Grasping For the Last Straw
In recent months, I have seen so many articles and posts written where a CRM platform is deemed critical to the success of a company. Sometimes it even receives the #1 priority for execution.
Show me one case study where a sub par product maintained profitable and substantial growth due to a CRM solution. Conversely, show me one case study where a solid product failed due to not having the best CRM solution.
Every organization, everywhere, wants the silver bullet. They hear pitches from providers all day promising to save the world. "If you only knew your customer better, and understood the actions they were taking, growth is limitless". Notice is the image above, product is not listed. You will likely not find it in any CRM solution pitch. Why? Because they only want to help you with the distribution of your message. That's great that they want to stay in their swimlane, but at the same time, it showcases that they don't care about your product. They care about their paycheck.
Let's take a walk down memory lane for a moment. And yes, this analogy has some holes in it but I am certain you will get my point. In 2004, Blockbuster Video was at its peak with 9,000 global stores with $5.9B in revenue. We all know they saw risk in the model so, in search of the silver bullet, they brought in Acxiom CRM to save the day. Acxiom launched their solution with Blockbuster in May of 2003. Oh, the success. 2003 and 2004 were the best years for Blockbuster. An HBR case study has been born.
In 2005, revenue began declining. By 2010, revenue was down 50% from its peak year. What happened to my silver bullet? I know every customer interaction and am able to drop the right message at the right time.
Meanwhile, on the other side of town, a small company called Netflix that started operations in 1997, decided to look at product instead of CRM. In 2000, they built a homegrown CRM that simply pushed video recommendations while building out a new product and distribution model. By 2010, Netflix had equal revenue to Blockbuster. Another HBR case study. And through this, we all know that Netflix had their share of CRM issues. But, my point is, CRM was not the primary issue nor was it the solution.
Before you stake your career on SalesForce, take a hard look at everything upstream from CRM. Has your value proposition been validated lately? Have you actually run real consumer research in the last year to understand your product gaps for today and into the future? Have you sat down with Marketing and Distribution to ensure they understand the KPIs and have shared objectives? Is your distribution model built for yesterday? CRM can't fix one iota of this. If you ask AI a loaded question, it will find you the answer you are looking for. Do the hard work. Do the right work.
- Understand your brand health and identify root causes
- Validate and/or enhance your product value proposition for prospects and current customers
- Build and test messaging for the enhanced value proposition and ensure distribution is a critical feedback provider
- Evaluate your distribution as it relates to your customer expectations
- Build a go-to-market plan that addresses the entire funnel from awareness through win back
- Identify and install KPIs for profitable and sustainable growth
- Then, and only then, do you look for a CRM provider that can bring all of this to market
All that said, I do believe CRM is a critical component to your ecosystem. But it is one component and as much as you want it to, it will not solve all of your problems and accelerate your growth. If you are a Founder or CEO that believes your company growth potential is far in excess of what is showing up on your P&L and not sure where to start, shoot me a note. I believe we can help.