When Customers Manage the Relationship

There's a new fad in customer relationship management software: proactively encouraging customers to participate in buying decisions.

Theres a new fad in customer relationship management software: proactively encouraging customers to participate in buying decisions.

Using what one company calls "customer participation management," customers can choose how, when and why theyre contacted. Whats more, customers have the ability to make a purchasing decision — instantly — back through the communications channel that was used to contact them.

"Traditional CRM doesnt have the vehicles for proactively interacting with the customer," says Kenneth Pawlak, senior vice president of marketing and sales at Par3 Communications, who coined the phrase "customer participation management."

Seattle-based Par3 sells software to businesses that want to augment their CRM systems with a two-way participation module. The market for delivering such software and ser-vices is quickly becoming crowded, with traditional CRM vendors such as Oracle and Siebel Systems developing similar features, and start-ups such as Appriss, Centerpost, Par3 and Voxeo pitching new ways of interacting with customers.

Appriss switched its entire business around to focus on customer interaction services. The Louisville, Ky., company was formerly called The VINE Co.; it changed its name in September. Until last year, VINE — which stands for Victim Information Notification Everyday — was exclusively providing services to people who wanted to know whether a specific person was in jail and VINE notified them when the criminal would be released. When executives identified a potential commercial market for the technology, they relaunched the company.

The airline industry is already biting on the concept. American Airlines is deploying Appriss product, Northwest Airlines is working with Par3, and United Airlines is using Centerposts messaging system.

For the airlines, the most useful feature of these new CRM extensions is being able to automatically contact passengers when a flight has been delayed or canceled. Before their flights, passengers can customize their participation management policies on the airlines home page. When a flight is postponed, the airline can contact the passengers in whichever method they have chosen and present them with several alternate routes — and passengers can then act on that information in that communications session. So, for example, if someone received a "flight delayed" alert on a two-way pager, he or she could choose a different flight right from the pager.

American Airlines sees this as the difference between a static alerting system and an interactive customer interface. Previously, customers could only access flight status via a toll-free number or at American Airlines site, or they were called by a customer ser-vice representative if there was a delay. Now those customers can choose how theyre contacted and what theyd like to do using an automated system. Since American Airlines unveiled the system in February, it has become steadily more popular, with several thousand people signing up for it every day, says Scott Hyden, managing director of interactive marketing at American Airlines.

"We view this service as a travel resource to help customers manage their travel," Hyden says.