Why has PRM become increasingly important to your customers?
There's been a lot of conflict in the channel because of the fear that manufacturers and OEMs [original equipment manufacturers] were going direct to customers. One article after another talked about "dis-intermediation," and everyone was up in arms. As it has played out, just the opposite has happened. As the Web channel has been integrated with customer touch points, customers have actually increased their use of the indirect channel and partners to get value-added services. Now that the worry has subsided a bit, the focus of these "partner networks" has shifted from an adversarial relationship between brand owners and channel partners to more of a collaborative approach. They're looking at competing as a partner network. If you look at the financial services, high-tech or automotive industries you've got complete partner ecosystems competing against each other. What sort of functional CRM elements are most important to companies engaged in this trend?
Collaborative marketing has to be the most important, and the idea behind this has been out there for some time. If General Motors could empower its dealers to build and maintain relationships with customers, not just at individual dealers, but also across its entire dealer network, there would be tremendous value in that capability for both the dealers themselves and the GM brand. We're seeing that in financial services as well. The continuity of the relationships, the consistency of the message, is an ultimate business objective for the partner networks. And it allows them to be more targeted in the front-end of the customer positioning process as well. Are those the vertical industries that are most focused on PRM?
Yes. I mention them because all three markets are built around channel models, where the partner is primarily or exclusively focused on a single relationship with a brand owner, OEM or financial services provider. We see a trend evolving where the brand owner is actually providing robust CRM capabilities through a portal. We're calling this "partner CRM." What is the biggest challenge in terms of deploying the necessary technology into vertical industries? Is there still a learning curve throughout these partner networks?
PRM has long been associated with portals. Technology can play a direct role in making interactions more efficient and getting the right kind of knowledge out to partners, but it's only as effective as it is adopted. Over the last three years we've tried to identify what capabilities are most important to partners and make it available in an intuitive interface. A major challenge has been providing robust functionality to partners that perhaps aren't that sophisticated when it comes down to technology. You have to make it self-apparent and require very little training. The challenge is making it drop-dead simple. Haven't businesses been trying to deliver this sort of consistent message through marketing for a long time?
Yes, for years. But it's just now that the technology that these companies need is available through the portal environment. Haven't businesses been trying to deliver this sort of consistent message through marketing for a long time?
When I talk to customers I hear that they want develop brand strategies at the global level, but empower distributors to act locally. In the case of an automotive company this might involve letting a dealer have more control of marketing to add or remove marketing programs to meet its specific needs. If DaimlerChrysler is about to sell someone an expensive Mercedes-Benz, they probably don't want to flood that person with offers for a lower-end Chrysler PT Cruiser. Do you feel that the openness of companies in the verticals we mentioned to PRM is a sign that they are more mature than others in their CRM efforts?
Yes, that is absolutely the case. In many ways the state of PRM today is analogous to the state of CRM five to 10 years ago. The companies making big investments in PRM are doing so because they see a significant business benefit in the short term and down the road. It leverages their existing investments in CRM.
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Does this whole effort ever translate into resentment from the partner companies?
There may be tension in some situations. In the case of an insurance agent who sells multiple product lines from different vendors there may be concerns about one provider effectively dominating their business. But if PRM is done right, an agent can look to the host company using PRM as the easiest one to work with. It's another area of competitive advantage for the insurance company utilizing the technology. They're making the agent's job easier.