Month: December 2011

Loyalty Programs : Do they really work?

Do loyalty programs really work? What can be done to make them work? An article by CRMIT’s Senior Director Naga Chokkanathan:

Loyalty management is a big CRM topic. Every company wants their customers to remain loyal and give continuous business and share of their wallet. They introduce schemes like loyalty cards, points, gifts etc., to attract them.

But in reality, most of these schemes don’t work. I would have registered for at least 20+ loyalty programs and got my fancy cards. But I can’t carry all of them wherever I go, most of the times I keep that card in some book shelf and forget all about that, It doesn’t make me return to the same establishment again, unless and until the benefits are very good and real.

When I say “Benefits”, I don’t really mean cash back, discounts etc., they are important motivators, but for a loyalty program to succeed, the company has to think of something unique and a real value add.

For example, we buy our monthly groceries and other goods from a super market. Last year, they gave me a loyalty card and told me that I will get 1 point for every 200 rupees spent on that shop, and later I can convert those points to gifts.

I did a mental math, my reward is, 1 rupee for every 200 rupees. Means 0.5%, Boy, this scheme is junk, I don’t want silly 0.5% discount for my purchases, forget it!

But guess what, those store people were smart. They recorded my mobile number, and tied it to my Loyalty card. Every time I bought anything from them, they asked for my loyalty card, when I said “I don’t have it with me now”, they asked my mobile number, and added loyalty points to me, even without the card.

Yesterday, I got a mail from them, which gave a nice pie chart with this snapshot:

Your Purchases last year:

  • 38% Fruits and Vegetables
  • 22% Pulses and cooking oil
  • 16% Dairy Products
  • 8% Snacks
  • 16% Others

Wow, I never knew this. When I clicked on the pie chart, it gave me details on my purchases every month and how they changed over the 12 months period. Amazing insight on my spending habits, which I can’t get anywhere else!

Now, I am motivated to carry their loyalty card and produce it for any purchase, I know I am going to get some useful data out of this, in addition to that 0.5% discount, I will buy more and more from them because others don’t give me this value add.

Moral of the story? If Loyalty is a one way street (I want people to buy more from me), it is never going to work. Any Loyalty program will work only if there are visible benefits to the customers too.


Communication is a constant problem for any company. Even if you are proactive and send the right message at the right time, what is the assurance that people will actually read it? There are many problems that get created because customers just miss to read important messages.

We can’t blame them too, they are suffering from information overload (like all of us) and there is every possibility that they will miss your messages, especially sales messages 😉

Hence, the trick is, to use visualization to a great extend. Instead of a long text (Which can always come later), use a picture or two to attract the attention of customers and then give them your message, This simple trick improves the hit rate to a great extend.

For example, this is the image used by ICICI Bank (from India) to inform its customers about their extended hours option, Beautiful illustration which anybody will understand, and makes an immediate impact, isn’t it?

What can we do to visualize your marketing / sales / service messages? Any other tricks you can share?

Socially skyward…

Whenever one travels by a flight, the primary concern is his/her co-passenger, mainly because one doesn’t have an option to change their seats even if the flight has vacant seats or it doesn’t have frequent stops like other means of transport. This unknown passenger lands up as a point of conversation across chat rooms or as a status on social networking platforms. One could have a hilarious experience or a disastrous one. But going forward, one airline is going to make that a difference –‘Social seating’ it involves choosing your seat based on the individual’s interest, hobbies, profession etc. This service is to be introduced early next year by the Royal Dutch airline which has its services to across 135 countries across the world. This is probably high flying Social CRM in the skies. KLM has been running its airlines close to a century now and is one of the oldest airlines in the world. It tied up with Air-France in 2004 for a strategic partnership but both run as independent airlines.

This seating based on Social network platforms isn’t much of a surprise as Malaysian airways had introduced its seating facility way back in March, wherein it allows users to see where their Facebook friends are sitting on a given flight and even Virgin Atlantic is coming up with some kind of a similar programme. KLM intends to get users (passengers) visibility to a limited section of social networking sites, be it Facebook or LinkedIn. The section that is visible is the hobbies, interests, profession etc. which enables passengers to select their co-passenger.

However, this is optional and not mandatory as most of the business travelers / others may want to get rest during their flight. But what is interesting from Social perspective is the fact that flight journeys are only going to get more socializing. This could lead to a host of networking opportunities and could lead to synergy business deals. The other interesting fact is one can get to actually choose their fellow passenger and know whom they are going to travel with for that particular span of time. From an airline perspective, their in-flight entertainment expenses come down drastically as this is purely a choice that begins with the customer and ends with the customer.

