Author: just-style.com

CRM and eCRM are revolutionising the way apparel companies interact with their customers. To find out more about CRM's impact on the industry, just-style.com spoke with Jud Early, corporate vice president of apparel research for US-based textile think-tank [TC]2.

Jud Early, corporate vice president of apparel research for US-based textile think-tank [TC]2

just-style.com: Define Customer Relationship Management (CRM) and eCRM in terms of its role in the apparel industry.
Jud Early:
CRM on the business side means making sure all the systems you operate from and with are integrated, and information about the customer is available from the same body of data to all people who touch that customer. From the customer side, CRM should be almost invisible to manage customer relationships well. You need to learn as much as possible about the consumer through overt actions, such as seeking information and asking questions, as well as covert fashion - not unethical or untoward, but there are some ways to learn about customer that are not offensive to them but rather give them more delight.

One really good example of covert CRM is something Ritz-Carlton does. They equip doormen and hotel greeters with Dick Tracy-like wrist radios and when a customer drives up to check into the hotel, the person who grabs his bags notes his baggage tag. That person then notifies the desk that John Jones has arrived and the front desk greets John Jones by name when he reaches the counter.

Although they're not an apparel company, Ritz-Carlton is one of the most often quoted companies in any industry practicing advanced levels of CRM. Although getting to know the customer as Ritz-Carlton does is considered covert, they don't offend the customer because that person is delighted to receive such a high level of service.

Another example of covert, but ethical, CRM within apparel is observation. Say you're shopping in a retailer that keeps salespeople staffed on the floor. The salespeople may keep their distance, but note items of interest to customers. If the store has CRM tools, when a customer leaves, the salesperson should log those interests into the database, even if no purchase was made or no garments picked up from the rack. Then a personal note or call later from the salesperson might be: "I noticed you were interested in the Armani scarf, they'll be on sale Thursday and I thought you'd like to know."

Observational getting to know the customer is a very good side of CRM, although there are many horrible applications of eCRM. The more you can learn about a customer with his or her permission, the more you gain through unobtrusive observation, and the better a company is able to target offerings to customers.

To summarise, CRM has two components: the side that touches the consumer and the business side including marketing, order entry, order fulfilment, etc. Any time someone in a company touches a customer, they should be working from the same base of information. If John Jones likes chocolate chip cookies, that information should be available to everyone from the bag checker to the front desk attendant to the person who delivers the cookies.

eCRM by my definition is the use of electronic means to practice CRM. That electronic means could be monitoring moves while surfing, as in the case of interactive cable TVO, in which they were logging TV watching preferences without the knowledge of the users. That's an example where e-CRM went wrong. It was not intended to be offensive, but consumers didn't know their preferences were being tracked. If TVO had said, "we'd like you to approve TV-watching preferences," then people could make an informed decision to allow it.

If shoppers are going from website to website looking for a blue sweater and websites are logging their movements and interrogating every site they visit, this is highly intrusive eCRM.

Also in eCRM, we're about to see rash of possibly poorly implemented or poorly administered actions labelled as CRM, but probably just customer intrusive. For example, cell phones today are pretty sophisticated - some allow users to surf, while some can even pinpoint a user's exact location. But here's where we'll see public outcry. Let's say a Bergdorf Goodman shopper is window shopping outside the store, her cell phone rings and a computer says: "We noticed you're in our area and we also noticed you were interested in gloves. They're on sale today." By having location, customer preference information and a cell phone number, as soon as a shopper enters the neighborhood, the retailer will start calling. This is also a serious misuse of CRM technology. If someone is paying cents per minute for a cell phone, they're going to get upset by getting an ad every time they walk by a retail establishment.


"The integration of wireless with customer account management could definitely have a positive impact on apparel companies"

There are good uses for CRM technology. Let's say you're a salesperson with a customer who needs to place an order today or they will run out of a style. If you have a wireless web-enabled phone, you can access the corporate database. First, you can check to see if you have product. Assuming you do, to make sure you get paid, you can check to make sure the customer has made the past few payments on time. Then you enter the order via cell phone so the customer's needs are satisfied in real time. Customers used to have to leave the office, log on to their computer via mainframe to place an order. The integration of wireless with customer account management could definitely have a positive impact on apparel companies.

just-style.com: How prevalent is the use of CRM and eCRM technology in the apparel industry?
Early: Very limited, particularly if you're a brand owner and don't have a branded store like, say, Jones New York, which sells through Federated and Dillard's, not Jones stores. Their ability to touch the customer is limited because they have somebody - the retailer -sitting between them, somebody who owns the customer. Land's End, JCPenney online, LL Bean or the thousands of catalogues where their customers come in contact with brand owner have a better chance of practicing CRM.

just-style.com: Which types of apparel companies are best suited for CRM and particularly eCRM applications?
Early: Those with direct contact with customers. For example, a brand owner's customer might go to a website, as in the case of Wrangler, and that customer may be able to develop knowledge about Wrangler. But as long as VF is still selling through retailers, when a customer goes to buy Wrangler jeans, they still pay through the department store.

just-style.com: Which apparel companies are implementing CRM or eCRM tools successfully?
Early: None that I can speak about. I know on a limited basis - very limited - Brooks Brothers implemented tools made by ImageWare to allow it to track customer preferences and keep closer information files on consumers. Neiman Marcus has also begun implementing the same software for similar reasons.

just-style.com: So with regard to CRM for apparel companies, the sky's the limit?
Early: Absolutely. The companies that can afford to implement CRM can't afford not to. Once you cement a consumer to you and they come back time after time, he or she is so much easier to retain through good action versus building an entirely new relationship with a new consumer. CRM will have a very positive impact on companies willing to put effort into making it work.

