1. Unlock the Value of Customer Data with Conversation
The CRM has been a spectacularly successful technology application, especially in
providing large organizations with a detailed, unified view of their many individual
customers. Over the years CRM implementations can become great repositories of
information and sources for customer insight. That insight can be leveraged or put
into use for any number of business priorities, from marketing and sales to cus-
tomer care and business development. What many large organizations are finding
today, however, is that as smartphones, cloud computing and social networking
change the ways we communicate, applying CRM-based customer insight is becom-
ing increasingly complex and difficult. Indeed, there is growing evidence that many
of the techniques and practices that relied on CRM-based insights to drive customer
engagement online in years past — email marketing, lifecycle messaging, alerts
and loyalty programs — are becoming less and less effective. So even while the CRM
remains a potent source of customer insight, the lack of a customer communication
capability that enables the organization to act on that insight and engage customers
is becoming an increasingly critical problem.
Built to Manage Relationships, Not Communications
The point isn’t that legacy CRM systems aren’t as nimble as they should be, it’s that
they are designed to manage the customer relationship, not to manage customer
communication. To the extent that CRM systems are designed to facilitate interac-
tions with customers, it’s based on a point-in-time conception of how that interaction
should play out — and it’s unavoidable that that conception has a very short shelf life.
So what we see is that many CRM systems in place today were designed around the
concept of the customer from ten years ago: an individual using a desktop PC hard-
wired to the Internet, with the assumption that communication would happen through
email or phone only. Yet the reality is that a big chunk of any company’s customer
base today interacts with that brand through small screen smartphones and mobile
wireless, and through emerging channels like SMS text and IM.
Engagement in
the Smartphone Age
By John Pinson, Senior Manager, Content Marketing
and Carrie Scott, Direct of Product Marketing

2. 2 | Message Systems Engagement in the Smartphone Age | 3
notifications) all through a centralized
platform or hub integrated with their busi-
ness applications, CRM and other customer
information sources. This kind of commu-
nications hub would centralize customer
conversations for the entire enterprise,
making it possible for the organization to
engage mobile, online customers in the
ways they expect to be engaged. To get a
clearer picture of what we’re proposing,
let’s take a brief look at the ways consum-
ers communicate today, and then look at
the capabilities and features that would
characterize a CRM implementation aug-
mented with a customer conversation hub.
The Smartphone and Cross-
Channel Communication
The Way It Works Now
Your customers do it without even thinking
about it: cross-channel messaging. They
post to Facebook via text message, track
and respond to friends’ comments through
email and upload photos directly from their
mobile phone. Smartphones and tablets —
and regular PCs in many cases — are
cross-channel devices, giving the user
access to email, SMS/MMS messaging,
IM, social messaging and notifications all
through one screen. In person-to-person
exchanges, which channel comes into play
can depend on any number of variables:
relationship, convenience, cost, time of day,
or simple personal preference.
Yet when today’s consumer interacts with
businesses, it’s an entirely different story.
Most companies still approach commu-
nication as a marketing exercise: emails
are sent out at customers from addresses
such as “noreply@brandx.com” in the hopes
of click-through, or better yet, conver-
sion. But this is unidirectional monolog,
not a conversation. Oftentimes recipients
can’t even respond, let alone switch the
conversation over to text or IM as they can
with a person-to-person interaction. Even
when well-planned email campaigns are
structured around richly sourced CRM
intelligence, they can only achieve limited
customer engagement if they’re carried out
as conventional one-way interactions.
Today’s customer is far more likely to
research purchasing decisions online
through their social grid. They expect to
maintain an ongoing brand relationship
through whatever communication channel
is most convenient for them, and they
expect to carry on relevant conversations
over time through the full diversity of chan-
nels available to them. As communication
behaviors and preferences have changed
profoundly in recent years, the communica-
tions limitations of legacy systems have
come into sharper focus (we’re talking
specifically here about CRM, but none
of the current enterprise applications in
widespread use — account, transactional
or CRM — serve that need). The vibrant
discussion about “social CRM” that’s played
out online in recent years has centered on
these specific issues. But in the all the talk
about listening platforms, social analysis
and data integration, a key point often gets
overlooked: no amount of customer insight
will lead to engagement if the communica-
tion capability isn’t in place to facilitate
the interaction between brand and cus-
tomer. Our belief is that the companies
that rely on CRM systems as their engine
for engagement need to fortify their cus-
tomer intelligence systems with a true
customer communications hub if they
aim to realize the full value of their
­customer intelligence going forward.
Understanding the
Customer Disconnect
Compiling a consolidated view of customer
communication gets more complicated as
end points and sources of data proliferate —
especially machine-generated data like
network logs, banking transactions,
telecom records, automated text message
content and so forth. But that’s not neces-
sarily where enterprise application systems
fall short in effecting engagement. Where
they do fall short is at the interface point or
in the communication channel where B2C
engagement happens. Online engagement
today requires two-way dialog, meaning
your applications need to have advanced
customer communication capabilities:
intelligent sending and receiving that lets
the business interact with customers
through email, through SMS and MMS text,
through IM, and social messaging also.
