These days, you hear a lot about customer engagement management (sometimes called customer experience management), or CEM. Yet if you already have a customer relationship management (CRM) solution in place, you might think: what’s the difference? And more to the point—why do I need it?
To help answer these questions, we talked with SiriusDecisions research director Bob Peterson, who notes that CEM gives sellers a powerful tool to outstrip competitors. For example, recent SiriusDecisions research shows that businesses with a dedicated CEM function have significantly higher overall growth than those without. “Companies that invest in customer experience are also seeing improvement in key customer engagement areas, including customer response rates, revenue growth, retention rates, loyalty scores, and customer profitability,” Bob says.
CRM vs. CEM: How do they compare?
So what exactly is CEM, and how does it relate to CRM? Though definitions vary, here are some basic guidelines:
- CRM refers to the database-type solutions companies use to manage interactions with customers and prospects. CRM provides a centralized system of record where you can collect information on customer transactions and interactions, enabling you to organize, automate, and synchronize data from sales, marketing, and (sometimes) areas like customer service and technical support.[ii] While CRM is most commonly used to support sales-related activities and goals, it can also be a valuable resource in improving customer service and satisfaction.
- CEM has a broader focus than CRM, encompassing non-selling ways of engaging that affect customer experience (i.e., the perception of value customers get from exposure to your brand). Gartner defines CEM as “the practice of designing and reacting to customer interactions to meet or exceed customer expectations and, thus, increase customer satisfaction, loyalty, and advocacy.”[iii] SiriusDecisions describes it as the ability of a B2B organization to connect with its customers over the various stages of the customer lifecycle in ways that are meaningful to the customer—and tied to their specific goals. “This could include how customers are using your products and services, how they interact with your company, and even how they’re connecting with other customers or prospects; it also brings in the emotional connection the customer has with your brand,” Bob says. And of course, the way you implement CEM directly impacts customer advocacy: the case studies, sales references, press or social media commentary, community participation, and other activities through which customers share their opinions about your business.
The bottom line? While CRM can play a crucial role in supporting your CEM efforts, the scope of CEM extends far beyond that of CRM to cover the entire customer lifecycle, including the times when:
- They first learn about your company and take steps to find out more
- They begin to buy from you
- They utilize your after-sale service and support
- They participate in online communities, customer advisory boards, user councils, and events
- They (hopefully) become a happy advocate for your brand
And in addition to quantitative data from CRM and other sources, CEM looks at qualitative information on customers’ experiences, interests, motivations, and behavior before and after the point of sale. With CEM, you gain the 360-degree understanding you need to personalize engagement at every touch point in the customer journey.
What makes CEM so popular, and how can it boost your business?
While CEM is still relatively new within B2B, its growing prominence stems from several key drivers:
- The revolution in customer empowerment. Not so long ago, sellers largely controlled the cadence and content of information visible to prospects and customers. But today, buyers have grabbed the reins: more than 70% of B2B customers research prospective purchases online,[iv] completing close to 60% of the buying process before they ever contact sales.[v] CEM makes it easier to meet the needs of these better-informed, savvier customers while restoring equilibrium to the buyer/seller dynamic.[vi]
- The growth of social media. More and more buyers and prospects are using social media to talk to each other. And the majority of them—particularly those in the C suite—rely heavily on social networks and peers when making purchasing decisions. CEM gives you a way to capitalize on this trend. “The advent of social channels has dramatically changed how engagement works,” Bob points out. “B2B organizations that facilitate this by providing opportunities for customers to interact can strengthen adoption and engagement, laying the groundwork for a better customer experience, improved cross-sell and retention performance, and greater opportunities to foster customer advocacy.” The result? Enhanced delivery on a wide range of KPIs.
- The demand for better service. It’s no secret that B2B customers, primed by their experiences in B2C, expect higher levels of service than ever before. In fact, 62% of companies in a recent Aberdeen survey named this demand as the leading business pressure they face.[vii] CEM gives sellers clear visibility into not only customers’ transactions but also their wants, needs, and feelings—providing the insights necessary to deliver more personalized and timely service.
- The need for a bird’s-eye view. While most sellers capture plenty of data about their customers, it typically resides in different systems and departments across the organization—or in external areas like partner communities or services groups—creating silos of information that each contain only a slice of the truth. CEM breaks down those barriers to create a more holistic picture. “Within sales, marketing, and customer support as well as product development, product management, and product marketing, companies are finding ways to say, first, what are we learning about engagement in each of these functional areas? And second, what picture is being painted by the aggregate of all these customer insights?” Bob says. “It’s still early days, but that’s the great opportunity facing B2B marketers, and the next stage in the evolution: putting all these disparate sources of customer engagement data in a place where everyone can see it, understand what it means, and turn it into actionable information that’s meaningful for both the customer and the company.”
How can I get started?
For tips on the best ways to implement CEM in your organization, check out “Part 2: Five Surefire Strategies to Support CEM Success.”
[i] Bob Peterson, “The Customer Experience/Customer Advocacy Connection,” Slideshare presentation, SiriusDecisions, 2014.
[ii] Ohad Hecht, “CEM vs CRM: Which Platform Is Better?” ClickZ Marketing News & Expert Advice, 24 February 2014.
[iii] Gartner IT Glossary, “Customer Experience Management (CEM),” Gartner, Inc., 2013.
[iv] “B2B Buyers Prefer Short Content; Rely Heavily on Google Searches,” MarketingProfs, 19 November 2013.
[v] “The Digital Evolution in B2B Marketing,” Corporate Executive Board, 2012.
[vi] Peter Ostrow, “Customer Engagement Has Evolved: Can Your Sales Team Keep Up?” Aberdeen Group, 10 September 2014.
[vii] Peter Ostrow, “The 21st Century Buying Experience: Say Farewell to the Sales Cycle,” Aberdeen Group, 21 July 2014.