Why CRM data is having a moment

The dusty corner of marketing known as customer-relationship management is emerging as a critical tool for data-driven advertising, as marketers look to tap what they know about customers for banner ad buys across the Web.

Customer relationship management, or CRM, integrates the marketing, sales and customer service components of a business. This process is increasingly facilitated by technology — so much so that the acronym used describe the concept is used to describe the technology, too. In simplified terms, this mean one central system is often being used to tailor different messages to different people; be it on a website, on email, one the phone to a customer service rep or via a digital ad unit.

Add display to that list. Oracle, Adobe and Salesforce.com are rushing to push the idea that first-party data is the most valuable data around — and is critical to ad buys. Witness Oracle’s acquisitions of Datalogix.

“CRM has come of age,” said iProspect chief media officer Matt Adams. “CRM won’t be seen or referred to as a single discipline, digital or otherwise. It will no longer sit as a siloed discipline, either from client side organizational structures or in the way the technology operates.”

At a practical level, Adams predicts universal customer IDs will replace the historical profiling that brands would address their messaging to. Those IDs will be further informed by second- and third-party data sources. For a luxury watch maker, for example, data shared by a partner e-commerce store would count as second-party, while cookie data aggregated by a vendor from a collection of business websites to help target CEOs would count as third-party.

Ultimately, Adams expects CRM will just become part of the fabric of a brand’s content play and real-time custom creative will become the norm.

Still, others say this is still a ways off. After all the era of “big data” is frequently fueled by big hype.

“The method of joining CRM databases to audiences within advertising is no longer a mythical beast and is done by many different stakeholders in the industry today. But CRM serves a purpose beyond just advertising and similarly advertising isn’t only about data management — they are two distinct disciplines,” said Danny Hopwood, Vivaki’s head of platform for EMEA. “However, they can be joined when needed.”

The main flaw in the convergence argument, say some critics, is that broadcast advertising cannot target individuals.

“CRM can help us identify patterns among millions which may make the advertising work better, but this does not make them the same thing,” said Adam Smith, GroupM’s head of futures.

Much of the disagreement centers around the pace of this shift, though – not the fact that it’s happening. Trends like programmatic TV could, in the longer term, accelerate this convergence. In the short term however, a more practical issue could hold back greater convergence. The business models of companies operating in these sectors are still very different.

“Big enterprise software vendors operate on the software as a service model, while ad tech vendors often take a percentage of media spend,” said Mark Williams, director at Results International. “This very different way of working could act as an immediate barrier to more convergence in this space.”


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