More and more, as mobile devices become
the medium through which consumers
interact with brands, message-based
communication is the environment where
engagement happens.
So, we argue for more advanced commu-
nication capabilities. Ideally the enterprise
would control email, SMS/MMS, IM and
emerging formats like push network
messaging (for Apple and Android app
Decline in Email Marketing ROI per Dollar Spent
The Direct Marketing Association reports that ROI on email marketing has dropped
25 percent since 2006 (from $52.23 to $39.40 in 2012) and that number is expected to
continue to fall each year, to as low as $35.02 returned for every dollar spent by 2016.1
$60
$50
$40
$30
$20
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
In the age of the
customer, successful
businesses must be
ready to connect with
consumers in any
channels they desire.
Zach Hofer-Shall
Forrester Research
Mobile Web Eclipsing Desktop
The mobile web is expected to reach
nearly two billion users by 2015,
which will outrank desktop usage.
mediabistro.com
1
Email Remains ROI King; Net Marketing Set to Overtake DM, Says DMA.
The Magill Report. October 4, 2011. http://www.magillreport.com/Email-
Remains-ROI-King-Net-Marketing-Set-to-Overtake-DM/

3. 4 | Message Systems Engagement in the Smartphone Age | 5
Think of how Facebook uses simple trans-
actional alerts — the text message or email
you get to let you know that your sister
Jane posted something on your wall. Unlike
one-way email of the conventional (market-
ing) variety that exhorts you to do one thing
only — click through — a Facebook alert
gives you options. You can click through and
see the comment on your Facebook homep-
age, you can post a comment in return by
responding to that text, or you can respond
to that email directly to Jane. It’s a simplis-
tic form of cross-channel messaging, but
Facebook notifications are extraordinarily
effective at driving traffic and increasing
engagement. This form of transactional
alert is not that different from the confirma-
tion emails we get when shopping online.
However, Facebook alerts encourage inter-
action and ensure users can connect via
other messaging channels, not just on the
website. They are naturally conversational,
whereas conventional transactional com-
munications are nearly always one-way
affairs, and if you try responding to one your
reply message is likely to end up in a “bit
bucket” where it will be promptly ignored.
With good reason, Facebook has been
called “CRM for individuals,” because it’s
essentially a personal data store with a rich
feature set for conducting and managing
personal relationships online. Just as with a
CRM system, Facebook records and tracks
every interaction so that a rich profile of the
individual builds up over time. The major
difference between Facebook and conven-
tional CRM systems is the communications
capabilities in play. Facebook users can
reach out to friends and family through
a full array of communication channels
(Facebook message, email, IM and SMS/
MMS text) and conduct rich conversations
in real time or over an extended period of
time — think of how comments build up on
photos you post. As discussed, enterprise
applications, including CRM systems
mostly lack this kind of cross-channel,
conversational functionality. So the ques-
tion for companies looking to gain this kind
of engagement capability largely becomes
one of how best to integrate an intelligent,
centralized digital communication capability
— a conversation hub — within your enter-
prise environment.
What to Look For
Of course, many CRM vendors are already
moving in this direction, with Salesforce
leading the way with its Force.com for
Facebook and Salesforce for Twitter. Yet
we’re mostly seeing a rush toward bring-
ing customer interactions in the social
realm under the CRM umbrella with chan-
nels being kept separate, rather than a
comprehensive enterprise-wide approach
to all conversation-oriented interactions
that happen in email, or IM, or text. What
companies should really be focusing on
is finding a customer conversation plat-
form that your transaction systems, and
CRM, can use to support discussion-style
interactions no matter which messaging
channel your customer chooses. Such a
conversation hub would need to provide all
or most of the following:
Similarly, when companies get messages
from customers, the context that is ever-
present in person-to-person interactions is
often completely absent. Unless it’s a direct
response to an offer or solicitation within
the originating channel, there’s no way for
the company to know if that customer had
recently made a purchase, or asked for cus-
tomer assistance, or is an important repeat
customer going back many years. Think of
the way you interact with a neighborhood
business, like a barber or a local sporting
goods shop. Over the years your barber is
going to become familiar with the style of
cut you prefer. The shop owner is going to
know that you’ll be bringing in your skis
for a wax job in late November and that
you prefer tire tubes with presta valves
for your road bike.
This detailed customer intelligence is
exactly what CRM systems were created to
capture; the idea was to enable large com-
panies to provide the kind of personalized,
one-to-one interactions characteristic of
small businesses. And while the data and
customer insight is being captured, the lack
of communications agility prevents it from
being acted up. Underlying IT shortcomings
are the root cause. For instance, communi-
cations capabilities are often siloed within
the organization — the customer care
department has IM, but marketing doesn’t.
Marketing has multi-channel campaign
management with mobile capabilities, but
SMS text is otherwise unavailable to the
rest of the organization. Even if purchase
history or other customer data exists in
the CRM, and in all likelihood it does, the
disconnect between customer intelligence
and customer communications capability
presents a major roadblock to engagement.
Because if companies can’t fully perceive
who their customers are, they can’t know
their preferences, needs and wants, or
act on them. Relevance is missing; true
engagement can’t occur.
