Addressing customer myopia: Strategic interactive planning in a volatile business environment Received (in revised form): 23rd October, 2001

Terry Kendrick is a strategic marketing planning and information consultant who since 1984 has worked on consultancy projects for over 50 organisations in 17 countries. Projects have ranged from facilitating marketing plans and developing key account management processes to the analysis of customer attractiveness and profitability issues in specific companies.

Keith Fletcher is Professor of Management at the University of East Anglia and was founding Dean of the School of Management. He has lectured extensively overseas and is Chair of the East of England network for Interactive Marketing. He gained his doctorate in consumer decision making and his research interests include consumer behaviour, strategy formulation and implementation, and CRM.

Abstract This paper introduces and examines the concept of customer myopia, which is the over-reliance on the existing customer base rather than studying the whole market of potential and future customers. Eight assumptions are studied which illustrate customer myopia and the argument for a strategic perspective is put. How to implement strategic interactive marketing planning (SIMP) is explained in nine stages, within two phases.

INTRODUCTION combination of traditional marketing Traditional marketing planning and principles with CRM methods and acquisition marketing has been criticised technology to build relationships and as being product or sales focused and acquire new customers. customer retention and relationships have In companies where heavily sales-led been seen as the drivers for profitable approaches had resulted in mindless growth. Now is the time to question customer acquisition, regardless of whether excessive attention to the inherent profitability, CRM has promised existing customer base is the optimum business growth. In these companies way to ensure long-term profitable existing customers, with lower cost growth. structures, had been neglected with the This paper looks at the synthesis of consequent loss of potential profit. The customer relationship management promise of CRM was that it improved Terry Kendrick 14 Kingsley Road, Norwich, (CRM) and traditional marketing lifetime value by adding relationship and Norfolk NR1 3RB, UK. planning approaches with interactive service marketing concepts to database Tel: ϩ44 (0)1603 628818; marketing as the catalyst to provide a marketing. This allowed the building of Fax: ϩ44 (0)1603 628818; e-mail: t.kendrick@ meaningful business future for long-term successful retention approaches. Various netcom.co.uk players. Interactive marketing is the examples were given which showed the

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major impact this could have on loyalty approaches will need to be longer-term profitability.1 balanced with more traditional customer It is, however, clear that the acquisition approaches to take into evangelical fervour of some CRM account the volatile customer base and proponents has not always delivered the changing business environment. expected returns and the Alexander Unfortunately, this does not seem to be Group suggest that 60–80 per cent of happening and integrated marketing CRM projects are deemed to be strategy is not being implemented. unsuccessful.2 A report by Gartner Strategic interactive marketing suggests that more than half of all planning, bringing together the best of companies implementing CRM initiatives these approaches, looks likely to gain today will view those plans as failures by increasing importance in the next few 2006. Gartner attributes these failures to years as companies recognise that to a range of problems, including poor ensure they maximise profitability a new channel integration and the absence of a synthesis of business approaches and true process redesign.3 It is possible, models is required. however, that another contributory and, indeed, unifying factor could be the drift away from sustained clear thinking — CUSTOMER MYOPIA strategic marketing planning — aprocess In certain circumstances market which requires a clear linking of strategic conditions could lead a business to gaps, market analysis and integrated customer myopia. Customer myopia is applications.4,5 defined as a short-sighted over-reliance This paper highlights a number of the on the existing customer base rather than key questionable assumptions that studying the whole market of potential underpin some CRM thinking and and future customers. Companies must planning. It resolves these issues by always remain alert to where their future introducing the concept of strategic profits will come from, and not simply interactive marketing planning, a assume today’sprofitable customer will synthesis of CRM and traditional provide profitable business in three to marketing planning. five years’ time. Levitt introduced the The authors’ belief is that CRM is an idea of marketing myopia6 to explain the excellent core strategy for those few short-sighted focus on the product, rather companies that already have the best than the benefits the product gave. He customers in their industry (and where warned that focusing on present products these customers are likely to be the best rather than benefits to the customer customers in the industry in the future), meant that future innovative products and where both partners, company and from competitors were ignored, as they customer, are likely to want to enter into did not fit the mindset of the business. a relationship. Many of the dangers Levitt Whereacompanyhasonlyasmall highlighted have now been recognised portion of ‘best industry customers’ in its by companies, and CRM has encouraged portfolio a mixture of alternative the move away from the product focus approaches will be needed. Similarly, to the customer. CRM also has some where buyers are switchers and do not dangers however. By focusing too want to enter relationships then narrowly on the nature of existing reputation and building may be customers, the opportunities from future required through mass marketing. CRM customers may well be ignored.

