The Worst 5 CRM Analytics

Measuring the Wrong Customer Metrics Impedes Progress

Not all CRM analytics measures and performance indicators are created equal, meaning not all of them are useful. The challenge is in being able to tell which customer analytics will spur your company forward and which will leave you groping for profits in the dark.

"While traditional customer metrics, like call center average handle time or digital commerce abandon rate are still commonly used throughout the contact center and customer service industries, forward thinking companies are working toward balancing these operational results with contextual behavior analysis, ultimately, with an eye on business outcomes," says Mariano Tan, senior vice president of Professional Services at TeleTech, a customer relationship management company.

"Organizations that continue to exclusively pursue activity, vanity and tactical metrics will likely never elevate customer satisfaction or win customer brand ambassadors," he added. Prioritizing the highest impact performance metrics enables management to achieve the most strategic goals in the shortest time.

Dire words indeed in today's economically challenging climate. Obviously, changes in your CRM analytics are necessary, but be forewarned. You may not be able to find the analytics you need conveniently packaged in out-of-the-box (OOTB) CRM programs. Expect to create custom metrics or add a third party business intelligence (BI) tool.

"There are gaps in current CRM analytics available out-of-the-box even from major vendors," warns L. N. Balaji, president of US Operations at ITC Infotech. "For example, the same loyalty system cannot fit all and that is why Out-of-the-Box analytics solutions need heavy customization. At times they almost need complete rewriting because analytics systems depend on an organization's data classifications and maturity level."

In the interest of perfecting your processes and increasing your profits, here are five low value CRM analytics that you should re-evaluate, pull, plug, customize, extend or consider eliminating.


Available but not Meaningful Metrics

CRM systems have hundreds of key performance indicators but most are generic. Better to skip measures that are not helpful and acquire those that are. "Loyalty, Marketing, Sales, including point-of-sale (PoS), and Call Center/Customer Feedback Systems are usually missing from out-of-the-box CRM analytics and need to be acquired separately or developed from scratch, says Balaji. "Integration of multi-touchpoint business scenarios is fairly complicated to handle with out-of-the-box packages."

The following features are missing in most of out-of-the-box CRM analytics packages, according to Balaji:
» Exception Reporting
» Alerts and Notifications
» Guided Analytics
» Leading and Lagging KPI usage
» Threshold based flagging and reporting
» Storyline based report usage
» Predictive Analytics
» Pre-Built Data Mining models


Siloed Metrics

Analytics leading to departmental, silo'd or tactical reporting don't generally move the needle. Many business intelligence or CRM analytics tools don't possess the structure to directly align performance measures across business units and with the company's top business objectives. "Business Alignment may be completely missing, leading to confusion among the users," says Balaji. You'll get lots of numbers and summaries with this, but such will only deliver piecemeal information, tell you what you already know, or give you meaningless data.


Efficiency Metrics By Themselves

Efficiency metrics such as AHT (Average Handle Time) is still a staple of many call center reports. "It is a one dimensional measure which takes no account of outcome, be it sale or satisfaction," says Mitch Lieberman, Sword Ciboodles' Product Strategist. "It should always be part of a formula that represents cost versus value—essentially the ROI of each and every contact." As contact centers become smarter and more efficient, they can and should take time to actually listen to what their customers have to say. "Unfortunately, efficiencies are grabbed by the operational report readers and the ability to connect with customers at a human level is lost," he said.


False Indicators of Success

Email open vs click-thru rates are a good example here. Marketers still tend to believe that 'email open versus click through' rates are accurate indicators of campaign success. But that's simply not true anymore. "Most modern email systems block the required messaging, or read-receipts, and we're seeing less and less useful data being generated for email campaigns," says Lieberman. Instead, more sophisticated campaign metrics available in part from lead management systems deliver more useful metrics.


Inference Metrics

"How did you hear about us" polling is an example. The answer to this question is more likely to reveal which media source is top-of-mind and on the tip of your customer's tongue than it is to tell you which marketing channel is actually working for you. "Better to track visits, referrals and the like directly, or get smarter with how links and phone numbers are published so that the response rate can be accurately measured, i.e. unique links or discount codes for given channels," advises Lieberman. "Add to this NPS (Net Promoter Score) which is often a misused and misunderstood statistic."

Reconsider Your Own Measures

But don't stop with these five problematic or less than useful analytics. Look hard at all your analytical measures and determine if the information you're getting is truly impacting your business results.

"People configuring CRM software should understand that it's not the tool, but how you use it," says Adrian Sanders, CEO and Chief Value Migration Architect at VM Associates, a cloud-based business development consulting firm. "All CRM philosophies and metrics are the 'best' provided you apply them to the appropriate business objectives."