The Way It Needs To Work
Older generation consumers might not
object to the lack of cross-channel interac-
tion with brands because it’s what they’re
used to. But you can bet that Gen Y and
its successors — social media natives —
will. They’ll choose the brands that ‘get it’
and that don’t try to dictate the method of
interaction. So the question becomes, how
will cross-channel engagement between
brands and their customers work? Here’s
where the concept of conversation becomes
central for engagement today.
Mobile Email Up,
Web-based Email Down
By some measures web-
based email use is down
15%, while mobile email
use is up 33%.
comScore.com
Decline in Inbox
Deliverability Average
After several years of relatively
stable email deliverability rates
of around 80 percent, commercial
email senders saw a drop to only 76.5
percent globally in 2011.
returnpath.net
Whether its email, social
media, IM or texting,
consumers have many
ways to communicate...
The decline in web-
based email is a
byproduct of these
shifting dynamics.
Mark Donovan
Senior VP of Mobile, comScore

4. 6 | Message Systems Engagement in the Smartphone Age | 7
and ensuring that your text communications
get sent through the mobile partner that
best meets your budget and delivery needs.
Costs for mobile messaging can quickly rise
to intolerable levels if not closely monitored.
Centralized Management: Managing out-
going and incoming communications from
a central hub is essential for supporting
conversations that cut across multiple orga-
nizations in the business — for instance,
transitioning a customer care conversation
to an upsell through the marketing arm —
or responding intelligently when customers
communicate in unanticipated way, such as
replying to transactional alerts.
Proactive Deliverability Management:
Deliverability is generally understood
as an email issue, yet reliable delivery of
important messages is critical for engage-
ment regardless of the channel, and is
important for protecting your reputation
and improving the effectiveness of your
communication programs.
Safe, Secure Conversations: Create a safe,
secure and trustworthy communications
environment for customers and partners
by implementing industry best practices
for reputation management and security
with DKIM and SPF authentication, and the
emerging DMARC standard.
Looking Forward
There’s no longer any doubt that changes
ushered in by the BlackBerry, the Android
and the iPhone have remade the ways
brands and individuals interact. Control
over the B2C conversation has firmly
shifted over to the customer, and this fact
is causing real and serious new problems
in the ability of businesses to engage their
customers. If the CRM and other customer
interaction solutions are going to main-
tain their position as the central nervous
system for engagement, then all enterprise
systems will absolutely need to acquire the
ability to effectively communicate through
all the channels available to consumers
today. With an intelligent customer con-
versation hub, companies will ensure their
ability to maintain customer engagement
today and in the future.
Cross-Channel Dialog Capabilities:
Cross-channel communications that allow
you to conduct engaging, real-time con-
versations with customers through email,
mobile messages and other channels using
your existing systems.
Advanced Message Management Features:
The power to segment message streams,
interact with customers through multiple
channels, and manage cadence and delivery
across time zones to foster conversations at
the times most likely to engage recipients.
Agility to Act On All Customer Intelligence:
The ability to customize email, SMS/MMS
and other kinds of messages on the fly
using all of your in-house data, includ-
ing CRM data or outboard data sources or
business logic, to target customers with
customized creative, and structure cam-
paigns for optimum response.
High-Volume Messaging: The ability to
scale message volumes as needed to reach
millions of customers and prospects at the
right time and place.
Logging & Visibility: Tracking outgoing
and incoming messages is critical for sup-
porting conversations and also improving
communication programs over time to
incrementally increase engagement.
Response Processing: Intelligent message
disposition and response capabilities allow
you to facilitate true two-way, cross-chan-
nel communication with your customers
regardless of whether interactions start in
email, mobile text or other channel.
Mobile Message Management: Automated
policy-based routing is key for working
with multiple mobile aggregators (usually
a must for optimizing the mobile channel)
Social CRM is the
company’s response
to the customer’s
ownership of the
conversation.
Paul Greenberg
Author, CRM at the Speed of Light
15 yrs
10 yrs
5 yrs
0
Slow
Gradual
Moderate
Fast
The Rise of Mobile Messaging
Correlation does not imply causation, of course, but it’s clear that the declines in email
deliverability and email marketing ROI we’ve seen recently have coincided with the growing
adoption of smartphones, social media and mobile email. In fact, the changes brought about
by the smartphone have been profound and abrupt. MIT’s quarterly Technology Review
reports that smartphones have become mainstream in the U.S. faster than any other major
technology shift in the past 150 years. The telephone took 39 years to gain widespread
adoption, but the smartphone — and tablet computers — have gone mainstream in just a few
years, rivaling the adoption of TVs in the 1950s for speed to market saturation in the U.S.2
2
Are Smart Phones Spreading Faster than Any Technology in Human History? Technology Review. May 9, 2012
http://www.technologyreview.com/news/427787/are-smart-phones-spreading-faster-than-any/
39
yrs

5. Published by:
Message Systems, Inc.
9130 Guilford Road, Suite 100
Columbia, Maryland 21046
410-872-4910 (phone)
877-887-3031 x312 (toll free)
410-872-4913 (fax)
messagesystems.com