Wireless CRM Yet to Kick In

A great idea-but so far, it's little else.

Theres one question that Atlantic Envelope Co.s salespeople used to dread hearing: "Do you have that in stock?" The simple query could trigger a salespersons slinking off, right in the middle of customer meetings, to call the customer service department just to get a simple inventory question answered. And when it was finally time to fill the order, receive price estimates and check inventory levels, they had to fax paper forms to the customer service department and then get back at a later date to the customer about final pricing and inventory levels. Securing a sale might take days.

Then, in February, AECO got CRM (customer relationship management), and it got it good. Jumping right over the fact that some sales representatives dont have PCs yet, AECO went straight to the customer-handling dream of the future: wireless CRM.

AECO executives gave 10 sales managers and three field sales representatives Research In Motion Ltd.s BlackBerry wireless handheld devices to pilot. The reps use the devices to check inventories and customer purchase histories and to reach the mecca of sales: closing sales on the spot. AECO is so happy with the results of the pilot that the staff of 85 field sales reps will soon start using the devices, according to Kerry Reedy, vice president of sales and marketing at AECO, a division of NSI Inc., in Atlanta.

While its nice to hear somebody sing the praises of wireless CRM, few enterprises seem willing today to spend what it would take to join AECOs chorus—certainly not enough to match the noise level vendors are creating about the technology. Throughout next year, said Adam Sarner, an analyst with Gartner Inc., in Stamford, Conn., all CRM vendors of enterprisewide applications are expected to release some sort of sales force automation wireless CRM package.

In some cases, as with AECO, the idea is to equip sales staff with a handheld device or WAP (Wireless Application Protocol)-enabled cell phone that offers limited functions—such as contact management, lead management alerts, inventory level checks, pricing and the like—to accomplish predetermined tasks such as checking inventory and price or accessing contact database information. In addition, vendors promise one day to deliver wireless deployments that involve nearly full-scale CRM capabilities, such as depiction of full customer data histories and the ability to perform analytics on, and to launch e-mail campaigns spawned from, that data by keying in to a PDA (personal digital assistant) or a wireless laptop.

Sounds super, right? But enter in the cost of supporting such devices, spotty wireless access coverage, slow data transfer rates and security issues, and wireless CRMs viability begins to appear dubious. Gartner has estimated that, on average, it costs companies about $2,700 per year per person to support PDAs (see chart, Page 52). Add the cost of leasing PDA software applications, and youre talking $1,500 per device per year more.

Wireless or no, such pricey CRM deployments are a familiar tale. The cold, sad reality is that, time and again, organizations have succumbed to vendors sales drives.

Throughout the 1990s, business spent tons of cash on CRM implementations, yet studies indicate that a majority of CRM implementations have failed to deliver: Gartner estimates that 60 percent of CRM software implementations fail. Instead of slipping into the same old money pit, enterprises should understand just what wireless CRM can deliver, experts say. This isnt to say that companies cant participate in wireless CRM if they perceive some benefits, but as the examples in this story show, you dont have to buy into the whole kit and caboodle to start reaping some return.

Keep it simple

Indeed, AECOs targeted use of wireless CRM may be why its so pleased with the results of its pilot. But how is the company dealing with constraints such as security and limited coverage? After all, when it comes to wireless coverage, the BlackBerry devices AECO sales reps are using have the same constraints of cell phones: They lose connection when in an area without cell phone coverage or when inside a building that blocks cellular coverage.

The reason why that hasnt been much of a concern for AECOs sales reps is that, although its a national company, most of its sales activity is limited to the Southeast, where BellSouth Corp. coverage is more than ample, according to Reedy. Of course, time will tell how this issue affects the sales staff once all 85 field sales reps are live with BlackBerry devices.

Security should also be a consideration, Gartners Sarner said. After all, companies have concerns when their employees access the corporate network from a secure connection in their homes, yet connections for wireless devices are even less secure, he said.

Those issues arent keeping Reedy up at night. All the data pertaining to sales assignments is password-protected. And the idea of corporate espionage by an envelope-dealing competitor trying to intercept his salespeoples wireless requests for inventory levels makes Reedy chuckle. "Intercepting wireless data is certainly not an impossibility," he said. "But am I worried about some competitor trying to get a peek? Nah ... not really. I mean, we were using faxes before. Thats not [particularly] secure."

