Gartner: Four CRM trends to watch - and how your firm must respond

With CRM high on the agenda again this year, Gartner has outlined its CRM predictions for 2010 and beyond.

Gartner has forecast that customer relationship management will remain high on the agenda this year, as the analyst outlines its key predictions and advice for the CRM space.

According to the Gartner Executive Programs (EXP) 2010 CIO Agenda survey, attracting and retaining new customers will be the fifth biggest business priority for CIOs in 2010. And as a result, they are keen to explore how CRM technologies and processes can help them meet these goals.

Furthermore, the proliferation of social media tools has created new opportunities for businesses to engage with customers – though this will add another layer of complexity to organisation’s customer strategies.

"For most organisations, the single most logical way to differentiate the business is through great customer experiences, rather than having the lowest cost or most innovative products and services," says Ed Thompson, vice president and distinguished analyst at Gartner. "However, gaining a clear understanding on which specific customer-centric initiatives will prove decisive and merit investment will require coordination across departments."

Gartner has identified four key trends that it believes will emerge from 2010 and beyond and has provided its advice on how businesses should respond.

• With the number of social tools expanding, marketers and customer service functions should focus on the three or four networks that will dominate specific languages. Facebook, for instance, will emerge as the number one social network in all but 25 countries by the end of this year, according to Gartner – but will not be the leader in India, China or Japan. "Facebook membership hit 300 million in September 2009, and is roughly doubling each year," says Thompson. "It is reasonable to assume that it will attain a membership of 600 million (including inactive accounts and a small number of users with multiple accounts) by the end of 2010 based on the trajectory in 2009."

• With CFOs demanding greater marketing accountability, marketers must leverage marketing resource management (MRM) and enterprise marketing management (EMM). Through 2010, marketing budgets will remain flat in more than 90% of companies, despite a return to growth. Furthermore, CFOs are demanding increasing accountability from marketing departments, often exerting unprecedented pressure to link programmes to sales results and ROI. "As a result, marketing organisations will need to automate operational processes and learn how to leverage technology to measure areas previously left unmeasured, enabling them to do more for less and articulate business value," says Kimberly Collins, managing vice president at Gartner. "MRM will become a top priority for marketing organisations, and EMM will take on new meaning as a vehicle for strategic planning, collaboration and measurement."

• While many firms are struggling to make a clear business case for social media, the largest growth in this area will be by firms using social tools to improve customer relationships. Although the hype around any and all social media activities will continue through 2010, companies are struggling to find a business case, including hard metrics and specific business outcomes, using general social activities and generic social applications. Nevertheless, social projects evaluated by Gartner show that those with a clear and direct mutual purpose (benefits for both company and customer) were the ones likely to show measurable results. The analyst believes that by the end of 2010, more than 80% of market growth in social applications will centre around a business use case for improving external customer relationships – rather than improving internal collaboration. Gartner says that the social application vendors that make the transition from general purpose to support for specific business, with use cases and key performance indicators, will see double- or triple-digit growth in 2010.

• Marketers are ramping up their online marketing activity and will enable firms to save significant money as a result of the online channel’s precise attribution metrics. By the end of 2011, more than 90% of Fortune 1000 marketing campaigns will include online marketing, up from 50% in 2009, according to Gartner. Marketers are responding to the expansion of the internet by investing in addressable branding and advertising, and contextual, community and transactional marketing. Gartner predicts that marketers will see a 10-20% savings in marketing communications as a result of precise attribution metrics for campaigns. "Being online gives marketers greater access to response attribution metrics to help determine what is working and what isn't working in a campaign," says Adam Sarner, research director at Gartner. Online marketing will enable faster testing and campaign refinement, and help avoid the continued waste of funding a failed campaign, while engaging in more-thorough campaign testing prior to launch. It will improve the overall success of all marketing objectives. Both speed of analysis and response will be critical to success.