Commentary & Analysis
VDP and CRM: Two Struggling Business Solutions That Could Actually Help Each Other
By Mike Wesner What is one-
By WhatTheyThink Staff
Published: April 27, 2005
By Mike Wesner What is one-to-one marketing anyway? The completion of CRM efforts of data mining and analysis increase sales activity. April 27, 2005 -- I continue to observe from the sidelines the development of Customer Relationship Management (CRM) techniques in the marketing industry. I first read about the concept about the same time I was learning about an emerging printing technology called variable data printing. From the beginning I thought that it was a perfect fit--two ideas that clearly complemented the other. What is one-to-one marketing anyway? The completion of CRM efforts of data mining and analysis increase sales activity. A buzz has surrounded Variable Data Printing (VDP) and CRM, yet they have experienced similar struggles in the market. Both are at the same stage in their respective disciplines: everyone knows they represent a large part of the future of marketing, yet both have failed to harvest the predicted successes. Unfulfilled Promises VDP and CRM represent a large part of the future of marketing, yet both philosophies have struggled to harvest the predicted successes. Companies have invested large amounts of money and time building CRM systems and initiatives. Like variable imaging, CRM has promised a highly valuable business outcome. Many of the promises made by these technology-centered solutions have gone largely unfilled. Researchers such as Gartner Group and Meta Group have reported failure rates of 55-70 percent for CRM implementation. Gartner says lack of a coherent business strategy is the reason for the high failure rate. Ironically, this is what I feel is the number one factor that also affects one-to-one marketing success for many of my customers. Reasons and Excuses Many industry analysts have their list of reasons why CRM has not yet been fully successful. Some of these lists include issues such as 1) focusing on technology more than the business strategy, 2) trying to implement too big of a solution in the beginning and 3) Failing to re-engineer business processes. But I'm convinced that the biggest hurdle in seeing results from CRM programs is that companies focus too much on analysis and forget to execute. Industry colleague Vaughn Fisher of Daniels Marketing Support Services in Asheville, NC, once shared with me that creating a direct response campaign with one-to-one marketing integration was the execution arm of CRM. "Until you pull the trigger and do something like a direct mail campaign that uses data, then all you really have is activity." The Missing Component Most organizations are struggling with actually putting CRM to work for them. While CRM strategies continue to dominate strategic discussions in many marketing organizations, most organizations are struggling with actually putting CRM to work for them. Many experts have divided CRM strategies into two categories--operational and analytical. Operational CRM includes the day-to-day data mining at various customer "touch points," while analytical CRM looks at the data collected and produces marketing intelligence from it. What's usually missing is a clear plan of what to do with the data. That points to the third component--and most important category--of CRM: execution. While one-to-one marketing is only one of several ways to execute effective communications from data that's collected and analyzed, it certainly is consistent with adding relevance to the customer relationship. More importantly, it's a tipping point that lets the organization move away from "analysis paralysis" and make something good happen. Are CRM and VDP Looking for Each Other? Can variable data imaging be the savior for the CRM industry? The execution side of CRM is a big part of the equation that is missing for many marketing leaders. And one-to-one marketing projects are the execution of months of hard work that go into any CRM initiative. Is CRM the missing opportunity that variable data imagers have needed? I think this has been the last case for the last 5 years. After all, there are no direct response project opportunities until data is collected, mined, and analyzed. What could be the results if both ideas joined together? They are natural front-end and back-end parts of promising business generation solutions. Join me in my evangelistic efforts to get these two solutions acquainted. The opportunities are exciting. CRM meet VDP...