The CRM landscape among respondent firms. Current an

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Survey FindingsMeasuring the ROI of CRM

• A survey conducted by Peppers and Rogers Group
  and TechTarget

John Gaffney, Executive Editor
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Agenda

• Survey overview and methodology
• The CRM landscape among respondent firms
• Current and planned CRM spending
• Functional and fiscal responsibility for CRM
  initiatives
• Primary functional areas of CRM initiatives
• The role of ROI in CRM
• The importance of ROI measurement and tracking
• The role of ROI metrics
• ROI measurement areas
• Challenges of measuring ROI
• ROI results
• What does all this mean?

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Overview and Methodology

• Peppers and Rogers Group and TechTarget conducted
  the CRM ROI survey to explore the presence and
  context of ROI within CRM initiatives in
  institutions as represented by high level
  executives and marketers.
• In November 2003, 113 users of CRM products and
  services completed the survey.
• Findings are self-reported and are not
  projectable to the entire US business population
  the results do provide good insights into the CRM
  programs in place today and the role of ROI
  metrics in investment decision making and CRM
  program success.

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Survey overview and methodology

• The CRM landscape among respondent firms
• Current and planned CRM spending
• Functional and fiscal responsibility for CRM
  initiatives
• Primary functional areas of CRM initiatives
• The role of ROI in CRM
• The importance of ROI measurement and tracking
• The role of ROI metrics
• ROI measurement areas
• Challenges of measuring ROI
• ROI results
• What does all this mean?

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2003 spending on CRM as planned

• 39 of respondents note that compared to their
  planned 2003 budget, actual spending on CRM
  products and services was about the same
• Only 6 state that spending was higher than
  planned

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yet 2004 sees overall increase in spending

• 30 expect CRM spending to increase over the next
  12 months, compared to 2003
• 17 expect CRM spending to increase between 6 and
  10 and 13 project spending to increase more
  than 10 over the next 12 months, compared to
  2003

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Marketing most often manages firms CRM
initiatives

• Respondents state that marketing (30.6) most
  often manages the enterprises CRM initiative,
  followed by the companys executive committee or
  CEO (16.2)

Q Which internal team manages your enterprises
CRM initiative? Unweighted N111 survey
respondents
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yet, marketing, most often maintains fiscal
responsibility of CRM

• Marketing (26), Executive Committee (including
  board and CEO) (23) and Finance/Operations (20)
  most often maintain fiscal responsibility of
  enterprises CRM initiative

Q Which internal team maintains fiscal
responsibility of the CRM initiative? Unweighted
N111 survey respondents
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Firms report that sales and marketing are most
often primary areas of CRM initiatives

• Respondents state that sales effectiveness (lead
  management, customer profiling, SFA, etc.) (67)

Q What are the primary functional areas of your
CRM initiative? (Check all that apply)
Unweighted N111 survey respondents
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Overview and Methodology

• The CRM landscape among respondent firms
• Current and planned CRM spending
• Functional and fiscal responsibility for CRM
  initiatives
• Primary functional areas of CRM initiatives
• The role of ROI in CRM
• The importance of ROI measurement and tracking
• The role of ROI metrics
• ROI measurement areas
• Challenges of measuring ROI
• ROI results
• What does all this mean?

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ROI measurement rates as important to
respondents

• 61 rank ROI measurement and tracking as very
  important or important to their companies, almost
  always requiring business cases for investment
  decision-making

Q How important is ROI measurement and tracking
to your company?
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ROI metrics played role for almost half of
respondents CRM initiatives

• 47 of respondents note that ROI metrics were
  used to build a business case and forecast
  results of the CRM initiative only 14 state
  that ROI metrics played no role in making the CRM
  decision

Q Which statement best describes the role ROI
metrics played in your companys decision to move
forward with your current CRM initiative?
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More than 80 of respondents will consider ROI
metrics

• 29 of respondents note that CRM decisions will
  be made based largely on ROI metrics 52 state
  CRM decisions will be made based somewhat on ROI
  metrics

Q Which statement best describes the role that
ROI metrics currently plays in your companies CRM
decisions?
14
Money talks Respondents measure revenue
enhancement

• Revenue enhancement (63), customer satisfaction
  (53) and cost savings (50) are the primary
  areas respondents measure the ROI of CRM

Q How do you measure the ROI of your CRM
initiative? (check all that apply)
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Checking the numbersData becomes the clear
issue

• Respondents cite that unreliable or inaccurate
  data (40), lack of consensus on which metrics to
  use (37) and no clear ownership of measurement
  criteria within the organization (37) are the
  biggest challenges in measuring the ROI of CRM
  initiatives

Q What have been your biggest challenges in
measuring the ROI on your CRM initiative? (check
all that apply).
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. . . Finally, relevance of the data becomes a
challenge as well

• Despite other reports to the contrary, 44.2 of
  respondents note that the ROI of their CRM
  implementation was not used or not applicable
  only 16 said it was higher than expected

Q The ROI of your CRM implementation was
(choose one)
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What does all this mean?

• Survey responses indicate an awareness and
  willingness to measure the ROI of CRM
  initiatives, yet they are limited by a lack of
  know-how or capability to overcome measurement
  barriers.
• Inaccurate data is a huge problem that must be
  addressed and improved by first applying
  effective strategy and expectations.
• How do we define success? Metrics gained from ROI
  initiatives need to be clearly defined. Companies
  need to understand how ROI is achieved and
  understand their data.