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Customer myopia will manifest itself assumptions which are, to say the very in an over focus on retention and least, questionable. By looking at these relationship marketing. To achieve this assumptions customer myopia can be the concentration is on data illustrated. warehousing, collecting data from more Assumption 1. The remaining share of and more contact points in the hope of customer spend is significant and worth differentiating actual customers. Patterns having. In the example above what is the in the existing customer base will be ‘dry-cleaning-bill-not-already-achieved’? studied, and product and service offerings If a business already has the easy 80 per customised, without questioning whether cent of a customer’s total potential spend, the existing customer base is the right will investing in winning the final one for the future. notional 20 per cent really provide sound Sources of future profits in a future growth? When contrasted with the easy business environment may be 80 per cent of a new customer’spotential significantly different to the existing spend which is the better investment? Of market conditions. By analysing existing an existing customer’s five dry cleaning customers too closely aspects of the purchases per year the initial four may be changing environment, such as new profitably won but the final one may, for markets, may well be missed. Peppers a number of reasons, be less easy to and Rogers give the example of IBM, achieve. who by staying too close to its Assumption 2. The lifetime values of mainframe customers missed the early customers are worth having and investing in. wave of PC growth by not conceiving In addition to the potentially modest how the new market would revolutionise level of customer value to be won, its own business. Other leading businesses need to take account of the companies may well be falling into a real lifetime of their customers. If people similar trap. move home on average every seven Despite this, an example of this years then it is unlikely, for the dry customer myopia is actually given by cleaning example, that, on moving, the Peppers and Rogers when they same outlet will be used, or even champion a dry cleaning company. The necessarily the same chain. Location and dry cleaning company is quoted as convenience are more likely choice saying: criteria resulting in short life times for most customers. In many markets with ‘Instead of trying to get as many dry cleaning changing and temporary needs customers in town as possible, we will try to recognising the potential new customer is get more business from each of the customers more important than stopping the exit of we already have. We’ll make sure to get all the old. the dry cleaning repairs and alterations, Assumption 3. Customers care about and speciality cleaning and so forth for each of are involved with products. Where products them forever, as well as win direct referral are distress or low-involvement purchases 7 business’. then loyalty and relationship issues are not likely to apply in choosing an outlet. Now, while it is clearly a good idea for a In the case of dry cleaning how business to sell more of what it does important a decision is it? While many already to those customers it already companies believe their products or knows well, the fervour of the quoted services should be seen as important, dry cleaning company is based on high-involvement products, often this is

