Thompson published "The Eight Building Blocks of CRM." This white paper helped IT leaders understand the impact of customer relationship management in the workplace, while providing a consistent structure by which purchasers could evaluate CRM applications. (Gartner's isn't the only checklist, either.)

In the years since, even Gartner has admitted that the world of CRM has changed. The document itself now contains a disclaimer that it "may not reflect current conditions." For many CIOs, the building blocks remain as important as ever, even though the deployment of CRM systems has largely shifted to the web.

Those eight fundamental "building blocks" remain:

• Vision. Effective CRM software requires support from the boardroom to the basement.
• Strategy. CRM software should not be a destination in itself; it should support broader goals.
• Customer Experience. The customer should drive the tools, not the other way around.
• Organizational Collaboration. CRM should bring departments together, not serve as a wedge between them.
• Process. When used effectively, CRM systems streamline and codify the things that make your organization special.
• Information. The more you know, the better you can compete through service.
• Technology. Customer demands should drive technology acquisitions.
• Metrics. CRM systems should provide clear results while helping other teams track their own objectives.

Nearly ten years after the creation of the eight building blocks, Gartner invited some of the top leaders from CRM software vendors to discuss how their products and services live up to the vision of an ideal CRM system. As Stuart Lauchlan from MyCustomer.com discovered, the vendors could only "agree to disagree."

• Panelists agreed that only about 20-30% of their clients actively measure the ROI from CRM software implementations. They couldn't agree on why large companies can't or won't measure their success.
• Panelists disagreed over the most challenging of the eight building blocks to accomplish. Data, customer experience, and processes came up in conversation as consistent challenges for organizations.
• Roughly half of CRM software will be web-based by 2020, according to panelists. However, the evolution of technology will erase the distinction between "desktop" and "cloud," making the question irrelevant.

Lauchlan provides more coverage of the CRM software discussion, along with Gartner's own insight into CRM challenges over the next decade.

CRM Software #2 Priority for Top CIOs in 2009

That's according to a recent Gartner survey of over 1,500 Chief Information Officers at the very end of 2008. The #1 priority on their collective list is Business Intelligence software. While some folks would argue that CRM software is a subset of BI, it sounds like the survey respondents make the distinction between the overall strategic components of BI tools and the specific sales and service elements inherent in CRM.

Servers, hardware, and infrastructure items all found homes farther down on the priority list, confirming a few of the running themes of our CRM software blog over the past few months:

• Faced with stagnating revenues, company leaders find it easier to invest in hosted CRM software than in fixed hardware.
• It's easy to trace the ROI on CRM software and BI projects, making them less risky for CIOs to approve.
• With the stalled-out launch of Windows Vista and the pending arrival of Windows 7, many CIOs are happy to sit out a year of hardware upgrades, especially with such a wide selection of platform-agnostic CRM applications.

Reviewing the list of the same CIOs' most pressing business priorities, it's easy to see why so many survey respondents are ready to write checks for stronger Business Intelligence and Customer Relationship Management tools. "Business process improvement" topped the priority list, along with "reducing enterprise costs." Shifts to seat-licensed software tools can certainly address both of those needs. Other top priorities include:

• Attracting and retaining new customers
• Targeting customers more effectively
• Expanding current customer relationships
• Expanding into new markets

Many CRM software implementation teams hope that such high priorities for their specialty will lead to renewed training and development for previously resistant sales and service professionals.

GMail Outage Raises Concerns About Hosted CRM Backups

CRM software experts have expressed their concerns about hosted CRM applications for the past few years. Even as modern web scripting makes hosted apps more desktop-like, their issues are with the challenges that CRM software vendors face when choosing an interoperability strategy.

From a programming point of view, some vendors prefer not to spend time on a feature that makes it easy for users to export data to a competitor's service. And for marketers and sales professionals, even hinting at the possibility of export functionality seems to feel wrong -- like you're bringing up the possibility of a failed implementation right from the start.