One other drawback to wireless CRM is crawlingly slow data transfer rates. Average rates are now around 9.6K bps, with top speeds of 19.2K bps—less than half the speed of the fastest dial-up desktop modems. Currently, it can take several minutes to get Internet access on a wireless laptop or PDA—even a WAP phone—which can feel like an eternity in a sales meeting.

Reedy readily acknowledges the slowness of BlackBerry devices. One thing that helped AECO deal with it, he noted, was that the company designed a system that requires as few pages to download as possible. "We keep our forms short and direct," he said.

What about the additional cost of supporting wireless CRM? For small companies such as AECO, the expense of leasing wireless devices like BlackBerry is negligible. Reedy said the pricing options offered by Wireless Onramp Inc., of Roswell, Ga.—the third-party dealer from which AECO leases the devices—range between $40 and $90 per month per device for his company. But thats a price that AECOs more than willing to pay, since spending less time to close deals, he said, means more time for new deals. Of course, if AECO were attempting a more full-scale implementation of CRM—which would require feature-rich devices such as PDAs—annual support costs would spiral to the levels Gartner warns about.

To Infiniti and beyond

Nissan is another company thats had success with modest wireless CRM initiatives—and its the limited scope of the effort that has created the success, according to Ted Ross, who is now vice president of CRM solutions for i-Loft Inc., a consultancy in San Francisco, and who was, up until December, corporate manager of relationship marketing and CRM implementation at Nissan North America Inc., in Gardena, Calif.

While at Nissan, Ross was part of a wireless CRM initiative that focused only on lead management.

The program gave customers the ability to send an alert from Nissans Infiniti Web site to sales reps pagers when they were interested in a particular car model.

A total of 450 pagers were distributed to 150 dealerships. Within the first 60 days, the program resulted in 3,000 leads.

Its impossible to measure what kind of increase over the stand-alone Web site that represents. Nissan, which uses CRM software from E.piphany Inc., of San Mateo, Calif., had hosted the Web site for more than five years. Yet if the site was providing any customer leads at all, the company sure didnt know about them, Ross said.

"We wanted to know if the Web site was useful," he said. Wireless CRM, he said, would be a way for consumers "to do more than visit the site and just sit there," as well as a way to alert the company of their presence.

Planning the back-end process of the wireless CRM initiative was a challenge, Ross recalled. Customer privacy issues, for example, were a concern, Ross said. "We had to know that processes were in place at each dealership to ensure that customer information received was handled responsibly in regards to privacy and respect to the customer."

Going mobile

As Nissan and AECO show, its pos- sible to find examples of where wireless devices are helping to provide sales forces and field workers with more speed and efficiency out on the road. But, again, successful implementations depend on companies keeping use of wireless CRM devices limited to a few, simple, well-defined tasks.

For example, the institutional sales force at Dain Rauscher Wessels, an investment bank of Dain Rauscher Inc., in Minneapolis, uses BlackBerry devices to contact the companys research analysts, who are constantly on the road, a spokesman at Dain Raucher said.

Typically, the sales force will alert clients fund managers about certain stocks the company has just declared ripe for picking.

If the client determines that he or she would like more information before purchasing the stock, the salesperson can put out a message to a research analyst.

That message can include important details about the client that have been pulled out of Dain Rauchers CRM application from Pivotal Corp., based in North Vancouver, British Columbia.

Unfortunately, youll be hard pressed to find a company using wireless laptops or PDAs to do much more than that kind of simple function outside the office walls.

When will the dream of more feature-rich wireless CRM come to fruition? Gartner pegs the date around 2006, when issues such as slow data transfer rates may be ironed out.

In the meantime, enterprises should take a cue from IBSi LLC, an employee benefits sales and distribution company in Lancaster, Pa.

IBSi is looking to eventually give its fleet of 6,000 independent brokers wireless access to certain functions of its CRM application, such as allowing brokers to check order status, access contact information and generate price calculations for insurance quotes while theyre outside the office. IBSis CRM application is a Web-based system provided by YouCentric Inc., of Charlotte, N.C.

In these early days of wireless CRM, though, the company is making do with merely laying the groundwork for its eventual rollout.

That preliminary work is in the form of an upgrade to the YouCentric application that will give the company the option of going wireless when it so chooses.

And as it proceeds, its keeping a sharp eye out for all the issues that are still a concern for wireless CRM deployments, such as security.

"Naturally, we wont go through with it if we come across anything that causes us hesitancy," said Frank Ammerman, vice president of business systems.

With that kind of caution, enterprises can avoid falling into the CRM money pit—and maybe, someday, wireless will turn out to be the ticket that finally gets CRM investments to fly.