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not the case. It may, as the mantra goes, company to develop its existing customer cost more to win a new customer than base, except on the grounds that those to keep an existing customer but churn are the only customers they have? It is may be a natural market dynamic not clearly theoretically possible for a easily influenced by CRM tools and company to discover that its customer techniques. Some customers can be base is simply those customers that developed and some cannot. competitors do not want. The authors’ Assumption 4. Getting customer consulting experience suggests that this is relationship management right leads to loyalty not just theoretical but can have which should ensure that competitors will not frightening resonance when companies get another business’scustomers.This may be are confronted with this possibility. a necessary (and even that is Assumption 6. With better information in questionable) but it is certainly not a its customer information file a business can sufficient condition to ensure continuing understand its customers better. CRM sales. The word ‘loyalty’,whenbased systems are always based upon a very upon behaviour, becomes little more limited amount of information about the than propensity to not change and two marketplace and customers. A company or three purchases allocate a customer to will never have perfect information about the ‘loyal’ bracket.8,9 Under such rules, its customers allowing a truly one-to-one however, customers are loyal to Tesco, relationship. Customers lie, change over Sainsbury, Iceland and the local corner time, and will not be pigeonholed into shop. Such a definition of loyalty segments. Companies analyse very few of becomes meaningless — logicians might their customer data, some analysts call it the ‘death of a thousand loyalties’. suggesting that most companies actually Customer loyalty is nothing more than analyselessthanhalfofthedatathey the fact that they have passed that way collect. and wanted something and have done Assumption 7. Given information on this on more than one occasion. Loyalty customers, knowing what to do with it will be is something supporters have to a football easy. Even when attempts are made to team. It does not matter how often the analyse data, conclusions do not come team loses the supporters will return and easily. Should it be concluded that 80 are loyal. How many will return to their per cent of customers would choose the favourite dry cleaning shop if the service business next time just because their is consistently poor and the product does tear-off slip says they will? Disciples of not deliver? CRM and one-to-one marketing can In addition, customers are not always sometimes exhibit excessive faith in persuaded by reason and the best offer statistical techniques. They show does not always win. Satisfied customers symptoms of customer myopia, deluding defect, given the right incentive, or themselves into believing that they have simply want a change of supplier. For agreaterinfluence over customers’ the dry cleaner in the example to talk buying patterns than in reality they have. about getting business ‘forever’ is Modelling such behaviour is too time patently unrealistic. consuming and its predictive value is Assumption 5. Present customers are the questionable. best customers. A recent market entrant Assumption8.Thefuturewillbesimilar may ‘buy’ itself a significant customer to today. Focusing on existing customers base, high on numbers, low on assumes that if a particular type of profitability. Is it right for such a customer is profitable today then they

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will continue to be so. Is this true? Large Customers are not distributed equally by customers may be profitable today but profitability throughout the industry in the future profitable customers may not some mystical way. Some competitors bethesameasatpresent.CRMdoes have better customer portfolios than not always highlight what is possible others do. If a business has a poor within a marketplace even when it can portfolio then it should get new highlight what is possible within the customers. A customer retention strategy existing customer base. Some might for a company with an unprofitable argue that there is no need to look very portfolio, which has no realistic way of far beyond the existing customer base if being turned around in the next three the returns from that are sufficient to years, is clearly not operating on a sound satisfy shareholders. Caution is, however, business model. urged here. To exist happily on a fully developed existing customer base may allow competitors to exploit other areas THE SOLUTION: STRATEGIC of the market with the consequent PERSPECTIVE ON CRM experience allowing them to become Effective CRM processes ensure that significant competitors in the business’s elements of relationship and service core customer market. marketing such as technology, tools, Undoubtedly, CRM approaches are an processes and people are front of mind important part of good business practice throughout the marketing planning but, as these assumptions and tendencies process. These elements, however, need above show, there is great potential for direction to ensure that the outcomes of customer myopia. There are clearly the improved information flows, such as businesses where most effort should be improved service and greater efficiency, spent on existing customers and in these are translated into meaningful strategic markets many benefits can be achieved. thrusts.10–12 This direction can be lost if A balance to retention over acquisition CRM develops management processes should be continued where: that are separate from strategic marketing planning. — the market is mature with little An essential difference exists, however, growth in CRM planning between two types of — the business has a set of some of the company in relationship to the barriers most profitable customers in the likely to inhibit successful adoption and industry implementation of CRM.13,14 Akey — competitors cannot easily copy and market for many IT consultants is those better the business’s best offers companies which are considering the — customers have high involvement and move to CRM, but do not have the desire added value customer information or technology — the product/service features need which would allow them to take the first regular maintenance, there is a high step. For these businesses, before they purchase frequency or there are high can accept adoption of CRM processes, switching costs. a business case will need to be created that justifies the major technological If, however, the business has some of the investment required to build the worst customers in the industry as its customer information file and manage portfolio, or they will become so in the the customer interactions. For these future, then this does not make sense. companies the degree of organisational