There are some concerns with regards to choosing a passenger based on looks and it could turn out being more like a high flying date and an unpleasant one. But that is definitely up to the passenger as each of them would have to accept if they like to be seated next to the other. It is interesting to see how the airline industry has cashed upon social networking sites and building their CRM using the social media platform.

An important thing to keep in mind is making sure one never fakes up a hobby or interest if there isn’t one, as one could get a co-passenger who would want to be seated next to you. This feature ensures that one is really socially sociable. It however makes travel easier for us as we are in the process of CRM by the nature of work we do, so it really doesn’t matter who the person is or what he does.

– Sai Ratnakar Bezawada

Picture Courtesy :

(Simple) Social CRM

Social Customer Relationship Management (#SocialCRM or #SCRM in short) is usually assumed to be a very complex thing, requiring new tools and techniques. But in reality, what you need is just a different way of looking at your customer relationships. Of course, tools help you get there and with quality, but they are secondary, really.

For example, when I am writing this blog article, I use the simplest (and the best-est if you would excuse the cliche) software called “Notepad”, I could have used Microsoft Word, or any other sophisticated word processing programs available out there, but that doesn’t matter, as long as I know what I am writing about, and have the interest to sit down and write it, the tool becomes secondary, I may write my next blog article in my phone’s text editor, or in a piece of paper, till I am ready to present it to others, I need not worry about the format, beautification etc.,

Same logic applies for Social CRM too, if you wait till you have the best tool that fits your expectations, probably you will end-up waiting forever. Instead, focus on understanding these basic things:

  • Who is your customer?
  • How “Social” they are?
  • Where they hang out in Social media?
  • What they typically talk about?
  • What we want to listen to?
  • How we want to respond?
  • Why we want to respond?
  • How do we balance between genuine social conversation Vs intrusion on their privacy?
  • What we want to achieve by all these?
There may be more such questions, but the point is, answering these is more important than buying the right Social CRM tool. You may use the simplest tools and create a great impact as long as the vision is clear and the execution is honest.
One small (live) example. Today I posted this in Twitter:

OnlineStoreX and OnlineStoreY increased the minimum purchase limit to Rs 200/- if you want free shipping. Hmm, Expected, But still…..

As a consumer, I am upset that Online Stores X and Y decided to increase their minimum purchase limit, for free shipping, as I don’t really want to pay for shipping of books. Now I am forced to buy for Rs 200/- (instead of the usual Rs 100/-) to save shipping cost. Not a serious problem for me, but still I don’t like it and I tweeted about it.

After couple of hours, I got a reply from OnlineStoreZ (A competitor to OnlineStores X and Y):

Hello, OnlineStoreZ offers free shipping, without any minimum purchase limit. Try

Very simple, I was motivated to click the given link, because it really addressed my issue. Great!

Now, when we try to guess what could have happened behind the screens, we understand how simple and brilliant this idea is:

  • Listen to what people are talking about us and our competitors in Social Media
  • Wherever we make a difference, respond with our offerings
  • No need to talk bad about our competitors, just say why you are different, and how you solve their problem
You don’t need a sophisticated Social CRM tool for this, All you need is a Twitter search, a Google blog / news search and an RSS reader. It can be a great start and you can start listening / responding.
Of course, this is not scalable, soon you will have tons of messages to respond to, at that time you can think of a sophisticated tool, no need to wait for that to get started.
#SCRM may also mean, Simple CRM!
Naga Chokkanathan

Santa gave us an Early Christmas Gift!

Just got this feedback from one of our esteemed clients in Financial Services Vertical, from Shanghai. This is about an Oracle CRM On Demand implementation we are doing for them. Great to hear their comments about this engagement, an early Christmas gift we should say 😛

CRMIT team’s timely follow up on the new business requirement or system emergency is impressive. The team’s technical expertise is also well demonstrated through several critical enhancement they delivered with good quality within the past 2 years. Please allow me to take this opportunity to express my thanks to the team. Good job and let’s keep up 🙂

Social CRM : B2B & B2C Scenarios

Today we got an interesting Presentation link about “Social CRM in B2B”. We opened it eagerly and alas, it was in French!

No worries, sooner or later, someone will translate it to English. But still, we wanted to browse thro’ the slides and found two fantastic images comparing visually how Social CRM approach differs between B2B and B2C. Thought of sharing them with you.

Before we get to that, few words about this presentation, It was prepared by BroadVision ( and all rights to the below two pictures belong to them. The original slides are here (If you know French) :

Social CRM at B2C:

Social CRM at B2B:



A CRM Fairy Tale

Recently I attended a teleconference with a prospect. We were trying to suggest CRM as a solution to their current business pain points, they appreciated our approach, but were not sure if it will really solve their problem.