It's not just a matter of asking Suzie what's her favourite colour. CRM is a pervasive philosophy and set of tools, reaching all elements of a corporation where information is gathered relating to how that corporation transacts business with its consumers.


"The companies that can afford to implement CRM can't afford not to"

And there are some poor implementations. Say you want to do web shopping and you find a shirt you want to buy, but want to go to the store to look at it first. If the web arm of that company is totally separate from the retail arm and they don't like each other and don't talk to each other, it can become a huge problem to navigate. On the other side, the company that makes it easy to move among multiple channels - allowing you to order from the catalogue or online and return to the store - and makes all information available on all channels is extremely positive.

just-style.com: In terms of eCRM tools, how difficult is implementation with legacy systems?
From what I've read, what happens is over time, as companies grow, they might have accounting running on certain systems, they might have order entry on another and then warehousing on yet another. These systems have grown over the years by being added to and they don't operate on a common database. When a supplier comes to prepare an enterprise-wide system for CRM, with multiple applications and hardware not defined for CRM, integration becomes extremely difficult.

There are a number of companies offering enterprise-level integration and several offering best-of-breed CRM solutions. Seibel Systems has a disclaimer that tries to point out that integrating with legacy is not a bang dead proposition. It's very difficult. You have to strip out the old because it wasn't written for integration. Several companies offer CRM and claim to be able to plop their package to co-exist with existing applications. However, I'd be apprehensive. It's not that easy in most cases.

just-style.com: What are the challenges in implementing CRM and eCRM tools?
Early: First, define the scope of what is it you're going to accomplish with the integration of CRM or eCRM systems and what information is needed for all parties to provide sterling service. Maybe there's information that accounting needs but sales doesn't, or something order fulfilment needs but the others don't. If everyone is working from a common database, it's critical to define all the interests of all parties involved.

Then make sure the scope meets with the tools intuitively, and is as easy to use as possible. In huge apparel companies, there are lots of activities going on. When Sally Jones places an order, the person on the other end has to know what's going on. If they have too much information or if the information is not presented logically or intuitively, it's not serving anyone well. So beyond defining the scope of the information, the next most difficult challenge is presenting it in the most intuitive, logical way possible.

just-style.com: How are these challenges being overcome?
Early: It's an evolution. As apparel companies implement the CRM process, integrators learn what works and what doesn't. They go back to R&D and use the information to improve the process. The next guy adds more change or functionality and, over time, things reach a level of refinement that's just not going to be found the first time the tools come out of the box. It's about balance - CRM is not going to just fall out of sky and be perfect.

just-style.com: What are some other examples of unique or proactive uses of CRM tools or strategies?
Early: Both LL Bean and Land's End have proactive strategies. Basically when you call them, their call centre operators have complete information available, including how many orders a customer has placed, years of history in their records, customer size and more. Another apparel seller, QVC, does a remarkable job of making the customer feel like part of the QVC family. They are able to get information readily and have embraced technology on many other levels within the company.


 "When you call LL Bean and Land's End, their call centre operators have complete information available, including how many orders a customer has placed, years of history in their records, customer size and more"

just-style.com: What steps should apparel companies take that are preparing for CRM implementation?
Early: First, define what it is what you want from your CRM tools. If it's a relationship with consumers, understand if it's going to get in the way of selling to a customer. If JCPenney is my customer, I might like to meet and understand the needs of the end consumer, but JCPenney may not care for that. They may want to watch consumers more closely than appropriate for a manufacturer. There's always a concern when a manufacturer touches a customer that maybe some of the middlemen are going to get cut out. The challenge is to define what you want to do, design systems to attain this information on consumers, and then aggregate the data so it's useful to everyone who needs it.

just-style.com: If I were an apparel manufacturer determining whether CRM or eCRM is a good decision for me, what are the key selling points? What are the distinguishing features between CRM providers?
Early: I'd want some references from companies they've done successful implementations for. After finding out who their business partners are, set up meetings and understand how well different integrations performed. How long did it take? Did they adhere to the budget? Were there any surprises? Then there's no substitute for eyeball-to-eyeball contact: do people click or not. Find out if you click with a provider - do they truly listen and look for a solution versus hammer your needs into cookie cutter application?

just-style.com: What are the implications of CRM on a company's culture? How does an apparel manufacturer prepare for that?
Early: If the company doesn't already have a culture of listening to the consumer and going that extra mile, the big culture change is going to be getting people inside to understand why they should do that. Some companies are cold and lifeless, and mechanically take an order, process it and deliver goods. If they could provide a more personalised, warm environment and work to satisfy their consumers, I think customer retention and loyalty would go up exponentially. To get people who normally don't work that way to figure out why they should is much bigger than companies just implementing new CRM applications. If a company already has a strong focus on the customer, like Miliken for example, using these tools is simply an extension of their current business. It's like I've always driven a car, but now I drive one with power steering.

[TC]2 provides assistance to the sewn products industry for improving business systems and manufacturing resources. It serves as a resource for fibre, textile, retail, apparel, and sewn products companies. Staff are involved in presenting seminars, providing consulting services, conducting research, and operating a team-based manufacturing facility.

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