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change required can be substantial and a and ambition (both in terms of general danger is that the software choice and mission, vision, values and financial installation distorts the purpose of the objectives and shareholder requirements). exercise. The difficulty for many of these Once identified and agreed this is companies is that having implemented typically followed by a situational analysis the system they often do not know what or marketing audit, leading to a summary to do with it. Some useful guidelines in a SWOT analysis. Out of these have been produced which attempt to analytical stages the marketing objectives overcome these problems.15–17 and strategy are determined, based on Other businesses may have taken the the factors previously noted as relevant first steps to implement a process, and to the company. When proposed may already have identified customers, strategies are agreed to be strong enough but have not a sophisticated CRM to deliver the level of corporate ambition system, or have not found CRM and corporate financial objectives these applications successful. A subset of this are then implemented through a detailed group would be business-to-business action plan. companies and small to medium size During implementation the whole enterprises (SMEs)18 who because of their process is monitored to ensure that the smaller customer base may already be actions are implemented and that the practising key account management for chosen strategies are indeed delivering some customers but are having difficulty the marketing and financial objectives integrating the two differing frameworks. and ambition set out by the company in The important factors which need to be the early stages of the planning process. considered for the adopter companies are Utilising this planning approach, as fundamentally different from those outlined in McDonald’s well-known needed in the later implementation ten-stage process,21 may, despite its stages19 and this needs to be considered potential for including many interactive in the strategic planning process. marketing elements, lead to a Sophisticated CRM adoption, process-driven, fill-in-the-box marketing particularly for the first group, has the planning process. Used in an clear potential to deflect attention away unsophisticated way both marketing from the changing business environment. planning and CRM approaches have the This may lead to the appropriate potential to deflect attention away from customer base being ignored in three to good in five years’ time. To make CRM companies. applications work the CRM process A close CRM-driven analysis of the needs to be driven from the outside in, current customer base is crucial to understanding customers’ needs but effective business planning but for sound ensuring strategic processes and CRM business planning this should also be in application functionality are aligned.20 the context of a wider marketing The CRM processes in themselves will planning process which integrates all not drive growth objectives, and these elements. need to be implemented into an overall In reality, both marketing planning and framework that manages all aspects of the CRM approaches are complementary, change process. even if they are often seen as separate The context for any traditional initiatives within companies. Frequently, strategic marketing planning process is company organisation structures do not the identification of corporate objectives reflect the degree of alignment required

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for effective business growth and an interactive action plan and concluding development.22,23 In the authors’ with a statement of planning and CRM consulting and related activities it is not milestones and implementing monitoring unusual to see CRM and strategic procedures. marketing planning projects led by In more detail these phases and stages different teams and an internal rivalry can involve addressing the following key develop which is not to the benefitof questions. the business. In one major financial services company, for instance, traditional marketing activity is organised around Phase 1: ‘Where’s the best product lines and CRM activities are business?’ organised around customer groupings administered in a separate building. Stage 1: Agreeing business ambition GiventhisneedtoalignCRMand and corporate objectives marketing planning approaches the Without a clear idea of level of ambition authors advocate strategic interactive and corporate objectives there is no marketing planning (SIMP) as a context for developing marketing response. planning and CRM approaches. Strong The following outline process offers an ambition will often require a balance approach to undertaking CRM within a towards innovative rather than wider business and marketing planning continuous improvement approaches context. It ensures that a business or while modest ambition will suggest marketing planning process is always priority be given to continuous considering the importance of customer improvement rather than innovation. retention and management, while at the The level of ambition will help make same time protecting CRM practitioners the decision in the later stages of the from customer myopia. process as to the relative balance of customer retention/acquisition and one-to-one/mass marketing. HOW TO DEVELOP THE STRATEGIC This stage is about being reasonable INTERACTIVE MARKETING and challenging and sets the context for PLANNING (SIMP) STAGES the amount and type of business that the SIMP is best thought of as nine stages, strategic interactive marketing plan within two phases. Phase One is should chase and, through essentially based around the question implementation, win. The future is ‘Where’s the best business?’ The stages unlikely to be similar to today and there are based on agreeing corporate ambition should be a feedback loop to enable later and objectives, analysing the existing understandings to influence this ambition. customer base, analysing the potential Discussion in this stage will focus on customer base, concluding with an questions such as: assessment of the business’ readiness for effective marketing planning and CRM. — what is the business idea Phase Two is essentially based around (vision/mission/values) the subsequent question ‘Howwillwe — how will the business know if it is win it?’ The process has stages based on succeeding an implementation gap analysis, planning — what will be the financial and other and CRM objectives, developing an measures (such as market share) which interactive , formulating can be monitored to judge progress?