It's one thing to debate this issue in the wake of the Entellium fiasco. However, the need to ensure backups of both systems and data emerged recently when Google's GMail service experienced a four-hour outage. Business customers, who pay fees for additional features, were incensed. And critics of software as a service wondered aloud whether any provider could offer truly error-free service.

In my experience, it's better to think about when a vendor will experience an unexpected system failure -- not "if." Thinking this way puts an outage into perspective:

• What's your threshold for failure?
• How long could you run your business without a hosted CRM tool?
• How quickly could you migrate to a backup solution?
• How much extra are you willing to pay for a feature that you may never need?

While some vendors have made export functionality part of their sales pitch, others leave it up to you to ferret out the information. Based on advice from industry experts, here are some tips that can help you get over your fear of leaving data on the cloud.

• Learn how your team can backup and restore data from your hosted CRM software on a regular basis. A legitimate vendor will have some way to do this, even if it lacks official documentation.
• Ask for specific details about how a prospective hosted CRM vendor operates their servers, especially their backup systems.
• Make the right decision for the kind of business you operate. A mom-and-pop marketing agency does not always need the kind of redundancy as a bank.

Following these steps can reduce your stress level while opening up real opportunities to save money and to improve customer service.

Irish Police Detain CRM Software's Public Enemy #1

Did you hear that Irish police have finally nabbed their island's worst driver? Prawo Jadzy showed up in the database over fifty times, with a different address listed under each record. As it turns out, "Prawo Jadzy" means "Driver's License" in Polish. Irish traffic cops, when stopping Polish tourists and guest workers for minor traffic infractions, simply copied the phrase as if it were a name. An honest mistake, repeated a few dozen times, gave police administrators the impression that a manic driver with a history of giving false addresses was wreaking havoc throughout the country.

How does this story relate to your CRM implementation?

Think about how your customer service agents and your sales professionals enter data for new customers into your CRM system. When confronted with incomplete data, are your users entering jibberish? More likely, are they entering placeholder text, like "none@none.com" for an e-mail address? Are they entering their own zip codes or your company's zip codes if a customer doesn't provide that information? All of these common CRM software workarounds may help your team members get past "required fields" screens, but they could be wrecking your data.

CRM software developers encourage system administrators to take two points of view when tackling the problem of bad data:

First, don't assume you won't need a certain piece of data at some point down the road. Therefore, you should make sure that team members collect accurate data now, especially if you have the opportunity to clean up data during repeat visits with a customer.

Second, assume that as much as 25% of your data may be flawed. Under that assumption, you may think differently about using systems that require unique names or e-mail addresses as identifiers. You may also consider filtering out a few "hot zips" that employees are likely to substitute.

This way, you can still leverage the power of the accurate data in your CRM system -- without wondering why Prawo Jadzy places dozens of orders per month.

Cash-Strapped Sales Managers Embrace CRM Applications

Across the United States, sales managers are trying to figure out how to close more deals with fewer resources. Lavish corporate expense accounts are suddenly passe. You can't fly on the company jet anymore, especially if you're taking any federal bailout money. And you'd better not let anybody see you trying to entertain your clients at a company sponsored sporting event.

In this environment, smart sales managers have decided to get even smarter by deploying CRM systems. Yes, even those sales managers who have resisted CRM software implementations for the past few years have rethought their positions. The monthly seat license fee for a hosted CRM application is a fraction of what it used to cost to foot the bill for a three-martini lunch with a customer.

For IT managers and other implementation leaders, this sudden embrace of CRM applications comes at a cost. The pressure's on to deliver solid improvements in sales and service metrics, just on a shorter time table than typical installations. In-house users still require training, and still present the kind of resistance that CRM developers hope to overcome.

New CRM software modules have been designed with today's power users in mind. Chat systems that integrate with public websites can be used to manage more incoming communications at once than current call centers can handle. Stronger e-mail tools can filter inbound messages into quality leads and follow-ups. And task lists tied more tightly into customer time tables help sales professionals understand who to call, when, and why.

The market's only getting tighter, and it's up to company leaders to get behind CRM software -- not just look to it as the Hail Mary pass that can preserve this quarter's profit margin.