AGENCIES OFFER THEIR TAKE ON THE STRATEGY
by Barb Baylor Anderson, Contributing Editor
Editor's Note: Customer relationship management, or CRM, is garnering more attention from ag companies and their agencies, as vying for customers' dollars becomes more competitive. We asked three agency representatives to share their thoughts on CRM, Tina Vilter McDonald, vice president-account group director of Charleston|Orwig, Hartland, Wis.; Becky Nelson, group supervisor, relationship marketing, Bader-Rutter & Associates, Inc., Brookfield, Wis.; and Lorie R. North, vice president, McCormick Company, Kansas City, Mo.
How do you define CRM and its use in agriculture?
McDonald: From an agency perspective, we define CRM as helping our clients discover and meet their customers' needs profitably. We advise our clients to develop two-way communications with customers to build a meaningful understanding of what their customers want. After all, customers do not develop a "relationship" with just a product or a piece of mail. If they have a relationship at all, it is with someone who understands their wants and desires beyond just their buying needs.
Many companies maintain databases containing customer profiles. If you know that a customer always buys the same brand, you can communicate with him or her about the brand's newest enhancement and what it means to them, or send helpful tips on how to maximize their goals based on the brand's features and benefits. The bottom line is, you're adding value that is pertinent to the customer's needs.
Nelson: In the simplest terms, CRM can be defined as developing relationships with your customers and then managing them at every touch point, based on their unique wants and needs. Managing this total relationship must be seamless to the customer, no matter which function of an organization they're working with at any given time. CRM in agriculture, as any industry, requires an established process and continuous improvement.
North: It's almost easier to define what CRM is not. It is not just direct mail or customized ink jetting. It is not an e-mail or advertising using selective binding. It goes beyond traditional sales communications and training. It's a total program encompassing everything a company demonstrates and communicates to an individual customer.
CRM is a holistic approach surveying all touch points a company makes with individual customers. It's beyond target marketing because it addresses individuals and their specific needs. CRM has a fantastic fit with agriculture because of the concentration of agricultural production and the strength of the many sales professionals involved.
How has CRM as a strategy changed the last few years?
McDonald: The days of broad-brush, one-size-fits-all strategies are long over. CRM has to be highly individualized because we recognize agricultural producers have very individualized needs. A customer strategy that works with a producer on the West Coast may not necessarily work with a producer on the East Coast or a producer in the Midwest. Not only that, you may need separate approaches for varying levels of relationships.
Nelson: CRM strategies are still being studied and evaluated at many companies. CRM, or one-to-one marketing, has been around for several years. Some companies embraced it, made progress, and continue to refine and improve the process. Others have only just begun talking about it.
North: I believe agriculture has led the way for integrated marketing communications programs, and agriculture will lead applications of CRM. Thinking about touch points with customers via CRM is a more sophisticated approach. I see our clients using specific knowledge about individual customers to offer information and tools that customers need to do a better job in their operations. It's far more than convincing a customer to continue buying a product or service.
What is the value in focusing on CRM as a strategy? How does it tie in with PR/advertising strategies?
McDonald: To put it simply, CRM just makes good business sense. Producers have many more choices than ever before, whether you're selling tractors, feed, seed or animal health products. Now they have the Internet, allowing them to comparison shop from the comfort of their farm office 24 hours a day, seven days a week. Customer loyalty is a tenuous thing as people seek out the best value. In this arena, it's even more important to build sustained relationships by offering relevant added value.
From the agency perspective, we're seeing a natural tie-in with PR and advertising strategies. We're all familiar with the old adage that it's more cost-effective to maintain the customers you have than to prospect new ones. More and more of our clients are asking for a maintenance campaign targeted at existing customers. Often times, the campaign is designed to help a company's sales force enhance its relationship with long-time customers.
Nelson: CRM can reinforce customer satisfaction and loyalty where it already exists and enhance customer relationships. The product choices available to producers are wide. And with competitive pressures getting stronger every year, maintaining good customer relationships will be increasingly important to ag manufacturers.
If a CRM strategy is to be successful, the key is to have a solid system for the exchange of information between company and customer. That link will be required in all communication mediums, be it advertising, PR, direct mail, personal visits from the sales force or inbound calls to a customer support center.
North: Even though marketers may approach a market through integrated communications, CRM brings even higher value because companies look at customers holistically, defining what is important to the success of their operation.
On the other hand, it's still important to create awareness around products or services through traditional marketing approaches such as advertising or PR. To gain the full advantage, these programs should be defined within a broader CRM strategy.
How do you advise clients in developing CRM strategies?
McDonald: We help our clients determine the lifetime value of their audiences, whether that's a distribution channel or end-user. Then you can move on to strategy and tactics. We take a hands-on approach by visiting producers and key influencers to find out first-hand what they want. In order to add relevant value to product and service offerings, we ask, face-to-face, the people who have the answers. Granted, we live in a highly technological world, but so far no one has developed a workable substitute for getting out and interacting with our audiences.
Nelson: We have a thorough planning process and system to help our clients develop any and all communications based on their business and marketing strategies. If our clients have determined that CRM is necessary to achieve their objectives, we would approach the development of CRM strategies through this same process. That involves gathering pertinent business information, market planning, communications planning and measurement.
North: It begins with an assessment of their total marketing and sales approach. Then, we look at what they know about their customers and how intimately the sales force works with customers. With these resources defined, we look for opportunities to make the greatest positive impact on their business. Bottom line for clients is moving the product or services. You can spend a tremendous amount of money using new printing and electronic technologies to target individuals, but these efforts must provide a return on the investment.
What role will CRM play in the future of agriculture?
McDonald: I think it's safe to assume that CRM will play an even greater role in the future. Logically, producers will expect even more individualized attention as their numbers diminish because they represent an even larger lifetime value to marketers. The good news is that our ability to develop reasonable CRM strategies and tactics is increasing because of our sophisticated system. We think this is a great time to be serving the agriculture industry because the opportunity to build lasting and profitable relationships has never been greater.
Nelson: As the consolidation of ag product and service providers continues, vying for the same customers will become more competitive. Satisfaction with a product will always be key to what makes a producer loyal to a marketer. Extra customer care could be just the touch to prevent brand switching or persuade that customer to buy more.
North: At McCormick, we believe CRM strategies will play an increasing role as we integrate the food chain. As communication technologies advance, we'll have more effective and efficient means to correspond with customers as they become more sophisticated and produce more complex products. Tying together information, education and product benefits in the appropriate context for each producer will help them create more personal success. When producers are successful, we are successful. AM
Barb Baylor Anderson is a freelance writer from Edwardsville, Ill., who covers a wide variety of ag issues.