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Stage 2: Analysing the existing — how likely is it that these customers customer base will be with the business in three to This analysis should assess the five years’ time and what will they be contribution of the current customer base worth to it (lifetime values) to the longer-term future in the three to — how confident is the business that it five year ambitions of the business. The can deflect competitive threats analysis of existing customers will allow (competitive analysis) companies to determine the — what will it take for the business to characteristics of their ‘best’ customers, retain and develop its customers’ compared to their ‘worst’,24 and to business with it over the planning determine the ability to change the period (customer experience buying patterns of existing customers. management) This may well involve an analysis of the — which customers are likely to respond customer involvement to see which, if best to a relationship approach, which any, of the business’s customers care to a transactional approach? about and are involved with its products. A critical element of this stage is to consider the likelihood that these ‘best’ Stage 3: Analysing the potential customers might be seduced by customer base competitors, and the critical elements The analysis of present customers and that make them have a commitment and competitive threats will allow a much loyalty to the business. The assumption clearer understanding of the nature of that if a business gets customer new markets which might be available relationship management right then to the business by identifying unfulfilled competitors will not get its customers’ opportunities. Are present customers the business should be tested. Key questions best customers, will the new customers for this stage are: look like the old, and have the same needs, or will a new set of sales — is the remaining share of customer criteria be needed? This stage develops spend significant and worth having a high level plan of market — are the lifetime values of customers opportunities for replacement business worth having and investing in or growth. Key questions for this stage — wherearethebusiness’smost are: profitable customers both now and in the longer-term planning horizon — in addition to existing customers (customer profitability analysis) what customers are out there to be — can customer differences be analysed won and capitalised on (segmentation) — what levels of investment are — how much might the business expect required to win them them to contribute towards its — will investment levels allow longer-term ambitions (customer one-to-one marketing or will a profitability analysis) segmentation approach supported by — where might their custom be in the mass marketing be the most future and what does that mean for appropriate way forward the target business’s chances of — who ‘owns’ these customers at retaining their custom (key account present, and how will they react management and account when the business makes a play for management) them?