One person in particular raised some very basic doubts, like ‘Do we really need CRM?’

It sounds a bit silly, but his argument was solid: ‘My sales team is already comfortable handling the demand we have, and our success to failure rate is excellent, we meet and exceed our targets even without CRM, what’s the big deal?’

We tried to answer his question with a discussion on “What is CRM?” and “Why every business needs CRM?”. But still, he came back to the same argument, “I am doing good without aCRM, What difference it can make? Give me a real, practical example!”

At that pressure moment, I tried a stupid trick, using a very simple imagery (fairy tale, really) to explain what difference CRM Makes:

‘Imagine you are standing beneath a magic tree. Instead of fruits, this tree has lots and lots of coins, some of them are silver coins, some are gold coins, and some are platinum coins.

Once these coins are ripe, they fall on the ground, you need to catch them and pocket them.

Trick is, if a coin touches the ground, you lose it permanently. You can’t get it back!

So, you are running around, catching coins as they fall. After sometime, you become so good in it and are able to catch lots and lots of coins.

End of the day, you count your coins. 160 coins in all, 10 platinum, 50 gold and 100 Silver, Happy!

Now, imagine you build a large magic plate around this magic tree, Coins fall on this plate, You don’t have to run to catch them, instead you can peacefully have a look at them, analyze which coins give you the best value and pick them. Later you can throw away all the low-value coins.

In this scenario also, you may end-up picking the same number of coins (160), But because you are not rushing and carefully choosing your coins, you will have many more Platinum and Gold coins, instead of silver coins.

Now, mapping this tale to your business scenario, that tree is nothing but your market, coins are opportunities, some of them bad, some good, some very good and profitable, they are constantly falling and you run around the tree trying to pick the coins that come your way, you may be missing some Platinum coins, but you can’t worry about that, because you need to run, run, run.

If you have a CRM system in place, it is like this magic plate, It catches all the coins and presents to you in one view, gives you tools to analyze which ones are good, prioritize them and pick the really good ones which give you the best returns. It saves you time, and energy.

With or without CRM, your capacity is only 160 coins, but with CRM, you get the best returns.’

This is a story a school boy would prefer, not the corporate executives. But surprisingly, it clicked. They didn’t jump and sign the contract immediately, but at least they got the message loud & clear, and were much more open to our recommendations after that.

Hmm, I need to spend more time with my daughters, to pick such stories 😉

– Naga Chokkanathan

Is Microsoft going to survive the macro hard times?

An article by our CRM Consultant Sai Ratnakar Bezawada on Microsoft’s Mobile / Smart Phone Operating System Strategy:

Shopping for a mobile was never an easy decision since its inception, now with rapid technological advancements in the smart phone market there are a number of mobile applications being developed everyday and published to make life simpler and easier. Some of the apps can do almost any miniscule task that one could actually do by maintaining a pocket diary (of course a decade ago). However mobile makers haven’t realized that the decision making to purchase is getting even tougher.

With most of mobile companies are at loggerheads with each other, does a late entrant giant like Microsoft stand a chance to survive the litmus test?

I was fortunate to attend the closed door Microsoft windows mobile leadership event last weekend at Microsoft, Bangalore. The main idea behind the meet was to suggest an idea to what Microsoft could best do and how best they can penetrate their newly developed mobile OS product into the market. Surprisingly almost all of the attendees were developers, app designers and some of them design mobile applications as a hobby.

The meeting began with the sales director of Microsoft (India) explaining the OS and usability features of the phone and its features. The promotions that they were using in India was very interesting. the idea was to develop mobile apps on the windows mobile and get a free windows phone from Microsoft!

If you are an app developer in a competing technology (like Apple iPhone or Android), it is relatively easier to grab a free Windows phone. All you have to do is, port any 2 of your existing mobile phone apps from the competing technology to Windows Phone app. It is obvious that Microsoft is trying to attract Android and iPhone app developers into the Windows Phone app development and if you are a woman, it is the best part of the free phone deal. Woman app developers can walk away with a free Windows phone from Microsoft by developing just one qualifying Windows Phone app. I believe this is a limited offer available only to the first 100 women developers unfortunately. However in simple terms, all this would constitute legal app poaching.

The discussion was more technology driven and ended with the meeting not justifying the intent. However, while the Windows OS, being the latest software which is still in the process of creating a space for itself in the market, it is really going to be an uphill task for Microsoft to survive the competition, especially after tying up with a hardware manufacturer Nokia which has a dwindled market share to below 30% in the mobile market.

In conclusion, it is really hard to predict Microsoft as this could be also be the revival of the phoenix as Microsoft has stood through the test of time.