The Difference Between Database Marketing and CRM

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Posted 25-Jul-2005 09:34 AM
Hi
Database marketing is a data driven approach towards providing an integrated multichannel customer centric environment for a customer better customer experience.

Also CRM is a process driven approach towards providing an integrated multichannel customer centric environment for a customer better customer experience.

So finally the difference between the above two just drops down to one being a data driven or product driven approach and the other being a process driven approach. But is there more to it?

Let’s discuss.
Regards
Robin Dua


Paul Greenberg
Guru
Member

Posted 25-Jul-2005 11:14 AM
Hi Robin, I’m going to respond to your two questions on the site which both ultimately revolve around what CRM is. The first question was on the value of the right brained aspects of CRM which include culture change, process transformation and collaboration around the more behavioral and emotional pieces of CRM. The second is the the approach of CRM as process driven vs. database marketing being data/product driven.

Ultimately, CRM is the name given to business strategies and value propositions that both provide and receive value from customers. When applied to the real business world and when we can get it beyond the “CRM is a technology” humm that remains in the ears of many who think about it, what we find is that CRM will encompass or at least consider the following pieces (in no particular order):

Mission
Vision
Objectives
Business Requirements
Process Redesign
Business Case
Risk Assessment
Metrics/Benchmarks/ROI
Culture
Communications
Vendor Selection Strategy
Model Projects
Customer Experience Management

What makes it unique is that it identifies all the processes and technologies and programs that are critical to the creation of customer value but also to the identification of the return in value that the company will get from the customer. It too goes through transformations, even though it might still be called CRM. For example, CRM of 5 years ago was categorized by META Group as operational, collaborative, analytical and by Gartner and anyone else who defined it as encompassing sales, marketing, and support processes. Now, it is being tied to the entire value chain as supply chain programs and processes are seen as customer issues and the seamless functioning of the entire extended value chain—the demand and support chains and the partners/suppliers/vendors demand and support chains must function together to create the kind of customer experience that an individual customer demands. Plus the customer demands more transparency into corporate processes than ever before so that has to be taken into account. Advocacy in 2005 is the Loyalty of 2002 and the Satisfaction of 1995. In other words, what CRM is methodologically and programmatically is always fluid, but what remains unchanging is the committment to two-way customer value. That also means that the technologies and the systems have to meet the requirements that drive the execution of the strategy. Ultimately, too, whatever the changes in the strategy and methodology that CRM uses, there has to be a corporate culture to support the changes—and that just isn’t easy. But culture change is a big part of that effort.

So in answer to your questions—on the left and right brained aspects of CRM, there really aren’t any distinctions—CRM is a “whole-brained” programmatic, ongoing strategy that consists of the execution of the strategy and the culture to support the execution—all based on the giving and getting of customer value.

On your other question—I hope that you see there is far more to it than just process driven vs. data driven.

I hope this helps. If not, let me know and I’ll answer further.

Posted 25-Jul-2005 10:27 PM
Hi Paul
I really appreciate the detailed response. Thanks for taking some time off your busy schedule to answer my queries.
Regards
Robin


sally
November 22, 2007
Thanks for the post, nice

Thanks for the post, nice explanation on Database Marketing and CRM.
chrisadam
August 30, 2010
The Difference Between Database Marketing and CRM

CRM should be process-centric as well as customer-centric, involving everything a company does, or can do, to create value (as the customer perceives it). The fact that many executives, and vendors in the CRM field, still narrowly define Customer Relationship Management exclusively around the development and management of customer data helps us understand why so many CRM programs fail to meet objectives. Database marketing/management isn’t CRM and CRM isn’t database marketing/management. Database marketing can, and should, be considered one component of CRM.

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