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Stage 4: Strategic gap analysis ensures that company structures reflect This stage assesses the position of the the degree of alignment required for business to meet opportunities identified effective business growth and in previous stages. Key strategic questions development. Various CRM include: benchmarking tools exist which can help companies understand their — does the business understand the capabilities in these areas. These tools market environment both now and include CMAT by QCi, the AMS any changes that might occur during iCVM Gap scorecard and Hewson’s the coming years Benchmarking Group. A summary of — is the business confident that it can the type of issues to be discussed is: survive volatile market conditions given the range of potential scenarios — technology issues: present state of that might occur customer information system — given satisfactory answers to these — information issues: customer data and questions what are the business’s modelling capabilities strengths, competencies and — process issues: degree of customer weaknesses service focus in key touchpoints — has the business sufficient customer — communication issues: customer information to develop sound strategies contact channels — does the business provide a single face — measurement issues: performance to the customer measures — are the business’sprocessesproductor — people and organisation issues: customer driven management and employee flexibility. — has the business a robust understanding of competitors and their place in its market both now Stage 6: Planning and CRM objectives and in the future? As argued above both marketing planning and CRM approaches are complementary, even if they are often Phase 2: How will the business win seen as separate initiatives within it? companies. This stage ensures they are integrated successfully. The assumption of Stage 5: Implementation gap analysis CRM is that given information about This stage investigates the barriers or customers knowing what to do with it constraints to implementing existing or will be easy. This is seldom the case and new strategies. What is stopping a ‘analysis paralysis’ seems to have hit some business getting there now? Established firms with large customer databases. In CRM players may well have many of stages 3 and 4 judgments will have been the people, processes, tools and made,inprinciple,ontherelative customer information already in place. importance of types of business (existing Other companies may well have to or new customers) which are expected to focus on improving in some areas deliver the corporate objectives. Given before marketing applications can be these corporate objectives: successful. As argued earlier, a stages model suggests that differing problems — how much of this requirement will will be faced depending on the present be met by mass, segmented or stage of development.25 This stage one-to-one approaches

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— where is there scope for relationship — how will channels, development, and which segments are including the Internet, best support simply transactional business development? — will growth be from existing customers either by increasing retention, upselling or cross-selling Stage 8: The interactive action plan — how much of the business’sprofit A well-developed strategy to integrate objectives will be met by new traditional marketing planning mass customers or segments marketing and CRM approaches will — over what time period is the business require a robust action implementation intending to grow these markets, or plan. Key questions this stage will answer upgrade these customers include: — how will the business measure success in its marketing strategies — what needs to be done to deliver the — are the business’s objectives strategies complementary or isolated — when should these things be done — whatchangesisthebusiness — who should be responsible for investing in based on the findings of ensuring they are done stage 5? — are the actions consistent with the strategies — is there enough action to implement Stage 7: Interactive marketing strategy the strategies far enough during the This stage determines and designs the planning period interactive marketing strategy to meet — what feedback mechanisms are there the objectives from the previous stage. It to manage the process makes decisions on the best way to — has enough resource been allocated to deliver the overall planning and CRM implement the strategies in the objectives. Key questions in this stage intended way? are:

— how will one-to-one CRM and mass Stage 9: Milestones and monitoring marketing approaches be combined to The move to implement CRM may need deliver the objectives a major process of change management as — how will customers be identified and processes and information flows are targeted modified. Alternatively, for some — how will customer upgrading be businesses, key account management achieved principles can be extended to include the — what marketing communications will wider marketplace. A process of need to be produced and mentoring is necessary during the implemented implementation stage to ensure the — what contact strategies are required integration process is monitored and — is the current product range essential objectives achieved. This stage appropriate or will investment in may well last the entire life of the business new products and services be strategy to ensure no bottlenecks or required barriers divert the initial business strategy. — what customisation is required The key milestones are identified to — what principles will support check that strategy deployment is decisions effective and implementation monitored.

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CONCLUSIONS value’, Harvard Business School Press, Boston, p. 322. There are circumstances where relationship 2Stifler, J. (2001) ‘What others have learned while marketing and retention alone will not implementing CRM’,CRMguru.com. deliver a long-term stable business. There 3 Gartner press release, 10th September, 2001. is thus an urgent need to place CRM in http://www.gartner.com/5_about/press_releases/ 2001/pr20010912b.html. the context of the wider world to avoid 4 Fletcher, K. and Wright, W. (1997) ‘Strategic and customer myopia. CRM is a valuable organisational determinates of information system business initiative, but only within the sophistication: An analysis of the uptake of database marketing in the financial services context of a wider marketing planning industry’, European Journal of Information Systems, strategy. Companies need to know: Vol. 6, pp. 141–154. 5 Galliers, R. (1991) ‘Strategic information systems planning: Myths, reality and guidelines — given the current volatility, they can for successful implementation’, European Journal survive given a wide range of of Information Systems,Vol.1,No.1, alternative scenarios pp. 55–64. — within these scenarios they understand 6 Levitt, T. (1960) ‘Marketing myopia’, Harvard Business Review, July/August, pp. 45–56. marketplace conditions and drivers, 7 Peppers, D. and Rogers, M. (1993) ‘The one to have structured around key segments one future’, Currency Doubleday. and formulated strategies (which can 8Hart,S.et al., (1999) ‘Are loyalty schemes a manifestation of relationship marketing?’, Journal be changed as circumstances change), of Marketing Management,Vol.15,No.6, supported by detailed action, pp. 541–562. contingency and resource plans 9O’Brien, L. and Jones, C. (1995) ‘Do rewards really create loyalty’, Harvard Business Review,Vol. (marketing planning) 73, May/June, pp. 75–82. — within the existing and developing 10 Goldsmith, N. (1991) ‘Linking IT planning to customer base they understand their business strategy’, Long Range Planning,Vol.24, portfolios and where their profits No.6,pp.67–77. 11 Ward, J. (1987) ‘Integrating information systems come from. Furthermore, they into business strategies, Long Range Planning,Vol. understand how to keep their most 20, No. 3, pp. 19–29. valued customers and how to develop 12 Wiseman, C. and Macmillan, I. C. (1984) ‘Creating competitive weapons from information other customers into more valuable systems’, Journal of Business Strategy,Vol.5,No.2, customers (CRM). pp. 42–49. 13 Fletcher, K. and Wright, G. (1995) ‘Organisational, strategic and technical barriers to To undertake CRM without this structure successful implementation of database marketing’, is to miss the point. If a business has ten International Journal of Information Management,Vol. customers and seven of them are in a 15, No. 2, pp. 115–126. fast-declining segment of the market, 14 Desai, C., Wright, G. and Fletcher, K. ((1998) ‘Barriers to successful implementation of database which may vanish in five years’ time, it marketing: A cross-industry study’, International would be foolish to concentrate on these, Journal of Information Management,Vol.18,No.4, regardless of how profitable they are today. pp. 265–276. 15 Seybold, P. and Marshak, R. (1998) A detailed assessment of lifetime values ‘Customers.com Handbook: An executive guide should clearly indicate the impending crisis and technology roadmap for your customer.com but no CRM approach will identify how initiatives’, www. customers.com, 85 Devonshire Street, Boston MA 02109 USA. to change. Only marketing planning, in 16 Peppers, D., Rogers, M. and Dorf, B. (1999) the context of scenario planning in difficult ‘The one to one fieldbook: The complete toolkit times, can offer that. for implementing a one-to-one program’, Currency, Doubleday. 17 Catalyst (2001) ‘The catalyst CRM methodology: References An overview’, European Centre for Customer 1 Reichheld, F. F. (1996) ‘The loyalty effect: the Strategies (ECCS), www.eccs.uk.com. hidden force behind growth, profits and lasting 18 Curry, J. et al. (1998) ‘Customer marketing: How

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to improve the profitability of your customer 23 MacDonald, H. (1991) ‘Business strategy base’,KoganPage. development, alignment and redesign’,in 19 Gartner (2001) op. cit. Scott Morton, M. S. (ed.) ‘The corporation 20 Stifler (2001) op. cit. of the 1990s’, Oxford University Press, 21 McDonald, M. (1999) ‘Marketing plans: How to NY. prepare them: How to measure them’, 24 Chalder, M., Gamble, P. and Stone, M. (2000) Heinemann, Oxford. ‘Managing good and bad customers in practice’, 22Chan,Y.E.,Huff,S.L.andCopland,D.G. Journal of Database Marketing,Vol.7,No.4,pp. (1997) ‘Business strategic orientation, information 356–380. systems strategic orientation, and strategic 25 Nolan, R. (1979) ‘Managing the crises in data alignment’, Information Systems Research,(ISR)Vol. processing’, Harvard Business Review, March/April, 8, No. 2, p. 125. pp. 115–126.

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